Your questions is kind of complicated and is difficult to answer without all of the information. You should talk to your appointed attorney about this. Remember, although he is paid by the insurance company (and may have some loyalty there), his duties are to you.
The short answer is: you will most likely be fine. Your insurance company will most likely cover you in excess of $100k if you lose in excess of $100k. (Again, talk to your attorney about this)
This is why: If a loss is covered by the insurance company (and it sounds like it is in your case), then the insurance company has a duty to YOU to settle within policy limits if it has a reasonable opportunity to do so. If it fails in this duty, then it is liable to you for your damages under the legal theory of insurance bad faith. For more information on bad faith, see http://www.trucounsel.com/index.php/breach-of-implied-covenant-of-good-faith-and-fair-dealing-insurance .
For example, if the case is worth $200k and the insurance company could have settled the case for $100k and didn't, then the plaintiff will likely sue. If the plaintiff gets a $200k judgment, then the insurance company will pay $100k under the insurance contract and you will be harmed by the remaining $100k. You will then have a claim against the insurance company for $100k and possibly punitive damages.
Because the insurance companies know this, they usually will simply cover the entire judgment or settlement if there is a good argument for bad faith. Again, you will probably be fine. If you aren't, call me or another attorney to discuss a bad faith claim against your insurance company.
I agree with Mr. Richards to take your appointed attorney's advice. He or she has a duty to protect your interests. When a person, such as you, causes an accident, he is the named party in the lawsuit. Your insurer has a duty to pay up to the policy limits. They may also have a duty to pay any Judgment in excess of your policy under a theory called bad faith. That theory requires the insurer to put your concerns ahead of their own and, if they fail to do so in "bad faith", you, essentially have a suit against them for failing to perform their duties appropriately.
Typically, if the Judgment against the insured is in excess of the policy limits, and the insurer has acted in bad faith, one of two things happens (if there is no appealable issue): the insurer pays the total Judgment; or the insured assigns his rights in his bad faith claim against the insurance company to the injured party.
Talk to your assigned attorney about this. He may demand that the insurer retain another counsel to guard your interests.
Hope this helps.
/s Donald Kudler
This answer does not create an attorney client relationship and does not constitute legal advice, but is solely the opinion of a Nevada Attorney.
The duties of an insurance carrier to its insured arise from the insurance contract. Generally, the insurance carrier owes the insured 2 duties: to defend and to indemnify. The duty to defend simply means that the insurance carrier must retain and compensate counsel to represent, defend, and protect the interests of the insured in litigation. The duty to indemnify means that the insurance carrier must pay an amount up to the limits of its insurance coverage (i.e., policy limits) in the event of an adverse judgment or settlement. A key peril that a liability insurer then faces is that once it declines the claimant's "reasonable" offer, neither its belated payment of policy limits nor its belated acceptance of the claimant's settlement offer will discharge its bad faith liability. Thus, in Archdale, the carrier, which had declined the claimant's policy-limits demand, defended against the insured's bad faith action on the ground that it had compliedÂ with its express policy obligations by providing a defense to the insured and by eventuallyÂ paying policy limits. The court rejected that contention, holding that because the source of a liability insurer's duty to settle arises from an implied covenant of good faith and fair dealing, the insured could still maintain a bad faith action against the insurer. (154 Cal. App. 4th at 465.)
The carrier's subsequent acceptance of the claimant's demand does not undermine the insured's claim. As the court noted in Critz v. Farmers Insurance Group: "Rejection of an initial settlement offer is frequently regarded as a preliminary bargaining tactic, not as a breakoff of negotiations. ... Even if the insurer attempts to resume negotiations by a belated offer of the policy limit, that action does not necessarily relieve it of the onus of an earlier bad faith rejection." (230 Cal. App. 2d at 79798 (1964).An insurance company’s duty to act reasonably in considering settlement demands is based on the duties owed to the insured, not the claimant. The insurance company’s request for a full release in Fortner was intended to protect its policyholder from excess liability. Nonetheless, based on Fortner, an insurance company may still be found to have breached its duty to settle since the claimant may have been left without full recourse. This shift continues to broaden the insurance company’s duty to settle from considering the interests of the insured to including the interests of the claimant as well.
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It depends on the facts of the case. If there is an excess judgment, one has to find if your insurance had the opportunity to settle for the policy limit (most do) and failed to do such. If they failed to do such, then you have a good case against your insurance company and thus most of them will pay the excess to avoid a bad faith claim. However, I would make sure you have something in writing. Thus, a simple letter advising your insurance that you would prefer to avoid an excess amount and would prefer they settle for your policy limit may assist in protecting your interest.
The answer above is only based upon the limited information provided. The answer is limited and my review is likewise limited, and thus the response is not intended to be acted upon as legal advice. Although licensed in numerous states, I am currently only licensed to practice law in the state of Nevada. No attorney-client relationship is formed until you sign an attorney-client agreement with my office. Any information provided is for discussion purposes only and there is no attorney-client relationship formed. Only general legal information is provided. Each case is unique and accurate legal advise would require review of all details and documents for each specific case. It is possible that the comments here, while meant to be helpful, may in some cases not be complete or accurate.
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