The terms of her automobile insurance policy will dictate the insurance company's responsibility to her to defend against possible lawsuits. Without seeing the policy it is impossible to conclusively answer your question, but generally, the policy will provide an attorney for her.
Disclaimer: This does not constitute legal advice. No attorney-client relationship has been formed through this answer.
If your wife is a named insured under your insurance policy, the insurance carrier has a duty to defend and indemnify her. There may be exclusions and exceptions in the insurance policy, so it is not possible to give you a definitive response without having studied your policy.
Frank W. Chen is licensed to practice law in the State of California. The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, consult your own attorney.
Please specify why your insurance company will not defend her. There has to be a valid reason, such as the fact that she was not a licensed driver or not listed on the policy. Even if she was not listed on the policy, she may have been a permissive user which entitles her to coverage and a defense. I would suggest reviewing with a competent attorney any disclaimer from the insurance company and not just accepting that they can do so. Insurance Companies, and yes the one with the lizard as its spokesman, will do anything to get out of paying and it is not always the right decision.
I would need to see a copy of the policy to determine whether there are any issues outside the norm. However, the insurance carrier likely has a duty to defendd your wife and indemnify her.
This advice should not be construed as forming an attorney-client relationship.
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