The eight-corners rule is a rule applied by courts to determine whether an insurance company (insurer) has a duty to defend a claim made against its insured policyholder (insured). The eight-corners rule provides that the duty to defend is determined by comparing the “four corners” of the plaintiff’s pleading (lawsuit) with the “four corners” of the liability insurance policy.

In applying the eight-corners rule, courts generally do not consider facts or evidence from outside the four corners of each of these documents and take the plaintiff’s factual allegations in the pleading as true for purposes of determining whether the insurer has a duty to defend.

But some courts have held that outside or extrinsic evidence may be considered if it demonstrates collusion or fraud between the plaintiff and the insured for the purpose of invoking an insurer’s duty to defend.

Courts generally apply the eight-corners rule liberally and resolve any doubts in favor of the insured by finding the insurer has a duty to defend the insured against the claim(s).

In Arizona, the eight-corners rule is utilized to determine if an insurer has an obligation to defend its insured in a lawsuit. This rule involves comparing the allegations within the complaint (the 'four corners' of the plaintiff's pleading) against the coverage outlined in the insurance policy (the 'four corners' of the policy). Arizona courts adhere to this rule and do not typically consider facts outside of these documents when making a determination. The rule is applied with the presumption that the allegations in the lawsuit are true for the purpose of this assessment. While Arizona courts generally do not consider extrinsic evidence, there may be exceptions if such evidence clearly indicates fraud or collusion between the plaintiff and the insured to trigger the insurer's duty to defend. The application of the eight-corners rule in Arizona is done liberally, with ambiguities often resolved in favor of the insured, thereby imposing a duty to defend on the insurer.