Legal & Ethical Obligations of Insurance Companies

The Legal and Ethical Obligations of Insurance Companies

If you’re injured in a vehicle crash and the driver who hit you is insured, their insurance company will be involved in both settlement negotiations and a trial (if one is necessary).  They will be hiring the lawyers to defend their driver.  They will be responsible for paying damages (at least up to the policy limits of their driver).  The other driver who hit you will have very little (or no) control over whether a settlement should be made so long as it is the insurance company that will be paying the bill.

This page discusses the obligations of insurance companies, so that you will better understand the litigation process.

The Insurance Company of the Driver Who Hit You

If you’ve been injured, you should understand that the insurance company for the driver who hit you has no legal or ethical obligation to you, even if the other driver has the same insurance company as you do.  If you and the driver both have the same insurance company, there will be separate adjustors responsible for handling the claims of each policy holder.

The insurance company for the driver who hit you will be adverse to you.  You should expect that they will do anything within the confines of the law to minimize their liability and loss.  They may blame you for the crash.  They will usually try to minimize damage that result, including the pain and suffering.

My role is to get you full compensation from those responsible.

Your Insurance Company

If you’ve been injured by an uninsured or underinsured driver and you have uninsured or underinsured coverage, your insurance company has a legal obligation to treat you fairly. This means that they must investigate your claims promptly, and also promptly pay your claim if it is covered under your insurance policy.  If they act outrageously – such as by failing to promptly pay your claim when they have no legal basis for not paying, they can be liable for what is known as insurance bad faith claim.

An insurance bad faith claim may only be brought by a person against their own insurance company, and only if the insurance company acts in a deliberate and outrageous manner.  This might include routinely denying all claims without investigation, not timely investigating claims, or other conduct in which they clearly put their interests ahead of their policy holders.

If they don’t treat you fairly, you might have an insurance bad faith claim.

It’s important to immediately seek all benefits to which you are entitled under your insurance policy.

If you’ve been injured at work or by someone else, please call me to find out how I and my firm can help.  I offer a free consultation, and there is no fee unless you recover.

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