Although Texas law requires all drivers to carry at least $30,000 in general liability insurance, an injured person’s losses often exceed this relatively small limit.
Specifically, an auto accident victim’s damages, including the costs associated with their current and future medical care, the wages they’ve lost while recovering from their injuries, and the myriad of the damages associated with a car accident can easily exceed this limit. This article will explain how an insurance policy’s limits affect an accident victim’s ability to recover compensation for their damages, and will also discuss strategies that our firm has successfully utilized to work around these obstacles.
How Texas’ minimum insurance policy limits work.
A small number of drivers have significant insurance policies. Typically wealthier individuals with more assets to protect, they could have insurance policies ranging from $150,000 to even $1 million. This, however, is the exception because most people only carry “minimum limits” policies. Texas’s laws require all drivers to carry general liability insurance policies that provide at least $30,000 in liability coverage for each person (up to a total of $60,000 per accident) they hurt in an accident. While these figures may initially seem adequate, as discussed above, they are often not. These lower policies, or the lack of a policy altogether, put the injured party in a difficult situation in which they may need to go to their own policy under the pretense of an under-insured or even un-insured motorist(UIM) claim. As well, you may even have to file a personal injury protection claim if the UIM claim doesn’t cover the extent of your injuries.
For example, if your car accident case resulted in medical expenses of $45,000, but the responsible driver’s insurance policy only covers $30,000, you’ll theoretically be prevented from fully recovering from your injuries. And that’s assuming the insurance company pays you out the full value of the policy. So, for serious accidents—which can cause up to hundreds of thousands of dollars in damages—your attorney will need to look elsewhere for additional parties who could be held legally responsible.
Potential sources of additional money.
In the event that the other driver’s insurance policy is unable to cover the full extent of your injuries, your attorney should seek to lay hold of the other party’s personal assets, file suit against other responsible parties, and/or pursue additional insurance policies.
- Personal Assets: If the driver wasn’t insured or had minimum limits of insurance, our attorneys may be able to recover for your injuries by seeking to recover damages from their personal assets. However, the availability and extent an attorney is able to recover liability against another driver’s personal assets on your behalf is limited only be the Texas Homestead Act. Under this law, claimants such as yourself cannot pursue the driver’s home, retirement money, car, or many items of personal property like jewelry or art.
- Other Defendants: Many of our car and truck accident victim clients are somewhat surprised to learn that other parties besides the other driver may be partially or entirely liable for their injuries. For example, our firm successfully represented a client whose case was initially against the responsible driver crossed who into our client’s lane and caused a head-on collision. However, after a thorough investigation, our firm discovered that the accident was partially attributable to a defective tire that unexpectedly delaminated. As a consequence, our firm was able to also pursue compensation from the tire manufacturer and ultimately recovered substantially more for our client than if they were stuck with relying on the other driver’s insurance policy.
- Underinsured Motorist Policy: As their name suggests, these policies kick in when the driver who hit you doesn’t have the insurance available to cover your losses. This is insurance you need to have purchased for yourself. A lot of our clients are unaware that they even have an underinsured motorist policy. In fact, insurance policies generally have underinsured motorist coverage unless the policyholder has specifically rejected it. In essence, we can pursue your own insurance policy on your behalf when the other driver’s policy is exhausted.
- Reductions: For the majority of car accident victims, a major component of the losses they experience in car accidents stem from the unexpected medical bills and the wages they lost while they couldn’t work. After a party recovers for their injuries, they’re required not only to pay back medical providers for the services they’ve been provided, but may also have to pay back benefits from Texas’s workers compensation program if they were injured on the job. In the event that the responsible driver had a small insurance policy, our attorneys may be able to negotiate and reduce your repayment obligations to medical and other benefit providers. By negotiating on your behalf, we work hard to ensure that more of the money we win on your behalf actually goes into your pocket.
- Other Insurance Policies: Our firm has realized that even where there is only a small limit auto insurance policy on the vehicle itself, the responsible driver’s actions may also be covered by an additional umbrella policy. These umbrella polices are often worth significantly more than the auto policy itself, and may only be discovered with the tools and resources possessed by an experienced auto accident firm like Grossman Law Offices.
- Bad Faith Claims Against an Insurance Provider: It’s important to note that insurance providers are required to conduct their business in a certain way under Texas law. When our firm makes a specific type of demand against an insurance company, but they refuse to fulfill the demand in violation of their duties under Texas law, we may be able to assert liability for your injuries against the insurance company itself in addition to the negligent party responsible for causing them. Although this procedure was developed in the early 1900s, it’s an ace in the hole that our firm has successfully used several times to obtain more compensation for our clients.
