I was involved in an accident in CA where a motorcycle hit me when traffic slowed. His foot was eventually amputated, as his bike fell on his foot. The officer on the scene said I was not at fault as I slowed for traffic and the motorcycle hit me. However, I have received a request from his attorney for my policy limits, which is $25,000 for bodily harm. What is the benefit and costs of both disclosing and not disclosing. Thank you!
For some odd reason, policyholders think that revealing their limits when asked by the other side is tantamount to giving up the ghost. That is wrong, because the reason the other side wants to know is to determine how to proceed on the claim.
For example: Assume you cause an accident and seriously injure someone to the tune of 40,000 in medical bills, and you only have a 50K per person policy. The injured party's lawyer will definitely ask for disclosure of your policy limits. Why would you refuse? It is uncooperative, and in my opinion, rather mean spirited. More on point legally, it can result in the filing of a lawsuit, which could be avoided by simply letting the other side know what they are dealing with in terms of policy limits. In this example, if you reveal that you only have 50K, the other side will likely make a policy limits demand, and your insurance company will resolve the claim. If you don't disclose your limits, the injured party may feel forced into suing you personally to get to discovery, which would compel policy limit disclosure.
Please understand that just because you disclose your limits does not mean that the other side is going to automatically get those limits. If you have 50K per person, and the injured party only has a 30k claim, that is what they will get. Insurance companies are not in the business of paying out policy limits UNLESS liability and damages warrant it. In your case, there may be other issues like comparative negligence which could impact your liability. If the injured party can successfully argue that you are 20% liable, he may have a policy limit claim against you. I do not know enough about your facts, but an amputation is a serious permanent impairment. It will be up to your insurance company to decide how to handle the claim, depending on the facts and legal merit.
In short: disclose your limits. It helps your insurer do its job, and it allows the other side to realistically assess liability. In my practice, the policyholders who actually get sued are usually uncompromising in their refusal to disclose their policy limits. A lawsuit changes their position more often than not.
Melissa Mack, Esq.
If you have not already given the letter from the attorney to your insurance company, you should promptly forward the letter to your carrier. At this point, you are under no obligation to provide your policy limits. However, if you are sued you would then have an obligation to to disclose the policy limits. Disclosing policy limits generally aids in resolving claims.
Ultimately fault will be readdressed by your insurance carrier in settlement negotiations with the other side, or ultimately in court, if the other side files a lawsuit. While the police report may not assign fault to you, your insurance comany, a court, or jury may decide that you are liable if the other side provides sufficient proof. I have obtained a number of settlments for clients when police reports assigned liability to my client.
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I believe in disclosing limits in a situation like yours. There are benefits and costs as noted by the other lawyers who have answered. However, with this serious an injury, there is going to be a lawsuit and therefore they will find out in the process of that lawsuit. Good Luck
Melissa Mack's answer is right on the money......I would think that in a case such as yours, it is quite likely that your company would pay the limits REGARDLESS unless there is 0 chance of any possible liability on your part. As the others stated, an amputation is very serious and even if you were 10% at fault, the case could certainly have a "value" in excess of $250,000 making your limits irrelevant provided your company paid.
Here is where it gets really messy: Suppose your carrier receives a "policy limits demand" and thereafter refuses to pay the limits. Then, you are sued and for whatever reason, a jury finds for the bike rider and awards him $50,000. Yes, you got a "free attorney" to represent you, BUT, now you are on the hook, potentially for the balance......you would then have to file a bad faith claim against your carrier for refusing to pay the limits. IF THEY DID offer the limits and they were not accepted by the bike driver, then you would absolutely be liable for the balance IF the jury said so......
My favorite cases involve "bad faith" by insurance companies. They (insurance companies) usually are horrible.
Disclosing the limits is neutral for you. Your insurance company will eventually disclose with your permission. You should get a copy of the police report to set your mind at ease that your were not found to be at fault by the traffic officer. You should tell your insurance company about the contact by the lawyer. It is odd that he contacted you since your insurance information would be in the police report.
Tell the lawyer to sue you. Most lawyers are scared to sue anyone. Few very lawyers are real lawyers who litigate cases. If you get sued, simply turn over the papers to your insurance company to resolve.
The answer does not create an attorney/client relationship and is for informational purposes only.
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