About Car Insurance?
There are hundreds and hundreds of questions about car insurance and
car crashes. The answer to each question may be different based upon
the state where you live or the state where the crash occurred. In
addition, insurance policies are not alike, and the answer will depend
also on what your insurance company wrote in the insurance policy
which was sold to you. In this section of the Hill, Peterson, Carper,
Bee & Deitzler, PLLC website, we explain some basic insurance
Nothing here should be taken as legal advice for your individual case,
because all cases are different. Each claim is based upon the facts
of the case, the insurance policy that applies, and the state law
which governs the application of the insurance policy. If you have
an accident and need, or want, specific answers, please feel free
to call one of our lawyers anytime. The initial consultation is always
free. We may, or may not, be able to assist you, but you are always
welcome to call.
1. What Does My Car Insurance Do?
Most car insurance usually does one of three things. The insurance
may pay you or a family member if you have a claim. It may pay someone
else who has a claim which the insurance covers. Or it may pay for
an attorney to defend you if a claim is made against you.
Payments To You
If your car is stolen or damaged, most insurance policies will pay
you, at least in part, for that loss (see "Damage Coverage"
subtitle below). If you are injured in a car crash, most insurance
policies will pay a portion of your medical bills regardless of
fault (see "Medical Payments Coverage" subtitle below).
If you are injured or your car is damaged due to the fault of another
driver, your insurance policy may provide for payment of part or
all of the loss that the other driver's insurance does not cover
(see "Uninsured and Underinsured Coverage" subtitle below).
Other family members who are injured in a car wreck may also be
entitled to the same benefits, even if you are not one of the drivers
who is involved (see "Who Is Covered" subtitle below).
Payments To Others
In the event that you are at fault in causing injury to others or
damage to property through the use of a motor vehicle, your car
insurance will pay (up to a certain limit) the amount of money that
you owe to the other person (see "Liability Coverage"
subtitle below). In effect, through the use of insurance, you are
paying the other person what you owe (your personal responsibility)
and your insurance company is reimbursing you for what you had to
pay. Legally, this concept is known as "indemnification."
Key to the concept of indemnification is the fact that the injured
party has a claim against you, not your insurance company. If you
do not owe, your insurance company does not owe either. But if you
do owe the injured party, your insurance company "indemnifies"
you by paying what you owe (up to the amount of your policy limit).
In some states, including West Virginia, if your insurance company
has the opportunity to resolve all claims against you within the
amount of your insurance coverage, but refuses to do so, it will
be responsible to pay the entire amount of any jury verdict against
you (with no upper limit). That is because the insurance company
has a legal duty to fully protect you if it can do so by payment
of a fair and reasonable amount that is within the policy limit
that you purchased.
In addition to helping pay for injuries and losses, most insurance
policies require the insurance company to hire a lawyer who will
defend you if a claim is made against you. That policy provision
is referred to as the insurance company's "duty to defend."
Ordinarily, that responsibility of the insurance company (to provide
a lawyer who will defend you) stays in place, even after the insurance
company has paid the maximum amount of money that it is required
to pay under your insurance policy provisions (see "Policy
Limits" subtitle below).
Do I Have Full Coverage?
There is no such thing as "full coverage" in an insurance
contract. Every insurance policy is subject to limitations and restrictions
which are listed in your insurance policy. The extent of those limitations
and restrictions usually depends upon the amount of money that you
are willing to pay and the type of coverage the insurance company
is willing to offer.
Regardless of what your agent tells you, when an accident occurs,
what the insurance company will or will not do is always determined
by the terms of your insurance policy and the law of the state where
the accident occurred or in which the policy was sold.
To get a general idea of what coverage you have, look at your most
recent insurance bill. Ordinarily the insurance coverages are listed
on that invoice. Lawyers and insurance agents refer to the listing
of coverages on your bill as the "declarations sheet."
