My understanding is that the insurance company has to step in and defend the lawsuit / arbitration and then after an award they can try to claw back any monies paid if it was intentional.

I am confident about them having to step in and defend until the ruling. But I'm not sure about the next step. i.e whether they have to pay and then clawback, or if they withhold payment and try to get eg amarex to pay at that point. I think it is the former, but I'm not sure.