Opinion ID: 487784
Heading Depth: 1
Heading Rank: 2

Heading: As Soon As Practicable

Text: 24 As set out above, the policy required an insured making a claim to notify Forum of any loss as soon as practicable. The phrase as soon as practicable means within a reasonable time under all the circumstances to effectuate the objects and purposes of the notice clause. Young v. Travelers Insurance Co., 119 F.2d 877, 880 (5th Cir.1941) (applying Mississippi law). Notice given so late that it is unreasonable or that prejudices the insurer bars recovery by the insured. Id. 25 A notice provision in an insurance policy is essential to giving the insurance company the chance to settle or litigate claims for which it ultimately might be liable. As we recently noted, timely notice enables the insurer to investigate a claim against the [insured which may be] covered by the policy; to itself decide whether the claim should be settled without litigation, and, if not, to prepare its defense.... Bolivar County Board of Supervisors v. Forum Insurance Co., 779 F.2d 1081, 1084 (5th Cir.1986) (interpreting Mississippi law) (emphasis omitted) (quoting Aetna Life Insurance Co. v. Walley, 174 Miss. 365, 164 So. 16 (1935) (Bolivar held that notice of a claim for reimbursement of attorneys' fees was not as soon as practicable when it was given after the claimant had spent $88,000 to litigate a suit)). As set out above, Forum had both the right and the duty to defend suits against its insureds. See also 7C J. Appleman, Insurance Law & Practice Secs. 4681-4682 (W. Berdal ed. 1979) (insurance companies generally have this right). An insurer that refuses an opportunity to defend will be precluded from relitigating any issues necessarily determined in the primary action, and may become bound to pay a judgment against an insured. Id. at Sec. 4689.