If you are injured in a car accident, you may envision that the only person that you need to take legal action against is the driver who caused the accident. However, oftentimes insurance companies will also need to be brought into court in order for them to pay the damages that they owe. Even if your insurance company seems cooperative, they may just be trying to get you to settle for less than you deserve. If you are injured in a car accident, you should contact a knowledgeable South Florida personal injury attorney as soon as possible. They can help you to decide whether you should take the settlement offered or if you need to involve the insurance company in legal action.
The Car Accident
A man was driving on a Florida highway with his friend in the passenger seat. The driver fell asleep at the wheel and crashed into a cement barrier. While the driver was not injured, the passenger suffered serious injuries and was paralyzed from the waist down. To complicate matters even more, the car itself was owned by the driver’s father’s business. The insurance policy included a one million dollar garage liability policy and a two million dollar commercial umbrella policy.
The Insurance Company
The insurers of the car attempted to contact the injured man and access his medical records over a number of weeks. They found out that he was seriously injured and his injuries may exceed the three million dollar insured amount. The insurance company allegedly also told the injured man’s father that he should not hire an attorney as they would just take some of the money. After a few months of going back and forth with the insurance company, the injured man decided that he was not willing to settle for the policy limits of three million dollars.
Owner of the Vehicle
The injured man decided to hire an attorney and sued the owner and driver of the vehicle. After court ordered mediation there was a potential settlement agreed upon where the insurance company would pay the three million dollars and continue to represent the driver of the vehicle in the litigation, and a $30 million consent judgment against the driver. The three million dollars from the insurance company would release the business that owned the car from any liability. As part of the settlement, the injured man was given the right to sue the insurance company for bad faith. Notably, the insurance company never formally agreed to or signed this settlement.
Florida law prohibits insurers from acting in bad faith. Therefore, they have a duty to defend their policyholders in a prudent manner. Significantly, this requires the insurance company to settle in cases when a “reasonably prudent person” would, based on the available information. If they do not fulfill this duty than the insurance company can be brought to court, as happened here.
In this case, the court held that there needs to be an “excess judgment” in order to go after the insurance company for bad faith claims. In other words, the final judgment must be greater than the proposed settlement. However, in this case there was no final judgment because there was no verdict. The court thus held that not only was there not an excess judgment as needed to support the bad faith claim, but that the insurance company never consented to the settlement. Therefore, the court dismissed the case.
Contact an Experienced South Florida Car Accident Attorney Today!
Insurance companies sometimes try to underpay victims of car accidents. The knowledgeable South Florida car accident attorneys at Donaldson & Weston have experience fighting against insurance companies to help car accident victims get the compensation they are due. Contact us by using the contact form on this website or call us at 772-266-555 or 561-299-3999 for a free and confidential consultation today!
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