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Will an insurance company sue me after my insurance company pays out its policy limit if they have to pay UIM coverage?

Columbus, GA |

I was at fault in an accident about a year ago in which I was at fault. One woman had a broken pelvis which resulted in her having 56000 dollars in medical bills after she completed treatment. I have decent insurance coverage for BI of 100000 / 300000. This woman is also claiming a wage loss of 2000 this raises it to 58000. I know that she can also claim other damages such as pain and suffering but if she decides to do that and demands that my insurance company pays the policy limit of 100000 and then goes after her insurance company to pay the difference can they eventually come back after me personally for the difference? I am in the military with no assets and a lot of college debt. I understand I can have my wage garnished. Do insurance companies often do this?

Attorney Answers 5

Posted

You need to demand that your insurance company immediately pay the policy limits to the lady. The insurance company is gambling with your life. No, they cannot sue you because you bought insurance. If there's a wreck that's your fault, then the agreement is that they pay.

Or are you asking if the OTHER insurance company will sue you? That's possible, but very unlikely. You could file for bankruptcy and discharge this debt, which means that they waisted a lot of money for nothing.

Next time, get more insurance. Insurance adjusters have a 'Medicals Times Three' rule of thumb in accessing total damages. That means they this lady's case is about $170,000. But if there's a permanent injury to her, it could be more. Plus, she might need another surgery in a few years, and then the rule of thumb would be to triple the cost of that future surgery.

I think you need to have a lawyer not paid by the insurance company to review the situation and write a letter demanding payment of the policy limits. When policy limits are paid, there's a long release that requires the lady to agree to not sue you. That's your best course: get your insurance to pay up!

You should cooperate with these insurance companies and follow their advice, because failure to do so might get you sued or might void the policy.

Did this help? Thank you for serving in the military.

If any answer on AVVO helps you, mine or someone else’s, please mark it as "helpful" or "best answer" to help AVVO know which answers to show others. Thank you. This response may provide information relating to potential legal issues. Nevertheless, your review of any information contained herein is not a substitute for legal advice from qualified legal counsel. For this reason, you should not rely on this response as a source of legal advice. Your use of this information does not create any attorney-client agreement. In order to become a client of David C. Lee, you must negotiate a specific attorney–client agreement with an attorney from this law office.

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Posted

Yes, your comment helps a lot I appreciate you taking your time to write a response. I have spoken to the Adjustor who is handling the claim for me and they have assured me that they are waiting for the final demand from this woman but that they will attempt to settle at my policy limits if the demand exceeds my policy. I am confident that USAA will settle the claim but I am worried that the woman will file a UIM claim with her insurance company and then her insurance company will sue me to cover the difference. I didnt know if the general release after the settlement excluded me from her insurance company suing me to recover their UIM payout. I just did not know the likelihood of them suing someone like me who has pretty much no assets except for my pay from the military which is actually 30 % exempt from garnishes anyway due to the nature of the allowances we receive as part of our pay. I am really just worried because I am a recent college graduate, I just started a family and I can't afford to be stuck paying this woman the rest of my life.

David Craig Lee

David Craig Lee

Posted

Don't worry/be happy. You survived a very serious crash. You had insurance. She had excess insurance. She survived. Consider a lesson learned: buy more insurance, drive more carefully. Again, thanks for serving and have a great day.

Asker

Posted

Thank you for your help!

Posted

There is no set rule regarding what a cause is worth. It is very likely that this case is worth more than your policy limits of $100,000.00. In Georgia, if your insurance company pays the policy limits many times in these circumstances it is done with a limiited liability release which allows the person injured to still sue you but only to get the underinsured motorists coverage. If the injured party accepts this type of release, then you are off the hook as to the injured party. However, the injured parties underinsured motorists carrier may try to subrogate against you and recover its money. If you believe that the case is worth more than $100,000.00, then you need to hire an attorney to protect your interest if a suit is filed.

The above is just my opinion based upon the limited facts provided. It is not intended to be offered as legal advice nor is it intended to establish an attorney client relationship. You should seek a consultation either in person or over the phone to discuss any legal issue that you may have raised.

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Posted

I doubt it for the following reasons. In order to sue you under her UIM, she would not only have to get your full policy limits but also she has to have a UIM policy which is greater than $100,000. Say 150-500k. Or any subtantial amount over 100k, that would make it worth it for her or herinsurance to sue you. So, let your insurance get a bullet proog release and unless she has a higher limit for UIM, I would not woory about it. However as suggested make sure your insurance company pays the limits to her, otherwise taht would open another can of worms. Best of luck.

