If your insurer is not playing fair—unreasonably denying or delaying your car accident claim—you may have a case and it may be time to consult with a bad faith insurance lawyer.
In these cases, it is possible to recover more than a policy’s limit of coverage.
Bad faith occurs when the insurance company could have settled within the policy limits but fails to do so. There are basically two sides to insurance bad faith concerning Florida car accidents:
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- First Party Actions – Your UM Carrier.
Example: Driver A is has no insurance. Driver A rams into your car, injuring you. To recover costs associated with the accident you turn to your own uninsured motorist (UM) But your UM provider does not play fair, and refuses to settle your claim in good faith. This is a “first party” claim. And it is a totally different procedure than the other side of bad faith, which is: - Third Party Actions – the At-fault Driver’s Insurer.
Example: Driver B is insured under a bodily injury liability Driver B hits you head-on, causing you serious injuries. You make a demand on Driver B’s insurance. That insurance company does not play fair. They fail to settle your claim in good faith within the policy limits, in a way that is favorable to the insured (Driver B). This exposes Driver B to liability beyond the coverage limit. The process your attorney follows in this case is distinctly different.
Let’s look at how a bad faith insurance lawyer would pursue damages for each type of action.
Bad faith becomes the most important tool in the personal injury attorney’s arsenal. It is the only thing that gives a lawyer genuine leverage, because it enables the injured victim to recover more than policy limits.
First Party (Uninsured Motorist) Bad Faith:
In a first party bad faith claim, you look to your Uninsured/Underinsured Motorist carrier to cover damages for your injuries and medical costs, up to the limits of the policy. But your carrier fails in their duty to exercise good faith and fair dealing toward you. They either wrongly deny coverage, unfairly underpay your loss, or drag their feet, drop the ball or otherwise improperly fail to pay.
Scenario:
The Accident: On your way to the store, a driver speeds through a caution light and hits you broadside. The collision leaves you with limited mobility in your left arm and severe internal injuries including kidney damage. You are forced to stop working. Your injuries, medical costs and loss of income quickly surpass $500,000. The negligent driver does not have bodily injury insurance, therefore there is nothing to recover.
The Claim: You have $50,000 UM coverage under your own insurance policy. Your attorney files a claim against your UM for the policy amount. Your attorney also provides exhaustive medical records and the necessary documentation to show that the claim is meritorious and the value of the claim is even beyond the policy coverage.
The Bad Faith Action: Despite all of this, your carrier refuses to pay its policy limits. Your lawyer may now sue your insurance company for bad faith for failing to honor the coverage under the UM policy.
The Process Your Lawyer Must Take: Proceeding under Florida statutes, your attorney files a civil remedy notice. Once the notice is filed, you must give the insurance company 60 days to correct the violation by paying the damages, or by otherwise correcting the circumstances that led to the bad faith action.
After 60 days, if the insurance company still does not pay, your attorney can file a separate suit, claiming bad faith. In that bad faith suit, you name the insurance company.
This is important because it gives you a great advantage in front of the jury. Now the jury learns that you are suing the insurance company for damages, and not a person who might become impoverished by having to pay out massive damages.
The silver lining in a bad faith case: Florida statute permits recovery of the excess verdict in a first party bad faith claim. In other words: once you have a bad faith claim, the recovery is no longer limited to the amount of the policy.
So, although you have a $50,000 UM policy, if your insurance company acts in bad faith and you have a million-dollar injury, you could recover the million dollars.
Speak with an experienced Florida attorney at our firm today.
Call 855-Kramer-Now (855-572-6376).
Third Party (Bodily Injury Liability) Bad Faith
In a third party bad faith claim, you look to the other driver’s insurance to cover damages. If a motorist hits you causing injury, your lawyer makes a demand on their insurance within policy limits. When their insurer does not pay when they should, they are practicing bad faith.
The process that ensues in this case is completely different.
Scenario:
The Accident: You are hurt in a car wreck and the liability is clear – the driver that hit you is obviously at fault. That driver has $100,000 in bodily injury coverage.
The Claim: You have $1 million in injuries. You have suffered traumatic brain injury, you have developed heart trouble and must also undergo spinal surgery. Your attorney has compiled proof of damages including documentation from your neurologist, neurosurgeon, cardiologist, general doctors and physical rehab specialists. You have been seen by every doctor you can possible go to, you have tried every viable form of care and treatment.
The Bad Faith Action: Your attorney makes a demand to the insurance carrier requesting payment for the policy limit of $100,000. They do not pay. You attorney gives them every opportunity to pay, including extensions. They still do not pay.
That is a classic third party bad faith action. The insurer should have settled and did not.
The insurer is acting in bad faith towards the driver who owns the liability coverage, not you. By acting in bad faith, the insurer is subjecting its own policyholder to an excess judgment—damages that exceed what the insurance policy covers. The at-fault driver is now personally liable to pay you.
The Process Your Lawyer Takes: In this case, you and your lawyer have to sue the at-fault driver, and their insurance company defends them.
Again the silver lining. Florida statute permits recovery of the excess verdict in a third party bad faith claim. If your lawyer gets an excess verdict—more than what the policy covers—your lawyer is able to file a second lawsuit against the insurance company for using bad faith.
Now you can recover the total amount your injury is worth rather than being limited to $100,000. So if your injury is worth $1 million, you can get that.
Not All Claim Denials are Situations of Bad Faith
A denial or delay of insurance benefits does not always constitute the act of insurance bad faith. For example:
- If an injury, death or other loss is not covered by your policy, the insurance carrier is not compelled to pay.
- In settling an insured’s claim, under the law insurance providers do have limited discretion.
- There are times when an insurer makes an error in its claim evaluation that, although incorrect, the error was based on reasonable grounds.
Bad faith only becomes a factor when there is “unreasonable” and “unfair” conduct by the insurance company.
Ask a bad faith insurance lawyer your questions:
An entire body of law is dedicated to bad faith. The attorneys at TK Law are experienced in these cases. We serve policyholders and injured third parties throughout Orlando and Central Florida who have legal needs resulting from disputes with insurance companies.
Contact us without delay to discuss your case with a resourceful personal injury lawyer who is ready to assist you. Let us help you move forward by taking proper legal action.