Auto Insurance Claims: insurance payout, insurance payout, insurance commission

Question
My son was involved in an accident in May 06 that involved him being hit in his car by a boy on a motorcycle. The accident was determined to be the fault of the boy on the motorcycle by both insurance companies and the state police(after much investigation).My son was not injured but the other boy had extensive injuries and his medical bills exceed $500,000. He decided to sue my insurance company because he claimed the accident to be my sons fault.My insurance company decided to make a settlement and paid him $25,000 so that it wouldn't have go to court.They state they were afraid if my son was given 10% liability for the accident they would be out a greater amount of money. Since my son is only 19, his premium has now doubled because of this claim. Is this fair?  

Answer
Hi Sharon,

I have no way of knowing all of the details of this negotiated settlement. However, if they agreed to accept 5% liability that means that they agreed that your sone was 5% at-fault. As a result it is being looked at as an at-failt event for premium determination. If all parties initially agreed that your sone was not at fault, you should strongly protest this.  The insurance apparently decided to settle to avoid the costs of litigation (to save themselves money).  You may want to contact your state insurance commission to see if anything can be done about this.

I hope this helps
Richard Hixenbaugh