Will I be covered?

What is the name of your state?What is the name of your state? New York

My daughter was in my auto policy while living with me at home. She moved to her own residence 4 miles away but I kept her in my policy. She had an accident when she ran a red light. The other party is suing for injuries for 500,000. Could my insurance company decide not to defend me or hold me responsible because my daughter was not residing with me at the time of the accident?

They can deny the claim because you violated the terms of your contract with them. She needed to have her own policy on her vehicle. You, of course, now know that.