Here is a blog blurg from Hinshaw:
"New York Court Holds Lawyers Retained By Insurer to Represent Insured May Have Duty to Put Excess Carrier on Timely Notice of Claim
Shaya B. Pacific, LLC v. Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, 827 N.Y.S.2d 231 (N.Y.A.D. 2 Dept. 2006)
After a judgment was returned in excess of the primary policy limits, the defendant in the underlying tort case, plaintiff in this case, sued the defense firm for failing to put the excess carrier on timely notice of the claim. The lower court dismissed the case, but the appellate court reversed the dismissal and held it may be possible for a lawyer retained by the primary insurer to be liable for failure to investigate insurance coverage. The key is the scope of representation. "