What is the insurer's duty to defend under a CGL policy?

• A. The insured must defend themselves at their own expense.
• B. Only indemnify the insured after settlement.
• C. The insurer must defend any covered claim or suit against the insured and pay defense costs, within policy limits.
• D. Defense costs are paid by third parties.

Answer: (C)

In a Commercial General Liability policy, the insurer has a duty to defend whenever a claim or suit against the insured could be within the policy's coverage. This means the insurer must step in to defend the insured and pay the defense costs, up to the policy limits. The defense is provided even if the allegations are groundless, as long as there is any potential for covered benefits. Defense costs and the obligations to defend are typically accounted for within the policy limits, so the insurer bears the defense expenses rather than the insured. This is broader than the obligation to indemnify, which comes into play only if coverage and liability are established. The other options misstate who bears the defense costs or when defense is required.