QuestionHi there!
I was involved in an accident with a motorcyclist, and was found to be 100% at fault by my insurance company. The motorcyclist suffered a broken leg in the accident. He has retained a lawyer, and I've gotten a letter from my insurance company asking me to release my policy limits and another letter stating that the motorcyclist is asking for more than my insurance policy covers.
What does all this mean? Should I release my limits? I'm guessing that he's going to personally sue me for the difference.
Thanks in advance!
Lily
AnswerHi Lily,
I can tell that you are worried, so I am going to put in some extra time for you to let you know NOT to worry. This is not so tough as you might think. There is going to be a claim versus YOU. That we do know. But will it be against your personal assets? Maybe not. Here is what happens.
First, you will agree to release your policy limits information to the claimant. That way he can plan what to do. First, he will know if he has an Underinsured Motorist Claim (UIM), versus his own insurance.
If he has UIM coverage, then chances are that he will simply leave you alone and he will claim versus his own UIM. What does that mean for you? He will first have to obtain permission from his own company to settle your claim so that he can get your policy limits award.
If his company agrees to that policy limits settlement, then that is the end of the issue for you. He will sign a release and settlement agreement and you will FOREVER be off the hook. His own company does NOT have any cause of action versus you in that case since he signed the release agreement. Hence, his insurance company is bound by his release.
Here is a page of free legal information on insurance policy limits http://www.settlementcentral.com/page0451.htm personal injury awards.
NOW, what can go wrong with this scenario? First off, maybe he has no UIM, or second, maybe his company will not agree to let him settle the policy limits claim. What would happen then?
Well, the first thing is that you will be asked to give an assets report to your insurance adjuster so she can show it to the plaintiff and convince the plaintiff that you do not have sufficient assets to warrant going through a lawsuit and collection efforts. Be sure to SHOW ALL OF YOUR DEBTS when you complete the asset report since it is the NET assets they are interested in.
Your state has a lot of exemptions from execution on a judgment. For example, each state has a homestead allowance for your home. Plus a car and cash and a lot of personal property is exempt from judgment. Thus, you would have to have a lot of assets before the plaintiff would ever have any interest in suing you.
IN ADDITION, you have the protection of the bankruptcy court should they obtain a fantastic judgment. Unless you were committing a crime (other than a driving offense) when the accident occurred, you can discharge the judgment in bankruptcy court.
BUT I SAVED THE BEST FOR LAST. You have two good defenders to help you. First off, your own insurance adjuster will work hard to settle this case for policy limits. And there is a high probability that he will be able to do just that.
Second, and even better, you will have a free attorney to defend you. She will work totally for you to keep any judgment from ever harming you. The insurance company will pay for all of her expenses, including hiring defense doctors to examine the plaintiff. By the time they get done and head toward a trial, it is most likely that the case will settle for policy limits.
Hence, Lily, I hope that I have given you some hope that you will not be subject to any personal exposure to lose any of your assets. I trust that my time here has produced some information that has been of value to you, and thus I would respectfully request that you take the time to locate the FEEDBACK FORM on this site and leave some feedback for me.
Best Wishes,
Dr. Settlement, J.D. (Juris Doctor)
http://www.SettlementCentral.Com
