Auto Insurance Claims: Asset protection, ethical obligation, collapsed lung

Question
Hi Claims Guy,

I was involved in an accident last year with a bicyclist in southern California. My insurance company has deemed me 100% at fault for the accident. The bicyclist apparently suffered from really bad injuries (broken bones and collapsed lung) and was hospitalized twice (first time for the accident, second time for infections from his injuries).

I know the other party has already hired an attorney and wants to know the limit of my policy. My insurance company keeps on telling me that the settlement may cost more than my policy limit which is $100k. I am really worried because this is my first accident ever. The car I drive is under my mom's name and so is the insurance policy. My mom has some assets (house, cars, etc), and I currently do not own any assets (I am 24 and just started working).

If my settlement ends up being more than $100k, is it possible for the other party to force my mom to pay? What should I do to protect myself and most importantly, my mom? I really don't want my accident to affect her. Do you have any other suggestions for what steps I should take?

Thanks a million for your help!!!

-J

P.S. I hope you won't get offended if I ask for a second opinion on this site.

Answer
The best thing you can do at this point is ask your insurance company to assign a defense attorney to your case.  Do this in writing now.  If a lawsuit is filed against you, they will be obligated to assign an attorney to defend you.  Althought the insrer pays the attorney, and he may even be their employee, he/she is your attorney and has a legal and ethical obligation under the bar to represent your interests over the insurer's interest.

Sometimes, they will do this before the lawsuit is filed if legal advice is needed.  In my opinion, this is one of those cases.  You need legal advice now.  If you put this in writing, they will be obligated to show you good faith and do this.  In your letter, mention that you want them to act in good faith and protect your interests.  This will get their attention.

As to whether or not your mom has any exposure, that will depend on the law in your state and your attorney can answer this  question.  There is not much you can do to prevent an excess verdict, other than place your insurer on notice of your expectation that they act in good faith in protecting your interests.  

I recommend higher liability insurance limits in the future to avoid this scenario.  It does not cost that much more and it is well worth it.  If you or your mom have any assets, you should have maximum policy limits and also purchase a 1 million dollar umbrella policy.  It is well worth the cost.