the settling parties have chosen, as here, to implement a default agreement rather than a stipulated judgment, two as yet unresolved questions are presented: Is it the default agreement itself or the judgment resulting from the default agreement that is to be tested for reasonableness? And, if the insurer intervenes in the tort action following the default but before the damages hearing, what issues may the insurer challenge at the damages hearing? We apply the principles of Morris and its progeny to answer these questions and resolve this appeal. ¶ 19 The supreme court in Morris recognized that neither an insured seeking financial protection nor the tort plaintiffs will normally have an incentive to limit a stipulated judgment to a reasonable amount. See id. at 120, 741 P.2d at 253 (<HOLDING>); see also Himes, 205 Ariz. at 38, ¶ 22, 66
holding that insured cannot bring an action against its insurer for bad faith failure to settle a claim in the absence of an excess verdict holding action by judgment creditor of insured against insurer for bad faith failure to settle claim against insured not a direct action within section 1332c proviso holding that insured was not required to suffer an excess judgment before it could sue its excess insurer and primary insurer for bad faith failure to settle where it was alleged the insurers arbitrarily refused to settle and insured was required to pay 1 million in settlement to avoid near certainty of larger judgment that would exceed all available coverage recognizing an insured might settle for an inflated amount or capitulate to a frivolous case merely to escape exposure or further annoyance holding that liability based on an implied covenant exists whenever the insurer refuses to settle in an appropriate case