Why you should call Grossman Law Offices.
If you’ve been injured in a car accident and the other driver has only purchased a general liability insurance policy, it may appear at first glance that recovery for your injuries will be extremely limited. However, our firm’s twenty five years of experience has proven that we might be able to find additional sources of funds for you to collect against, thereby increasing the value of your claim.
If you’ve been injured in a car accident, our experienced auto accident attorneys may be able to help. For a free consultation regarding how the other driver’s insurance policy limits may affect recovery in your case and how our firm may be able to get around those limits, give us a call at (855) 326-0000.
You are concerned that the person at fault may not have enough insurance to cover your medical bills, so that you’ll be left having to pay the bills out of your own pocket.
CAN YOU FIND OUT THE DEFENDANT’S POLICY LIMIT?
Yes. And how you do that depends on whether you’ve filed a lawsuit yet.
After You File a Lawsuit
After you file a lawsuit against the at-fault party, your personal injury attorney will serve the defendant with a document called “Form Interrogatories.” These are questions which the defendant must answer in writing under oath. One of the questions, Form Interrogatory 4.1, asks whether at the time of the accident, the defendant had any insurance which covers, or might cover, your injury claim. In answering the interrogatory, the defendant must disclose all insurance policies which might apply to your injury claim, including umbrella policies, and each policy’s limit.
Before You File a Lawsuit
Before you file a lawsuit, the defendant has no duty to disclose to you or your personal injury attorney the amount of his policy limit. Only if the defendant authorizes it can his insurance adjuster disclose the amount of the policy limit. Sometimes the defendant authorizes disclosure, sometimes the defendant doesn’t.
If the medical bills you have submitted to the insurance company are low and the defendant’s policy limit is high, there’s a good chance the defendant won’t authorize disclosure, fearing that if you find out there’s plenty of insurance, you’ll just build up more medical bills for unnecessary treatment.
However, if you have submitted a substantial amount of medical bills to the insurance company, and the defendant has a low policy limit, and your claim is clearly worth more than the policy limit, than the insurance company will likely disclose the policy limit.
If the defendant refuses to authorize disclosure of the policy limit, or if you want this information right away, without waiting around for the insurance adjuster to respond to your request, your attorney can hire an insurance tracing company that will verify the policy limit. Insurance tracing companies only work with attorneys; they will not work with unrepresented injury victims.
Aggressively seek to find out the defendant’s policy limit. Gather up all of your medical records and bills, and documentation of any lost wages, and submit the documentation to the defendant’s insurance company, with a letter demanding immediate disclosure of the policy limit. That will trigger the insurance company sending a letter to the defendant asking if he wants to disclose the policy limit. This will get the ball rolling. If more medical bills and reports are generated, keep funneling them to the adjuster. The more documentation of your injury and your bills that you provide to the adjuster, the more likely the policy limit will be disclosed.
If you already have a personal injury attorney representing you, ask your attorney if he has requested disclosure of the defendant’s policy limit, or if he has hired an insurance tracing company to obtain this information. If the answer is no, there is reason to be concerned. It may be time to think about getting a second opinion from another lawyer. At our firm, in our first letter to the defendant’s insurance adjuster, we always demand disclosure of the policy limit. We believe this should be standard practice by every personal injury lawyer, but surprisingly, it’s not.
Too many times, I’ve taken over personal injury cases from prior attorneys who made no attempt to find out the defendant’s policy limit. Often times, the attorney referred the client for expensive medical tests and treatment, (MRIs, epidural steroid injections, etc.) without regard to the policy limit. Many attorneys operate on the theory that the more medical bills they can ring up, the faster they can turn the case over, and the more money they can get for it. But it’s the client who will suffer, not the attorney, if there’s not enough insurance to pay the medical bills. The client is the one on the hook for these bills. And know this: even if your medical treatment was rendered on a lien basis (i.e., the doctor agrees to wait to be paid until your case settles), you are still on the hook for those bills, regardless of the outcome of your case. If it turns out there’s not enough insurance to pay all of your medical bills, you are still legally obligated to pay them. The attorney will get his money off the top of the settlement, but you will only end up with money in your pocket if there is money left after paying off the medical bills.
You don’t want to end up with more medical bills than there is insurance to cover them. You need a personal injury lawyer who will aggressively seek to find out the defendant’s policy limit.
For a free consultation or on your personal injury case, speak with an accident attorney
We know that accidents don’t always happen during business hours, and when you need to speak to an attorney, you want to speak with one NOW. An attorney at our firm is available 24/7 for a free consultation.