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Should I accept the policy limit of the at-fault driver, even if it only covers a fraction of my damages?

Irvine, CA |

Fourteen months ago, I was involved in a motorcycle crash where the at-fault driver failed to stop at a red arrow lef-turn-light. The medical bills alone amount to about $100,000, but the liable driver's insurance policy maxes out at $15,000 for bodily injury. I did not carry uninsured/underinsured motorist coverage.
My attorney says a background check on her did not reveal any assets they could go after in a personal injury lawsuit. In a personal questionnaire that my attorney had her fill out via the insurance company, she also stated that she does not have any assets and is basically broke and about to file bankruptcy.
Are there any other options for me to make sure if she has any assets to go after? Or should I accept the meager settlement offer and forfeit the right to sue?

Attorney Answers 16


  1. Best answer

    Unfortunately, in my experience this type of scenario happens all too often, where the at-fault driver is not only underinsured but also has limited or no assets. If your attorney has done a thorough background check that reveals no assets, that's probably a pretty good indicator that you will have a difficult time collecting, even with a judgment against them, more than the policy limits from the at-fault driver. You can however ask to see (although they have no obligation to show you) their financial records such as bank statements, pay stubs and tax returns to give you a better idea of their financial situation. Sometimes an at-fault driver may agree to settle by paying a bit more out of pocket, in addition to the policy limits, either in a small one time lump sum or on a payment plan, but often this type of settlement will not be reached unless a lawsuit is filed and then any additional amount you obtain over the policy limits may be wiped out by your litigation expenses. Depending on the age and employment status of the at-fault driver you may want to consider waiting to accept the policy limits, if you are so inclined, before the statute of limitations expires as there is always the possibility (however remote) that a formerly financially destitute individual could dramatically change their financial situation (by receiving an inheritance, winning the lottery, etc.). Ultimately, you should ask yourself whether it is worth investing more of your own time, money and effort to try to obtain more than the policy limits, given what you and your attorney are able to find out about the at-fault driver's age, education, marital status, employment, criminal background, assets and financial situation.


  2. Speak to your lawyer further about this. It sounds like he/she is investigating this properly. Unfortunately, the state minimum for bodily injury liability coverage in California is this meager $15,000. I wish this limit would be increased. You, like many other Californians, find yourself unable to even cover a fraction of your medical expenses not to mention pain and suffering at this low limit. It is a shame!

    Nothing in this communication should be construed as creating an attorney client relationship. This is for informational purposes only. Attorney will take no action on your behalf unless and until a written retainer agreement is signed. There are strict time deadlines on filing claims and, as such, you are advised to consult with and retain an attorney immediately to file such claims timely or you will lose any right to recovery. Any testimonials or endorsements should not be construed as a guarantee, warranty or prediction of the outcome of your case.


  3. This is one of those unfortunate circumstances where you can sue, get a judgment for a larger amount than the policy limits but be limited in what you can collect because you do not have underinsured motorist coverage. If she files a bankruptcy, that's a big problem except in very rare instances. I guess all you can do here is follow your attorney's advice.. Best to you and sorry it's working out this way for you.

    Attorneys on Avvo donate their time and your feedback is appreciated. Be sure to mark the "Best Answer" or Helpful" to your questions.


  4. If a thorough asset check has been done and it confirms that the driver has no other assets, then unfortunately there is nothing more to do. Talk to your lawyer to find out what background check has been done on the driver and if there are other potential defendants that have not been considered. Good luck.

    This information is not intended as legal advice or to create an attorney-client relationship between you and any attorney. Such information is intended for general informational purposes only.


  5. You have an attorney already. You should discuss these concerns and questions with your attorney.


  6. Yes you should or you will receive a bankruptcy discharge and get nothing.

    The information provided herein is for informational purposes and should not be construed to establish an attorney client relationship. To establish such a relationship, the prospective client would need to meet with me in person, and have a detailed discussion about all the facts and circumstances surrounding your case.