Liability coverage is the portion of your insurance policy that
requires the insurance company to pay what you owe to somebody else
as the result of a motor vehicle collision in which you were at
fault to some degree. This coverage includes payment for injuries
to other people, regardless of whether they were in the other person's
vehicle or in your own vehicle. It also includes payment for property
of others that you damage. It is important to realize that the total
amount that the insurance company will pay does not exceed the amount
of coverage that you purchased, commonly known as the "limit
of liability" or "policy limit" (see "Policy
Limits and Deductibles" subtitle below).
Medical Payments Coverage
Although optional, most insurance policies have a provision that
pays medical bills when you, your family members, or your passengers
are injured in a motor vehicle accident. Even if you have health
insurance, this can be a very helpful coverage to purchase. After
a crash, if your medical bills are first submitted to your health
insurance carrier (such as Blue Cross, for example), there is almost
always an amount for which you are still responsible. The remaining
amount due may be a co-payment or a deductible. If you have medical
payments coverage on your car insurance policy, you can use car
insurance to make up the difference. Like liability coverage described
above, the amount that the insurance company will pay depends upon
the policy limit that you purchase.
Uninsured And Underinsured Coverage
In our law practice at Hill, Peterson, Carper, Bee & Deitzler,
PLLC, we find that many of the people who may seriously injure you
in a car crash either do not have insurance, or have insufficient
insurance coverage to pay your medical bills or to fairly compensate
the people whom they hurt. Because of that problem, insurance companies
offer uninsured motorist coverage and underinsured motorist coverage.
If a person with no car insurance injures you or damages your automobile,
your own insurance policy's uninsured motorist coverage will pay
you for your loss up to the amount of coverage that you purchased.
If the person who injures you or a family member simply has insufficient
insurance, the underinsured motorist coverage that you purchased
for your policy will provide compensation for you, your family members,
or passengers in your car.
Unlike liability coverage, which is intended to pay somebody else
who is injured by you (often someone whom you have never met), uninsured/underinsured
motorist coverage provides compensation to you, a family member,
or a passenger. For that reason, it makes sense to purchase at least
as much uninsured/underinsured motorist coverage as you have liability
coverage. It is the uninsured/underinsured motorist coverage that
protects you and the people who are dear to you. Also, most people
do not realize that uninsured/underinsured motorist coverage under
most policies, covers you and your resident family members regardless
of whether you are in your car, in someone else's car, or not in
a car (a pedestrian) when struck by a vehicle. In that regard, uninsured
or underinsured motorist coverage "follows you" wherever
Most insurance policies will provide separate coverage to pay for
damage to your car, regardless of fault. This is necessary because
most of us cannot afford the loss of our vehicle under any circumstance.
Whether the accident is your fault or the fault of someone else,
you need to have your car, truck, SUV, or van fixed or replaced
so that you can move on with life. Like all coverages described
above, the amount which the insurance company is obligated to pay
may be subject to limits based upon the amount of coverage that
you decide to purchase. Alternatively, some policies provide for
payment of all amounts up to the actual cash value of the vehicle,
depending upon the degree to which the vehicle is damaged or repairable.
Policy Limits And Deductibles
The policy limit is the amount of coverage that you purchased in
each of the four general categories listed immediately above. It
is the maximum that will be paid by the insurance company, even
if the loss exceeds the policy limit amount. In West Virginia, the
minimum liability coverage policy limit that can be purchased is
$20,000. More typical coverages are $50,000, $100,000, or more.
Because of the fact that you will owe for whatever damage you cause,
you should purchase liability insurance that takes in to account
your personal exposure to pay for injury or property losses which
may exceed the total amount of the insurance coverage.
In a related consideration, whatever amount you are unwilling to
risk losing to someone else is also the amount that you would not
want to lose as a result of the actions of someone else that injure
you or damage your property. Therefore, your uninsured and underinsured
motorist coverage should have no less policy limit than your liability
coverage. If you are willing to purchase liability coverage to compensate
a likely stranger, you reasonably will want to buy an equal amount
of coverage for yourself, your family, or your friends who ride
in your car.
The policy limit for medical payments coverage is a different situation.
