Courts have traditionally held that an insurance company has no right to intervene in the liability action against the insured to seek a coverage determination. An insured files a declaratory judgment action against their insurer and names an injured third party who shares citizenship with the insured.This insurance coverage action arises out of settlement negotiations in an underlying lawsuit. The facts are not disputed. The United States District Court's look at whether a party that is not an insured may seek a declaration regarding an insurer's duties under its policy. Or seek a declaratory judgment regarding the scope of coverage under a policy. While the personal injury case was pending, plaintiff also initiated this declaratory judgment action against Hanover challenging the disclaimer of coverage. Consult the rules and caselaw that govern in the court where you are filing the pleading. Plaintiff Ark Corporate Member Limited filed this declaratory judgment action regarding insurance coverage. In their amended answer, Defendants AEU Benefits,.