When I first started practicing personal injury law, I was amazed at how difficult it was to deal with insurance. This is especially true with car accidents—which represent a majority of our cases. First off, there are numerous types of insurance: liability, underinsured motorist, personal injury protection. The first piece of the puzzle is the insurance policy for the person liable for the accident.
Most of the car accidents we deal with have no real issues of liability. This means that everybody is in agreement as to who caused the crash. Typically, if an accident is severe enough that somebody is injured, the police will be called. Almost always, the police will make a determination of fault; I have yet to hear of police arrive at an accident and not issue somebody a ticket.
For the most part, insurance companies will not dispute an officer’s finding of fault. This means that in engaging in settlement talks with insurance companies, the negotiations focus almost entirely on the issue of damages, and not liability. The type of insurance that is being utilized here is liability insurance. Liability insurance provides coverage in the event that you are responsible for an accident. The insurer steps into your shoes and indemnifies you. In Washington State
For the most part, the policy limit represents the maximum amount of money you can receive from the at-fault party, regardless of your actual damages. For instance, my client in a previous case, “Dave,” was in a horrific head-on collision resulting from the other driver falling asleep and crossing the center line on a two-lane highway. Dave suffered massive lacerations across his face from the shattered glass of the windshield; he broke 7 ribs and his spleen ruptured as his body was thrown into the steering will; his thumb was shattered against the dashboard; and his thigh was filleted open, requiring extensive skin grafts. Dave’s hospital bills were enormous, as were his claims for lost wages and pain and suffering. Liability was clear: the other driver was undisputedly at fault.
Unfortunately for Bill, the other driver was only carrying the minimum of liability insurance required by law. The insurance company offered up the full $25,000 in a blink of an eye, but that was all they could offer. The at-fault driver had no assets in his name—well, he had the truck that he had been driving, but the collision had turned it into a giant paperweight.
As you can see, liability insurance is often not sufficient to make an injured party whole. It’s also a reason to consider getting more than just the minimum coverage, especially if you have assets to protect.