Your entitlement to payment is not affected by who is/was at fault
in the accident. Typical medical payments coverage on a State Farm
policy, for example, is $10,000 or $20,000. That amount can go a
long way toward offsetting co-payments and deductibles in a serious
injury case. Some other insurance carriers offer very low medical
payments coverage limits (such as Nationwide's $500 and $1,000 typical
coverages). Low medical payment policy limits are of virtually no
help in serious situations.
While you are thinking about policy limits, do not forget to verify
that your coverage for damage to your car or other vehicle is at
least equal to the value of the vehicle that you are insuring. It
is an unwelcome shock when you suffer damage to a $25,000 vehicle
only to find that your insurance policy only covers up to $10,000
on the loss. Note also that most property damage coverages are subject
to deductibles, similar to the deductible which is contained in
typical health insurance policies. The deductible means that for
any loss, you pay personally for the loss up to the amount of the
deductible, after which the insurance company takes over payment
up to the amount of the policy limit.
Who Is Covered?
Other than yourself, you may not realize that when you buy an insurance
policy, you are buying protection for a number of other people too.
Protected people might include your family members, your passengers,
and any person whom you allow to drive your car.
Liability Coverage Follows The Car
Generally, purchased insurance applies to the vehicle that you insure,
no matter who is driving it. If there is a crash, and the person
driving your car has his own insurance, your insurance (the insurance
you bought on the car) still pays first. If the insurance on your
car is used up in paying for the driver's liability (damage caused
by a driver of your car), then the driver's insurance begins to
pay next. After that, if both the insurance covering the car and
the insurance covering the driver are insufficient, the injured
parties can next seek compensation from their own insurance policy's
underinsured motorist coverage. When that happens, you may be faced
with a personal claim made against you by the other person's insurance
company if your lawyer has failed to negotiate a complete release
before your own policy limits were paid.
Your Liability Insurance Goes Where You Go
Most insurance policies protect you (and insured family members)
regardless of whether you are driving your car, driving someone
else's car, driving a rental car, or driving a recently purchased
car (for a short period of time). Therefore, to some extent the
insurance policy sticks with the car (as described in the preceding
section), and to some extent it sticks with you (and family members)
subject to any specific exclusions listed in your insurance policy.
Therefore, you should be entitled to coverage regardless of what
you are driving. Be aware, however, that your coverage may not "follow
you" into other countries. Before leaving the United States,
make sure that your current insurance policy will protect you, or
purchase separate insurance specifically for that purpose.
Family members who reside at least occasionally at your home may
be covered in many more situations than you realize. If family members
are covered, liability insurance may protect them, regardless of
what they are driving. Even when not insured for liability, resident
family members are usually covered by medical payments and uninsured/underinsured
motorist coverage under your car insurance policy.
In most situations, for example, if a child in your household is
struck by an irresponsible driver who has inadequate insurance,
your uninsured/underinsured motorist coverage (and possibly your
medical payments coverage) is available to compensate your child,
even though neither you nor your family vehicle was anywhere near
the scene of the crash. The same is true if your child or other
resident family members are injured while riding as a passenger
in someone else's vehicle. Ordinarily, they would still be covered
under your insurance policy.
What about the situation where you or someone in your family causes
a crash that injures other family members or passengers in the same
vehicle? Most insurance companies do not tell you this, but your
insurance liability coverage also protects and provides compensation
for family members (and other passengers) in such situations. Technically,
the family member or injured passenger must make a claim against
the driver (you may have been the driver), but the insurance company
has no excuse for not paying for the injuries of that person. Remember,
you did not buy insurance coverage just to protect total strangers.
Unlike voter registration, for purposes of insurance coverage a
person can have more than one residence at the same time. This is
important when it comes to family members attending school, in the
military, or temporarily working at another location. It is also
important when a family owns or occupies two or more homes.
Typically, people do not buy a separate insurance policy for a covered
family member who is living elsewhere to go to school, work, or
serve in the military. If there is a loss in such situation, it
is important to leave no doubt with the insurance company on the
issue of dual residency. Tell the company that your family member
kept residency at your home. If the family member intended to keep
partial residency at your home, the policy language should provide
WHAT/WHO IS NOT COVERED?
