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 Texas, the eight-corners rule is a legal doctrine used to determine whether an insurance company has a duty to defend its policyholder in a lawsuit. This rule involves comparing the allegations in the lawsuit (the 'four corners' of the plaintiff's pleading) with the provisions of the insurance policy (the 'four corners' of the policy). Texas courts typically do not consider any facts outside of these documents when applying the eight-corners rule. However, there are exceptions where extrinsic evidence may be considered, particularly if it indicates fraud or collusion between the plaintiff and the insured to trigger the insurer's duty to defend. Texas courts tend to interpret the eight-corners rule in a manner that favors the insured, meaning that if there is any doubt or ambiguity, the insurer is more likely to be found to have a duty to defend the insured.