By: Mark Caruso
It is imperative that you get the written approval and sanction to settle from your own underinsured motorist insurance company before you settle for policy limits with the at-fault driver's insurance company. If you don't do so, your own underinsured motorist insurance will deny any payment of underinsured motorist coverage to you because you breached the insurance contract.
NM uninsured/underinsured motorist claims are complex. You must get a written settlement sanction by your own underinsured motorist insurance company before you settle for policy limits with the at-fault driver's insurance company. Failure to do so will be devestating to your underinsured motorist claim.
Here's the scenario. You have an injury claim resulting from an Albuquerque, NM auto accident. You have thousands of dollars of medical bills, and you have lost earnings and wages from your job. You haven't hired an attorney, and you are trying to settle the claim yourself.
You want to settle for $40,000
Caruso Law Offices, Personal Injury and Wrongful Death Attorneys
Let's say that you have State Farm Insurance on your vehicle, and the at-fault driver has Allstate Insurance on his truck that caused the collision. You hear from the Allstate Insurance adjuster that their driver only carried minimum limits of $25,000. The adjuster sends you a declaration page proving that the driver only carried $25,000. The adjuster offers to settle your claim for policy limits of $25,000 and asks you to sign the release of all claims.
You know that you also have underinsured motorist coverage with your own insurance, State Farm. You have had some discussions with the State Farm adjuster about your claim against Allstate and the possibility of going against State Farm for any amounts over $25,000.
Your insurance contract (or policy) with State Farm requires you to get State Farm's written sanction and approval of the settlement with Allstate Insurance before you sign the Release with Allstate. If you don't do so, State Farm doesn't need to pay you anything. The adjuster from State Farm doesn't need to tell you that there must be a written approval. You are assumed to know what is in your contract (policy) with State Farm.
Here is what you must do to preserve your right to continue your claim against State Farm's underinsured motorist coverage:
The Allstate adjuster must send you a letter with the offer of policy limits in writing and a copy of the Declarations Page of the at-fault driver's policy with Allstate. This letter must state that Allstate is offering to settle for policy limits of $25,000.
Let the Allstate adjuster that you need a few days to get the sanction and approval of the release and settlement from State Farm, your own under-insured motorist carrier. Do not sign the release until you get the sanction and approval from State Farm.
You must then immediately send the letter from the Allstate adjuster together with the Declarations Page of the at-fault driver's policy with Allstate to the State Farm adjuster. You must request that State Farm sanction and approve a settlement between you and Allstate and its at-fault driver.
The State Farm adjuster will then do an assets check on the at-fault driver to determine if the person has assets that State Farm could go after. Once State Farm finishes the assets check, you will receive a written letter from the State Farm adjuster authorizing you to settle with Allstate and its at-fault driver and giving you the right to sign the release for Allstate and its at-fault driver.
Do not accept a verbal authorization from State Farm to settle. The authorization must be in writing, either by email or letter.
You can now settle with Allstate and its at-fault driver. You can sign the release and accept the check for $25,000
You can also now present your claim to State Farm for the underinsured motorist claim. If your claim is valued at $40,000 and you have already received $25,000 from Allstate, you would now want to settle for $15,000 with State Farm Insurance.
I again want to stress the importance of getting the approval to settle from your own car insurance company before you settle with the at-fault driver's insurance company IF you intend to pursue an underinsured motorist claim.
If you have any questions on the process or procedure, please feel free to contact me at 505-883-5000 for a free consultation. My firm, Caruso Law Offices, has two offices in Albuquerque--the North East Heights and the West Side--but we handle cases throughtout New Mexico and its pueblos and reservations.
I have been practicing law for 31 years, and I am a former insurance company attorney who now exclusively represents the victims of collisions and accidents. We believe that we are extremely good at what we do, because we only handle personal injury and wrongful death cases. Whether you have a car accident, a truck accident involving an 18 wheeler, tractor trailer or semi truck, a motorcycle accident, a bicycle accident or a pedestrian accident--We Are Here To Help You!
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I hope to personally hear from you for your Free Consultation with me.
Thanks. Mark Caruso
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