Defendant has low insurance limits: Should I settle?
As if being injured due to another’s carelessness isn’t enough, finding out the person only had the minimal insurance coverage just adds insult to injury. But this is often the case in California where it is widely reported that a significant number of drivers either do not have liability insurance at all, or have the minimal amount permitted by law. Now you are stuck with awful decision of what to do? You need to settle because the money would really assist you in paying for medical bills, and covering expenses since you have missed days at work. But you don’t want to settle for less than you deserve either.
Three things you must consider before settling your case.
- Are there any others that may be responsible for your injury other than this defendant with the low insurance limits? For example, was the driver the owner of the vehicle? If not, maybe there is some additional insurance. Did the driver use the vehicle for work purposes? If so, you may be able to tap into the employer’s insurance. Did anything else contribute to the accident – maybe the design of the roadway, or another vehicle that made an erratic lane change. You have to analyze all possible alternatives to see if there may be another responsible party. If you hire a good personal injury attorney, this should be an automatic analysis that occurs during your first meeting with them.
- Examine whether the defendant has assets that may be available to pay for your damages. This is often a loser option. The chances of a person having a low insurance policy, but significant assets is very low. That is because when you buy insurance you and your insurance broker should be analyzing your assets in order to provide the appropriate protection. The goal is to protect your assets with insurance. And the reality is that obtaining a judgment against somebody with no assets is not very useful, practically speaking, because they always have the option to file bankruptcy.
- Look to your own insurance. I hate when I get a client that had been badly injured by somebody with minimal insurance, but if my client doesn’t carry more than the minimal uninsured/underinsured insurance coverage, I always tell them they should be mad at themselves too. You should always look out for yourself and your family. Do not depend on others to carry sufficient insurance. You should always carry as much uninsured/underinsured insurance as possible to protect against this exact situation. So you, or your lawyer, should take a look at your insurance policy and examine your coverage. This coverage will allow you to recover additional money for your damages even if the defendant only has a minimal amount.
If you find yourself in this situation where the party that injured you has the minimum insurance, do not immediately give up. I cannot tell you the number of times I have been able to find additional responsible parties for my clients allowing my client to be fully compensated for the damages done to them. It takes hard work and determination, but it can be done. It is often best to allow an experienced lawyer with access to additional resources to handle your case for you, but this is not something you cannot do on your own.