  7. Sounds like you might just be up against it on this one. Did you have any UM coverage?


  8. You certainly have the right to sue and you will likely secure a more substantial verdict and judgment than the "meager" $15k policy limit. Then what do you do with the judgment. If she has no assets you will not be able to collect it. You can wait until she wins the lottery and hope that in the meantime she does not declare bankruptcy listing your judgment as one of her debts. This is a tragedy of coverage.
    This is why that underinsured and uninsured coverage would have come to your aid. Such coverage is very, very cheap. It's the best value around. Obviously it is too late to purchase that coverage for this case, but call your agent and check the costs. A friend of mine always tells clients that when you see those commercials on TV for Safe Auto or some other company providing minimum coverage be very afraid. There are many drivers out there with that or no coverage and the only way to protect yourself is to purchase UM/UIM coverage.

    If you feel this is the "best" answer or is "helpful," please indicate. Since I am limited to the information you provide, I cannot guarantee the accuracy of the answer. You should seek the advise of an attorney who can explore all aspects of your question. This communication does not form an attorney client relationship.


  9. You have few options. Even if you sue the other driver and get a big judgment, she will file for bankruptcy and you will get nothing more than her insurance policy limits. Discuss this with your attorney.


  10. Were you living with any relatives at the time? Did they have vehicle insurance? What um limits did they have?


  11. I don't practice bankruptcy law but I understand that should the driver be convicted of a crime or be proven in a civil case to have acted with malice then the Bankruptcy Court will not discharge a damages award in your favor arising out of that misconduct. But, you may never find resources to pay your judgment.

    What needs to be done is some civil disobedience in the toilet bowl we call the State Legislature. The liability limit of $15,000 (which used to buy a beachfront cottage) is so despicably out of date that the Legislature, in my firm view, acts WITH DELIBERATE INDIFFERENCE to collision victims in keeping it so low. My suspicion is that they are owned by the insurance industry and, if so, the industry deserves a financial death penalty. Find your reps, find out where they live, and let their neighbors know that we are all victimized by shoddy insurance laws. AND, get higher liability and underinsured limits yourself to protect against this scenario.


  12. Has your attorney ruled out the issue of whether the other driver was on an errand for her employer? Has your attorney ruled out the issue of whether the owner of the vehicle negligently loaned her the vehicle? If so, then yes, you are stuck with the $15,000 per person limit. I lecture motorcyclists repeatedly about the need for high uninsured/underinsured limits on your own policy. It is needed, and worth it.


  13. I agree with others that is suggested that you direct your question to your current attorney. However, generally speaking, I would be very sure that there is no ability to collect against the responsible party, personally. Even if the responsible party is not employed now, a judgment is valid for ten years, and thereafter can be renewed for another ten years, etc. If the at fault party is ever employed or acquires real estate or a vehicle, for example, you can use your judgment to garnish his or her wages or to force the at fault party to sell assets to pay the judgment.

    You should also be careful, if you decide to accept the settlement, that any recovery that would otherwise go to you will not first go to pay off any medical liens. You may be left empty-handed with only a portion of your medical bills being paid and you still owe the balance.


  14. It sounds like your attorney has properly conducted the background check. Has the possibility that the driver was employed and driving within the scope of employment at the time of the accident been ruled out? Also, has your attorney discussed additional contribution from the defendant? Sometimes a defendant will be agreeable on additional contribution on a monthly basis. However, this is usually a very rare agreement. You can consider suing to collect a larger settlement; however, even if you do this, you will have a difficult time collecting the judgment from the driver due to their financial situation that was discovered through the background check (I don't recommend this route). You should discuss all questions and concerns with your attorney. I'm sure your attorney has done everything he or she can, but if you still want more feedback, you can always contact other attorneys for a free second opinion. Some attorneys are a bit more creative than others. Good luck!


  15. In all civil cases, plaintiffs will ordinarily want to know whether defendants have the financial means to satisfy a judgment—primary coverage, as well as possible “excess” and/or umbrella coverage. However, discovery of insurance information also impacts these particularly important aspects of personal injury litigation. Before meaningful settlement discussions can get under way, the claim must be assigned a reasonable settlement value. For this purpose, claimant will need to know whether the tortfeasors have applicable insurance coverage and, if so, what the policy limits are, whether there are excess and/or umbrella coverages, and whether the insureds and/or carriers claim the policy does not apply.

    The answer above should not be relied upon as legal advice. The information provided above is based on insufficient facts and only speaks to a general opinion based on those insufficient facts. No warranty is provided that the answer is correct. No attorney-client relationship has been formed with me until a signed written contract is complete. For an official opinion, it is advised you seek legal counsel.

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