There are two basic places to look in your policy (insurance agreement)
to determine whether or not somebody or something is covered under
your insurance. First, to be covered, the loss has to be described
in the insuring agreement. Second, it cannot be described in the list
of items specifically not covered (the exclusions).
In almost any insurance policy, the contract includes a relatively
short paragraph, often called the "insuring agreement,"
which describes what the insurance company is agreeing to pay for.
There is some type of "insuring agreement" paragraph with
regard to each of the coverages described in the policy (i.e., liability,
medical payment, uninsured/underinsured, and auto damage). For example,
a typical insuring agreement for liability coverage says that the
insurance company will pay damages for bodily injury or property
damage for which you become legally responsible because of an auto
accident. The important thing to remember is that if the loss for
damages does not come within the description of the "insuring
agreement", it is not covered.
Somewhere buried in almost every insurance policy, far beyond the
"insuring agreement" described immediately above, is a
section that pulls out and eliminates many of the losses that would
otherwise fit within the description of the "insuring agreement."
These exceptions are often referred to as "exclusions."
If something is listed in the "exclusions," that means
the insurance contract does not provide for payment of the described
item. You should look at your policy to see what is excluded. Typical
exclusions include claims by the United States Government, claims
from people who are covered by worker's compensation, and claims
for damages that occur if you would use your car for commercial
services, such as taxi service, auto repair business, or other business-related
Trusting Your Insurance Company
Most of us rightfully trust our insurance agent. The agent tries to
help policyholders like you and me purchase coverage that reflects
our needs within the limitations of what we can afford. However, trust
of the insurance company itself is a totally different matter from
trusting your agent.
The Insurance Company
Unlike the agent who sold you the policy, the insurance company
(i.e., State Farm, Nationwide, Progressive, or whatever company
is actually named on your policy) does not know you and does not
have feelings of like, dislike, or concern for you. The insurance
company is a corporation owned by stockholders and operated to make
a profit for the stockholders. For that reason, what the insurance
company will do, or will not do, is determined only by the words
in the insurance contract and the law of the state where the contract
is being applied. The insurance company will pay as little as possible
on your claim or the claim of anyone else.
The person who administers the insurance contract between you and
an insurance company is commonly referred to as an "adjuster."
Even in cases involving your own insurance company, the adjuster
works for the insurance company, not your insurance agent. The adjuster
gathers the facts about the loss that you or another person has
suffered, compares those facts with the insurance policy, determines
whether or not the incident is covered by the policy, and makes
a decision as to what the insurance company will or will not pay.
The adjuster's primary loyalty is to the insurance company, not
to you or your insurance agent.
Why Will An Adjuster Call Me?
In the event of an accident, an insurance adjuster may call you
representing your insurance company, or an adjuster may call you
representing someone else's insurance company. In either event,
the adjuster is reviewing the loss and attempting to determine how
to resolve the loss by paying out the least amount of insurance
company money possible. The adjuster is calling you to gather information
which will help the adjuster accomplish that task.
Must I Talk To The Adjuster?
If the adjuster is calling on behalf of an insurance company that
covers somebody else, you have no duty to speak with that adjuster.
If the call is related to injuries that you have received, the adjuster
is attempting to gather facts to determine whether you or the other
person is at fault. If the adjuster finds that the other person
is at fault, the adjuster will gather facts to try and determine
how much will be paid.
Adjusters are highly trained for both tasks. Their calls are carefully
scripted based upon extensive psychological research, studies, focus
groups, and the experience of the insurance company and adjuster
with regard to similar claims. Some adjusters will intentionally
deceive you. For example, at one time Allstate adjusters representing
the other person were instructed to tell you that they were your
insurance adjuster. You do not have to speak with an adjuster without
your attorney being present on the call or at the interview. If
in doubt, contact an attorney.
How About My Own Insurance Company's Adjuster?
If you are involved in a crash, your insurance company will assign
an adjuster to assess whether or not you will be found at fault,
and if so, how much money the loss is expected to cost the company.
