If my damages exceed my UIM coverage, what could I do? The insurance company of the Under-insured Motorist offered the policy limit and asked me to sign release. But my injuries / damages sustained exceed the liability insurance of at-fault driver and my UIM coverage. I know that my UIM carrier should be asking for subrogation. So does this mean I am in second place any way (after my insurer)? Can any judgement (if successful either by my UIM carrier or by me) be easily discharged totally via tortfeasor's bankruptcy? We will do asset check.
I agree with Mr. Daymude's response. When you start talking about UM and UIM matters, the law can get complicated. You should consult with a personal injury lawyer in your area.
Here is my my understanding: in order to bring a UIM case, you must settle the underlying claim for the policy limits. The third-party carrier will require that you sign a full release. Then you can bring your UIM claim. This process protects the third-party driver from a subrogation lawsuit by the UIM carrier. Remember, if your UM policy limits are the same as the 3rd party liability limits, you cannot "stack" your UIM policy on top of the 3rd party limits.
Whether or not it is worth pursuing the tortfeasor requires consultation with an experienced personal injury lawyer. And yes, a judgment can be discharged in bankruptcy. Thus, a legal consultation is even more important. Good luck.
Going after personal assets is always easier said than done. Having said this, you should at least run an asset check on the at fault driver prior to settling with them if they have a low limit policy. My colleagues are correct that you will need to exhaust the at fault driver's policy prior to being able to collect on any UIM coverage. A quality personal injury attorney could assist you with these issues.
“If my damages in a car accident exceed my UIM coverage, is it worthwhile to go after the under-insured motorist's assets?”
Probably not -- but that is a decision you should make in consultation with your own lawyer. You mention nothing about percentage of fault, your damages, your coverage, the terms of your policy, or whether you are the only injured party who will recover under the policies -- all of which could impact the amount you will ultimately receive under all available coverage.
You should, therefore, not attempt to answer this question in this forum but instead consult a personal injury auto-accident lawyer for advice and counsel specific to your exact situation and facts.
Your UIM coverage only kicks in after settlement for policy limits or excess judgment. While consent for settlement is not required in CA, you should attempt to obtain consent from your insurer and determine what is required of you in order to make a UIM claim under policy before you settle the claim.
Assuming you and your carrier agree that your damages exceed the limits of the other driver’s liability insurance and your UIM coverage also exceeds the limits of the other driver’s liability limits – you have a UIM claim for the difference. For example, assume liability limits of $15K and UIM limits of $50K. Your UIM claim would be $35K.
If you do not settle for policy limits and instead obtain a judgment against the underinsured driver of $100K -- you would receive $15K from the other driver’s insurance, $35K from your carrier under your UIM coverage, and would have an outstanding judgment for $50K.
Assuming that sum was collected, who would get it? IMO, it would be yours and your carrier would have no interest in it because that would defeat the purpose of the anti-subrogation rule which states that an insurer cannot be subrogated against its own insured. However, I suspect not all attorneys will agree and the exact terms of your policy might cause me to change my opinion.
Could the $50K excess judgment be discharged in bankruptcy? Absolutely, unless nondischargeable because the driver was drunk or under the influence of drugs.
First, I think your mythology needs to be reversed. Once you are very aware of the uninsured assets, debts, earnings etc. , then you make the decision whether you want to pursue the claim against that individual. Until you know these facts you can’t make an intelligent decision. It’s as if you stumbled on to a small pond and you invested in a rod and reel and bait, throw a hook in the water but first you determine there are actually fish in the water.
This definitely depends on how much we are talking about. Is the difference 10-15K? Sure it might be worth it to go to small claims court and get part of the money back. The second question is also whether the at fault party has the ability to pay (good paying job or assets) or will you just force this person into bankruptcy.
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