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If I am sued as a doctor, am I obliged to allow my malpractice insurer to dictate the terms of the settlement?

Austin, TX |

I was recently sued by a former patient, and I wanted to know...does the insurance company have the right to basically take over the trial process? If I want an immediate settlement that is within my policy limits is the insurance company obliged to respect my decision, or can the insurer decide to go to court against my will?

Attorney Answers 7


  1. It depends on your policy, but usually the insurance company wants to settle but the doctor won't give his consent.

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  2. That's a very good question. It all depends on the policy. Many medical malpractice insurance policies have "consent" clauses which don't allow the insurance company to settle without your consent. You are asking about the opposite scenario. If you truly want to resolve the claim within your insurance proceeds and the carrier isn't agreeing, I recommend hiring personal counsel to protect you in the event a judgment is taken against you in excess of your insurance limits. Another way to make the insurance company resolve the case is to admit that you're responsible and your negligence caused the alleged harm.


  3. Depends on your contract, but best bet is to retain local independent counsel to protect your interest and assets.......


  4. You should have an independent attorney review your insurance policy. The insurance company will settle for an unreasonable amount even if you instruct it to do so. The consent for settlement in a medical malpractice case is usually withheld by the physician. However, if you want to settle within your policy limits, you should instruct your insurance company and the lawyer that was hired to defend you, to settle the case within your policy limits. You may also want retain independent counsel to ensure that your are not exposed to any excess judgements outside the scope of your insurance policy.


  5. Notwithstanding your desire to see the claim settled, your insurer may view the claim as a defensible one that they'd rather take to trial then settle. Danirl Horowitz' suggestion that you retain personal counsel to review the policy and oversee settlement discussions is a good idea.

    Disclaimer: answers posted by attorney Daragh Carter to questions posted on AVVO are NOT privileged or confidential and will not and should not be construed to create an attorney-client relationship between attorney Daragh Carter and you or anyone else.


  6. You have been given excellent advise on here.

    You should hire your own counsel and discuss this with them. They can advise you on the best course of action. The most important thing is to protect yourself in case the insurance company refuses to settle and the eventual judgment exceeds the policy limits.

    Good luck.


  7. Insurers do have a lot of leeway in handling claims. However, there is a caveat. Do a Google search for "Stowers Doctrine." That's the doctrine in Texas that protects insureds from the unbridled discretion of insurance companies.

    I hope this information answers your question. If you need more information, simply add a comment or call me. Good luck!

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