Under the terms of your insurance policy, you are required to cooperate
with that adjuster in terms of providing truthful and timely responses.
Even in that circumstance, however, there is nothing in any insurance
policy that prevents you from consulting an attorney who has your
interests at heart. That becomes particularly important if there
is a question of whether or not the insurance will apply on your
behalf. In a close call, a trained adjuster can cause you to say
things that will invalidate your insurance coverage. If that happens,
you will be left holding the bag despite the thousands of dollars
you have paid in insurance premiums.
You may also be contacted by an insurance adjuster from your own
company who is responsible for uninsured or underinsured motorist
coverage. At that point, your own insurance company is defending
and representing the other driver, not you. That adjuster is not
on your side. If a lawsuit should occur, your uninsured/underinsured
insurance adjuster and an attorney hired by your insurance company
will both be working directly against you. For that reason, it is
appropriate and fair for you to specifically inquire as to which
coverage an adjuster is inquiring about. It is unethical and possibly
illegal for the insurance company to use information acquired while
defending you (information that you provide to your liability coverage
adjuster) against you when you make a claim for the uninsured or
underinsured motorist coverages.
Your Duty After A Crash Or Loss
Virtually all insurance policies make it your responsibility to
promptly contact your insurance company and report any crash or
loss which may be covered directly or indirectly by the insurance
policy. In addition, the insurance policy will require you to cooperate
with the insurance company with regard to the investigation and
defense of claims against you. Most policies provide that if you
fail to do either, the insurance company can refuse to pay for the
loss. Both provisions make good sense, because if you are asking
the insurance company to protect you, it would be illogical for
you not to cooperate.
6. Will My Case Go To Court?
Most insurance claims never make it to court. The vast majority are
resolved before that point by agreement. However, when the parties
cannot agree, the case will necessarily end up in court. When insurance
companies refuse to pay valid claims, injured people have no place
else to go.
Do I Need A Lawyer?
Most small insurance claims are resolved without legal representation.
If you get a dent in your car, ordinarily you do not have any reason
to call a lawyer to get your insurance agent to issue a check and
put you back on the road. Often your agent has the authority to
pay such claims without the use of a company adjuster. Also, if
you suffer a minor injury with only a few hundred dollars in medical
bills, you can often obtain fair compensation from most reputable
insurance companies with little or no legal assistance.
However, when injuries are serious or property damage is severe,
you almost always need an attorney. Take advantage of a free attorney
consultation with an experienced personal injury law firm. A reputable
attorney who primarily practices in the field of vehicle and insurance
litigation can explain the issues that you will face so that you
can make an accurate assessment as to whether or not legal counsel
will be needed.
Will I Need To File A Lawsuit?
Lawsuits become necessary when insurance companies fail to pay valid
claims. That can occur for a number of reasons. Sometimes it is
based on an insurance company's corporate decision to "low
ball" claims. Sometimes it is due to a failure of communication
with regard to the facts or damages, and sometimes it is simply
an honest disagreement as to the amount of fair compensation to
which the injured party is entitled. Regardless of the reason, if
your attorney and the insurance company lawyer or adjuster cannot
come to an agreement, the only remaining choice that you have is
to file a lawsuit.
Do All Lawsuits Go To Trial?
Our experience at Hill, Peterson, Carper, Bee & Deitzler, PLLC
tells us that only about five to ten percent of filed lawsuits make
it to the courtroom. After a lawsuit is filed, the exchange of information
between your attorney and the other party and the insurance company
becomes much more intensive. Sworn statements (called depositions)
will be taken of you, many of your doctors, witnesses to the accident,
and the other party. Experts are hired. The insurance company has
the right to have you examined by their paid doctors. Sometimes
the case will be diverted to arbitration by agreement. Sometimes
mediation is conducted instead. When any case is placed in litigation,
additional expenses are incurred by both parties. Each side ordinarily
makes a serious effort to compromise and reach an agreed resolution.
If that fails, there is no place else to go other than a courtroom
If There Is A Trial, Then What?
