QuestionI was involved in a auto accident back in FEB. The question I have is my medical bills $55,000 exceeded the other person limits $20,000. I do have uninsured/underinsured coverage $20,000. Can my health insurer get in money from any settlement? They do have a lien on it. So is it possible that I won't get any money for pain and suffering?
Answer
Dear Derek,
You have three issues, which I will take up in the following order. You have a VERY SIGNIFICANT CLAIM if you have $55K in medical bills.
1. Can you get your own UIM amount in addition to his, or is your policy limit so low that when you deduct the tortfeasor's limits you will get nothing for a UIM award?
2. Should you settle the tortfeasor's claim for his limits, or should you go after his assets in addition to the policy?
3. How can you thwart any subrogation attempt by your health insurer?
FIRST, learn about policy limits cases. Directory of Legal Information Liability Insurance Policy Limits Settlements in Personal Injury Insurance Injury Claims http://www.settlementcentral.com/page0451.htm This stuff is not rocket science, but it does require some reading and some work on your part. Still, the savings in a big and obvious claim such as yours is tremendous.
Ask your own company whether or not they can claim the offset of the tortfeasor's policy so that you have no UIM recovery. NEXT TIME BUY INSURANCE TO PROTECT YOURSELF AGAINST THE NEGLIGENCE OF OTHERS—ALWAYS think ahead: The Smartest Way to Buy Auto Insurance http://www.settlementcentral.com/page8006.htm
Also consider the information regarding high UIM coverage in Smart Protection Auto Insurance http://www.settlementcentral.com/page8008.htm
SECOND, figure out whether or not this tortfeasor has any assets that are in excess of your state's exemptions for bankruptcy. The tortfeasor can discharge your judgement in bankruptcy (unless he was committing a crime such as DUI at the time). He gets to claim as exemptions some value in his home, some limited value in his car, some tools, some cash, etc.
But, as to the rest of the assets, they are subject to execution to satisfy your judgement. In other words, you get to sell them and take the proceeds in partial payment.
But, if he is driving an older car or lives in a not-too-upscale neighborhood or has just minimal state policy limits, what are the chances that he has any real assets that you could go after?
If you want to take a crack at it, contact an attorney. If not, proceed to settlement.
THIRD, do you get any subrogation relief? That, my good citizen, depends upon whether or not you were an intelligent voter who elected people who listen to trial attorneys. Or did you elect conservative legislators who are in bed with the insurance industry?
SUBROGATION RELIEF VERSUS CLAIMS OF YOUR INSURER(S) WHO PAID MEDICAL BILLS.
Many states, mostly "blue" states, have classified subrogation as an equitable relief for the insurers, irrespective of what the insurance policy says. That means if you have a tortfeasor with limits of $20,000 and your insurer(s) are claiming $55,000 in subrogation for medical expenses paid to your doctors, but your claim for general damages (pain and suffering, loss of enjoyment of life, etc.) is obviously far in excess of that minimal limit, then you get to keep the entire $20,000. As to that particular policy, the subrogation claim is secondary and will not be paid. This is called equitable relief.
YOUR VOTING MAKES A DIFFERENCE; KEEP (or make) YOURS A "BLUE" STATE!
Hey, give thanks that you voted "blue" if you did because in many "blue" states where the voters elect those who favor consumers over the insurance industry, subrogation is an EQUITABLE RIGHT. That means that if you do not have a tortfeasor limit high enough to cover your general damages (i.e. pain and suffering, loss of enjoyment of life, etc.), then you can block out subrogation entirely.
For those of you who live in "red" states, learn how you lose with your voting. Ohio is a good example: you are a "red" state that elected those who are in bed with the insurance industry. And hence you have no chance whatsoever of getting any equitable relief on subrogation. Your conservative officials have seen fit to ignore the pleas of your state's trial lawyers and arranged for the insurance industry to get first and last dollar subrogation relief, irrespective of the equities of the case! Those conservative legislators dance to the tune of the insurance industry and make you honor their contract; this is called a "legal" solution.
But for Washington and some other "blue" states, here is how the court summarizes the equitable right of subrogation versus the insured's right to be made whole (payment of general damages) before insurers get a dime.
http://www.courts.wa.gov/opinions/?fa=opinions.opindisp&docid=329468MAJ
" But this right to (insurance company) reimbursement is subject to the rule that an insurer may not recover before the insured has been fully compensated (ie. Winters v. State Farm Mut. Auto Ins. Co., 144 Wn.2d 869, 876, 31 P.3d 1164, 63 P.3d 764 (2001); Mahler, 135 Wn.2d at 416-17. This rule was first announced in Thiringer v. American Motors Insurance Company, 91 Wn.2d 215, 588 P.2d 191(1978), in which the court stated that an insurer may recover 'only the excess which the insured has received from the wrongdoer, remaining after the insured is fully compensated for his loss.' Thiringer, 91 Wn.2d at219."
You can discover your own state's rules on subrogation by asking your state insurance commissioner http://www.settlementcentral.com/links.php What you are seeking is whether there is case law authority that subrogation is an EQUITABLE RIGHT, as opposed to a legal right (in which case your contract with the insurance company will prevail, irrespective of the equities involved).
NOTE: irrespective of how the insurance commissioner answers, DO NOT LET THAT STOP YOU FROM MAKING THE CLAIM FOR EQUITABLE RELIEF. Read the case I cited and copy some of the language I cited and just make the written argument for equitable relief.
Do not give in. Do not let them intimidate you. Maybe they would make a split of the $20K with you if you hold out long enough and keep sending them letters citing the case I gave you.
MAKE THE INSURANCE COMPANY SEND YOU A DENIAL IN WRITING WITH ANALYSIS. Take THAT to your legislator and ask him why he did not arrange for you to have any relief.
Communicate with the health insurance adjuster in writing, showing your own analysis of value. It is fine to meet with him or her, but have your ammunition in writing to give to the adjuster.
Let him know that you are FIRM IN YOUR RESOLVE to get what you are demanding (NOT "asking", since that invites a counter-offer, but instead "demanding" as fair and reasonable compensation) by asking him what the options are to resolve the matter fairly should he not agree to a reasonable subrogation claim relief. In other words, let him know that you will go through with a court filing if need be.
Remember these tips, do your homework, print out your evidence, show resolve to get your fair settlement, and you will DO JUST FINE.
I trust that my extra time here has produced some information that has been of value to you, and thus I would respectfully request that you locate the feedback form on this site and leave some feedback for me.
Best Wishes,
Dr. Settlement, J.D.
http://www.SettlementCentral.Com
