Florida Supreme Court Rules Injured Person May Pursue Damages on Underlying Underinsured Motorist Case Before Litigating Bad Faith Action Against Insurance Company

The Florida Supreme Court recently issued an opinion, Fridman vs. Safeco Ins. Co. of Illinois (No. SC13-1607), regarding damages for a motorist who suffered injuries in an accident with an underinsured (UM) motorist. The injuries included herniated spinal discs, a damaged spinal nerve root, and carpal tunnel. The injured party filed to receive his $50,000 limits under the UM policy, but his insurance company refused to pay the benefits, even though there was clear liability and over $12,000 of property damage and $16,800 of medical bills.
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The injured motorist then filed for a determination of liability under the UM policy, followed by a notice of settlement, both of which went unanswered by his insurance company until right before a scheduled jury trial. Two checks of $50,000 were issued at separate times to the insured, which were both rejected by the injured person. The first contained settlement language, but the second did not. The injured person proceeded to trial, where the jury found the underinsured motorist liable and issued a verdict for one million dollars. The trial court let the verdict stand, but the Fifth District appellate court overturned the verdict, ruling that the injured person was basically limited to the policy limits and that the injured person did not include a bad faith count in his complaint. The Fifth District appellate court felt that the injured person could pursue the bad faith damages, but only after the initial claim had been settled within the policy limits, absent any dispute over the limits themselves.

The Supreme Court reviewed pertinent case law in its decision, first acknowledging that most bad faith lawsuits are third-party claims, brought by injured people who are alleging the insurance company of the at-fault driver did not settle within policy limits, or breached its duty to settle in good faith. In 1982, the Florida state legislature enacted a law that created the right of an insured to sue his or her own insurance company for failing to act in good faith, allowing damages that are “foreseeable.” Case law clarified this, specifically allowing damages in excess of the policy limits.

The Supreme Court ultimately determined in this case that the injured motorist was allowed to file his case without addressing his first-party bad faith action, and that the jury’s determination of damages in excess of the policy limits was binding against his insurer. The Supreme Court highlighted the dissent in the lower appellate court’s opinion that the insurer should not use this opportunity through bad case law decisions to let injured parties burn through resources and energy while preparing for trial to delay payments to which the injured person is entitled under his or her policy. The case was remanded to the trial court for the reinstatement of the jury verdict of one million dollars.

The Florida car accident attorneys at Donaldson & Weston know that insurance companies want to pay as little as possible for your accident, sometimes denying injured parties the damages they deserve. Our firm will aggressively pursue all avenues of financial and legal relief so that you can return to health and financial stability as soon as possible. For a free, confidential consultation, call our office at 772-266-5555 and 561-299-3999.

More Blog Posts:

Florida District Appeals Court Reviews Notice Requirements for Insured to Receive Personal Injury Protection Benefits, South Florida Injury Lawyer Blog, October 13, 2015

Knowing How a Rejection of Uninsured/Underinsured Auto Insurance Coverage in Florida Affects You and Your Family, South Florida Injury Lawyer Blog, October 6, 2015