Personal Injury Policy Limits – 6 Must Know Tips
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By: Rex Bush, Doctor Of Jurisprudence, Attorney At Law
Getting a “limits” offer is great. Especially if it comes before filing suit. A lot of time and expense is saved. But there are pitfalls. And you must negotiate them successfully to avoid shooting yourself in the foot. Here are some tips to help you through the process.
1. Verify Coverage
In auto accident cases if your injuries are severe and the at-fault driver had minimal coverage, it is common to receive a “policy limits offer.” In this, the at-fault carrier is offering you the available coverage in exchange for your full and final release of all rights against the at-fault insured.
You can verify that the amount offered is all that is available by examining the declaration page. The “dec page” is a computer printout that lists the coverage of the at-fault driver at the time of the accident.
Even more certain is a “certificate of coverage” which you can request and obtain from the at-fault carrier.
2. Check Availability of Underinsured Motorist Coverage
Once you are satisfied as to the amount of coverage of the at-fault driver you need to examine your own coverage. Did you purchase “underinsured motorist coverage (UIM)?” Hopefully so. The more the better. If you have plenty of UIM coverage then you can skip the next step i.e. obtaining an “asset search.”
3. Perform An Asset Search
If you have no UIM coverage then all you are going to get is what you can from the at-fault driver. An asset search looks at the real estate and cars owned by the at-fault driver. If he was underinsured in comparison to his assets you may want to hire a lawyer to sue him directly. Once you have obtained a judgment you can use it to sell his cars and real estate.
4. Ask For Waiver of Subrogation
Subrogation is the reimbursement an insurance company seeks after paying a claim. It would typically go after the person at-fault or his insurance company. So, if your auto carrier paid your medical bills under MedPay or PIP (personal injury protection) coverage it may be able to collect that money from the at-fault carrier.
If the at-fault carrier pays subrogation, that amount is deducted from the policy limits–thereby reducing the money for you. Ask your own auto carrier to waive its claim for subrogation. If the agree, and they usually will, it means more money in your pocket.
5. Obtain Consent to Settle
If you have UIM coverage you may need to ask for consent from your own auto carrier before you can settle with the at-fault carrier. Check your policy. Failure to get consent could jeopardize your claim.
6. Modify Release (If Needed)
If you are insured with Allstate, for example, and the at-fault driver was also insured with Allstate there is another factor to consider. You will be asked to sign a “Release.” By signing the Release you give up your claim for more money from the at-fault driver.
Some Releases also include the name of the at-fault insurance company. When you sign the Release you give up your claims against Allstate from this particular accident. Unless you modify the Release you could be giving up your UIM claims also.
So read the Release carefully, and, if you haven’t yet consulted with an experienced injury attorney, this would be a good time to do so.
Conclusion
There you go, verify coverage, check for UIM insurance, perform an asset search if needed, get a waiver of subrogation, obtain consent to settle and read the Release. Modify it as needed.
Disclaimer
This article is intended to acquaint you with the issues that arise when handling a policy limits offer in an injury case. For best results seek advice from an experienced injury attorney to help you through the policy limits minefield.
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