In the recent action of Teleflex Medical Inc. v. National Union Fire Insurance Co. of Pittsburgh, PA, 851 F.3d 976 (9th Cir. 2017) (No. 14-56366), the US Court of Appeals for the Ninth Circuit applied California law to require an excess insurer, presented with a settlement of underlying claims against its policyholder, to choose between (1) accepting the settlement where it is reasonable and not the product of collusion, (2) rejecting the settlement but taking over the defense of the underlying claims, or (3) rejecting the settlement and refusing to take over the defense, and as a result, facing breach of contract and bad faith claims. Following a settlement in the underlying action conditioned on the receipt of insurance proceeds, the primary insurer, CNA, agreed to tender its full $1 million policy limit to the policyholder. The excess insurer, National Union, however, did not agree to contribute the relevant portion of its $14 million policy limit to fund the remainder of the conditional settlement. Instead, over the next few months National Union requested, and the policyholder provided, additional information regarding potential liability and damages in an effort to determine the reasonableness of the settlement. The policyholder repeatedly asked National Union to assume the defense of the continued action if it would not consent to the settlement. National Union refused and the policyholder was forced to finalize the settlement without National Union’s consent. In the subsequent coverage action, the district court held, and the Ninth Circuit later affirmed, that the duty of good faith owed by an excess insurer to a primary insurer and a policyholder did not permit an excess insurer to arbitrarily veto a reasonable settlement and force a primary insurer to bear the continued costs of defending the action. Instead, an excess insurer must either (1) accept the reasonable settlement and contribute its relevant limits or (2) reject the settlement and assume the defense of the continued action. While Teleflex is specific to California law, the policy considerations articulated by the Ninth Circuit should nonetheless offer a framework for any other jurisdictions whose law on these issues is unsettled.