Greensboro Car Wrecks Cause us to Compute Liability Limits
Every driver in North Carolina is required to have some form of liability insurance. Liability insurance is here to protect you if you are at fault for a car accident. It is also a source of compensation in a wrongful death case caused by a Greensboro car crash because the dead person’s family can bring a claim against the at-fault driver’s liability coverage through the auto insurance policy. This policy is not the only possible source of compensation for a victim.
If a person is driving/riding and kills or hurts someone, the driver’s liability insurance provides the driver with an attorney, and will pay a settlement of whatever amount to which the plaintiff is entitled, up to the driver’s policy limits, if the driver is found to be at fault. The driver will not need to pay for this attorney – the insurance company has a duty to pay the defense lawyer’s cost, from the premiums the driver has already been paying. This is one of the benefits that an at-fault gets from the premiums they pay to an insurance company over many years.
The liability insurance contract allows the insurance company to control the lawsuit. Sometimes they may make courthouse decisions the driver does not agree with. They can certainly do such a thing.
The law says that a person’s liability insurance has to take care of the insured client. The insurance company has to care about the insured person and his best interests. For example, if someone is going to sue a driver for $300,000, and the driver’s policy limit is only $200,000, the insurer has a responsibility to do whatever it can to settle the case for only $200,000. This is so the driver won’t have to pay the extra $100,000 out of his or her own bank account funds.
When a liability company does not take good care of the person they are insuring, that person sometimes can sue his or her own liability insurance company. This is called a bad faith claim, because the insured believes that her insurance company did not treat him fairly.
One thing that is really important in a situation like this – where a person is entitled to $300,000, but the driver only has $200,000 in insurance – is determining if there is any way to get more money. Sometimes a person has another insurance policy, sometimes called an umbrella policy.
However if there is no more insurance, then it becomes really important to find out the assets the person has personally. For example, if Warren Buffett runs a red light and kills someone, but only has $100,000 of insurance (this is very unlikely of course), then the insurance company could pay the $100,000, and then Warren Buffett could cut a check for the additional amount that is due.
In most cases, though, getting that really large check from the at-fault driver is a much more difficult thing to do. For most people, there is never any hope of that ever happening.
If a person is in a rich group then it makes sense to sue them personally for amounts above their insurance policy limit, because you will be able to collect the money if you win. But rich people usually have lots of insurance, so it doesn’t happen much.
For people in another group (the poor group), it makes no sense to sue them in person; you’ll never get the money out of them. Sadly, with these people, you probably just have to take the policy limit and be done with it, knowing that justice was never done, but that there is no practical or legal maneuver to get more justice/money.
If the defendant is in the middle-class group, then you will have a hard decision to make. If you get a judgment against the person for $300,000, but they are not good for paying it, and you have to get a collection agency to get the money, you’ll probably only recover with half the amount, or even less, and only after many years of fighting about it.
Some people, very understandably, want to make the defendant hurt; to punish the bad actor. This makes sense to almost everyone. The defendant killed someone or hurt someone, they must be punished. However, hurting them by trying to get a judgment that they can’t pay, is only a good idea once in awhile. Sometimes it can end up hurting you more than the at fault driver. Talking about when exactly this is a good idea is beyond the scope of this section, and will be different for every person depending on the exact situation, but this is something you should talk about with your lawyer if the money situation of the defendant and their insurance policy limit puts you where you have to make this decision.
Contact our Greensboro Car Accident Lawyers today if you or someone you know has been involved in a car accident in Greensboro, High Point or Asheboro.