Hammer clause

January 30, 2026 by AC Editor

Categories: liability, mpl

Clause that can shift financial consequence to insured if insured blocks a recommended settlement.

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Mass. Highest Court Rules Consent-To-Settle Clause Does Not Violate Public Policy Of The Unfair Claim Statute
On Monday, December 16, 2019, the Supreme Judicial Court decided the question of whether the consent-to-settle clauses commonly found in professional liability policies violated the unfair claim practice provision of M.G.L. c. 176D, § 3 (9) (f).
Glossary: Coinsurance hammer clause
Variant hammer clause with cost-share effect.

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