This answer is provided by Manuel A. Juarez, Esq., El Abogado de Accidentes de Autos de California: 510-206-4492. El Abogado de Accidentes de Autos provides answers of a general context. These answers are not intended to form an attorney client relationship. El abogado de Accidentes de Autos y Lesiones Personales is licensed only in California. This information is good only in California and it is not to be taken as legal advice on car accidents, personal injury, divorce, bankruptcy or in any other type of situation. Esta respuesta es del Abogado de Accidentes de Autos y Lesiones Personales de Acidentes de carros, Manuel A. Juárez, 510-206-4492. Abogado Hispano de Accidentes, Divorcios, Abogado Latino de Accidentes, y Abogado de Acidentes de Oakland, Hayward, San Francisco, y California. Estas respuesta son solo para información general y no consisten en consejo legal sobre divorcios, mantención de esposas, mantención de hijos o bancarrotas. Las respuestas son comentarios legales que no forman una relación de abogado y cliente. Manuel Juarez, Esq., esta licenciado solo en el Estado de California.

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Manuel Alzamora Juarez

Manuel Alzamora Juarez

Posted

Ooops, I was not waearing my glasses, Hope you can get my meaning of some typos!!!!

Posted

Assuming your insurer pays the limits as it should and the other driver makes a recovery against her own UM coverage, then yes that company can and very well may seek reimbursement from you. This is known as subrogation. In the past, most UM insurers would pay the claim and close the file. However, in these economic times many have have hired third party subrogation companies or simply developed a subrogation department to recover anything they can. I have had defense attorneys tell me they have even taken $20 a month just to try and recover something. A lot of this will have to do with who the insurer is.

As others have suggested, writing a letter to your insurer demanding they pay the claim and protect you is probably your best course of action short of hiring a separate attorney to review the matter for you.

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Posted

In the cases where the subrogation departments have sought financial reimbursement for cases such as these do you know if they typically give the tortfeasor an option of paying monthly payments as you said? I would assume that they would attempt to collect the money without going to court in the most diplomatic way possible. If this were to come to play in my situation for instance do you know if I would be able to negotiate a monthly payment plan that does not involve them automatically garnishing my wages?

Matthew Chase Swanson

Matthew Chase Swanson

Posted

There are a lot of moving parts to those questions. On the one hand, you don't want a wage garnishment or bad debt hanging over your head. On the other hand, the insurance company wants to recoup as much as they can, but with as little expense as possible. Keep in mind, insurance companies also have some bit of an image problem when it comes to these claims. To answer your question, I would imagine that for the rare cases where they are able to find someone willing to reimburse them to some extent, they'd be happy to take monthly payments. If you do get to that point, I highly encourage you to seek representation.

Asker

Posted

Hey Matthew I appreciate it thanks for your help!

Posted

The short answer is pobably yes. Assuming that liability is not an issue, her lawyer will demand the policy limits in exchange for a limited release that allows her to collect any UM coverage that she may have. Georgia has two types of UM coverage, if she has opted for "add on" UM coverage, there is no offset for the compensation she has received from your policy and if her insurer pays they can and likely will go after you for the money that was paid. If this happens, your insurance carrier is obligated to defend you in this action and can probably negotiate the amount of reimbursement. Best of luck to you and I applaud you for carrying more than the minimum limits.

Andrew P. Copenhaver
www.bellbrigham.om

The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change.

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Posted

Andrew, thanks for the reply. Here is my next question. If she receives the maximum policy limits from my insurance company and then turns around and then sues her own insurance company for her underinsured motorist protection is there a limit usually that she can receive from this? She can only receive the amount of policy that was originally tied to her insurance correct? Therefore, for example, if she has 25,000 UIM protection and she receives the 100,000 max policy from me but her case is worth say 150,000 can she sue her insurance for more than that 25000 coverage that she had, and then can they subsequently come after me for this amount over? Or, will her insurance company fight her and claim that my maximum policy limits covered her damages adequately enough and not give her the UIM. Again thanks for the reply, I'm really just pretty upset I'm in this situation, I thought I had adequate insurance but apparently I need to start carrying at least 300,000. I'm sitting over here in the Middle East worried that I am going to come home to nothing because I will have to pay a woman well over her medical bills and lost wages to compensate her the rest of her life and live a life of poverty for myself and my family. I'm probably overreacting but I work hard for what I have and to have a car accident take my income and all my assets away is extremely depressing.

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