Uninsured motorist coverage and underinsured motorist coverage is designed to serve as a safety net for traffic crash victims and their families when the at-fault driver had no insurance or only the bare minimum insurance. Often referred to as “UM coverage,” it’s additional coverage held by the victim’s own auto insurance company, and it can be a lifeline in cases of a motor vehicle fatality or grievous injury.
In some cases, state law allows UM coverage providers to seek “set-offs” in certain situations. For example, if the injured person also received workers’ compensation benefits, the insurer may be entitled to a “set off” that will reduce the UM payout by whatever was paid out by workers’ comp.
Additionally, if the other driver had insurance, albeit minimal, whatever was paid might be asserted as a “set off,” and so too might the amount of medical payments covered by a health care insurer.
But of course, as our Fort Myers motorcycle accident lawyers are well aware there are a host of provisions benefiting consumers too. For example, the 1st DCA, relying on the common-law collateral source rule, found in the 2010 case of Nationwide Mutual Fire Ins. Co. v. Harrell an insured was entitled to submit to the jury the gross amount of her medical bills, rather than the lesser amount paid by her private health care insurer under an independent settlement agreement. Thus, the insurer was not entitled to a set-off there.
That same year, the 4th DCA ruled in GEICO v. Cirillo-Meijer an insurer was entitled to a set-off for personal injury protection benefits received by plaintiff from at-fault driver’s insurer – but could not obtain a set-off for the settlement plaintiff secured from the driver personally. These cases tend to be extremely complicated, and rely heavily on state law and legal precedent.
The recent case of Elliot v. GEICO, before the California Court of Appeal for the Third Appellate District involved a woman whose husband was killed in a motorcycle accident.
According to court records, the man was killed when his motorcycle was struck by a truck driven by an intoxicated driver, a woman who was returning home from her job at a nearby restaurant and bar. His widow sought underinsured motorist benefits pursuant to the policy issued her husband.
However, the insurance company denied payment to her because she had already received more than the $100,000 in UM limits in a wrongful death lawsuit brought against the drunk driver and the owners of the restaurant. The at-fault driver’s insurance company paid $15,000 and the bar owner’s general liability insurer paid $250,000.
The trial court agreed with this denial, and the decision was affirmed by the appellate court, on the grounds the policy was unambiguous on this issue.
Ambiguity is one of the primary grounds on which an auto insurance company can be made to pay, as any conflicting policy provisions will result in a decision favorable to the insured.
However, courts also recognize insurers have a right to limit their payout policies, so long as they are expressly clear in doing so from the outset, and do not refuse to pay legitimate claims in bad faith.
In truth, few insurers will eagerly pay even clearly legitimate claims for coverage. That’s why it’s imperative for accident victims to seek counsel from an experienced accident lawyer.
If you have been a victim of a traffic accident, call Chalik & Chalik at (954) 476-1000 or 1 (800) 873-9040.
Elliot v. GEICO, Nov. 19, 2014, California Court of Appeal for the Third Appellate District
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Wright v. Carroll – Sudden Emergency Doctrine, Nov. 8, 2014, Fort Myers Motorcycle Accident Lawyer