A trial means that you and the other people involved will go to
a courtroom before a judge and present your respective positions
to a jury. The jury is made up of randomly selected citizens who
will do their absolute best to treat both sides fairly. The jury
is not told that the real dispute is between you and the other person's
insurance company. The jury usually thinks that the other person
had to personally hire a lawyer, and usually the jury believes that
the other person will have to pay the verdict from his/her personal
resources. Ordinarily, nothing could be further from the truth.
The other person's insurance company will hire a lawyer who will
tell the jury that he/she represents that other person. Neither
the lawyer nor the client will mention the fact that the insurance
company is paying for both the lawyer and the full amount of any
verdict that will result. Similarly, the jury is not told that your
legal fees, and case expenses, will by paid by you, nor the fact
that reimbursement of all of your medical bills to your health insurance
carrier will also be paid by you out of whatever verdict the jury
returns. Therefore, at the point when all other options have failed
and your case lands you in front of a jury, it is critically important
to have a competent attorney at your side. In spite of all of the
obstacles which we have just described, a trial may be your only
chance to receive justice.
Who Gets The Money?
When a claim is resolved with or without a lawyer, regardless of
whether the resolution is through settlement or trial, you are still
personally responsible to pay the medical bills or vehicle repair
bills related to your settlement or verdict. If your medical bills
have been paid through health insurance or government benefits,
the health insurer or government almost always has a right to be
repaid out of the money which you receive. The legal/technical term
for that repayment right is called "subrogation." Sometimes
you or your attorney can negotiate a reduction of the amount which
you owe, but subrogation claims cannot be ignored.
Sometimes the medical provider will agree to defer collection efforts
on medical bills until the end of your case. However, the fact that
you have received money, or have not received money, to resolve
your claim does not relieve you from the obligation of paying your
medical bills. Medical providers expect to be paid regardless of
whether you get car insurance money or not. Sometimes, your attorney
can negotiate a reduction in the amount of medical bills owed if
you do not receive enough money to pay outstanding medical bills.
The same situation of personal responsibility applies with regard
to the cost of repairing or replacing your car. Regardless of whether
the insurance company compensates you or not, you will be expected
to pay the bill. In addition, be aware that if the amount of compensation
from the insurance company is insufficient to pay off the value
of your car in a total loss claim, you will still be stuck paying
the difference to the bank.
You need to be aware that in today's world, nobody gets double payment.
If you get money through an insurance claim or litigation for something
that somebody else has already paid for, in most cases that money
must be paid back to the person or company who made the original
payment. Sadly, when your case goes to trial, the law prohibits
the jury from being told about the fact that the payments that have
already been made on your behalf, will necessarily be repaid from
the verdict that the jury returns. Instead, the jury mistakenly
thinks that your health insurance paid the bills and you will get
to keep the money.
We at Hill, Peterson, Carper, Bee & Deitzler, PLLC have included
this information explaining your obligation for bills and repayment
because most insurance adjusters do not tell you about it. Typically,
the adjuster offers you a lump sum settlement, and more often than
not, you may mistakenly assume that the insurance company's settlement
money is in addition to any amounts which you have previously received.
Attorneys In Cases Involving Insurance
We invite you to contact us for a free
consultation about insurance claims.
you need to hire an attorney to recover an insured loss, the attorney
who accepts your case should do so on a contingent fee basis. That
means that attorney fees are paid only as a percentage of the amount
recovered. If there is no recovery, the attorney receives no fee.
Experienced attorneys ordinarily advance expenses on the same basis.
The expenses are reimbursed in addition to the contingent fee only
if the case is successful. If there is no recovery on the case,
most attorney fee contracts provide that there will be no repayment
of expenses either.
The fee and expense arrangements must be in a written agreement,
signed by both you and the attorney. Do not allow an attorney to
represent you unless a written fee agreement is signed. Also, beware
of attorneys who expect you to advance expenses from your own pocket.
The rationale behind contingent fee agreements is that the attorney
accepts the risk of loss so that you do not have to take a chance
of being in worse financial shape at the conclusion of the case
than you were when you started.
Peterson, Carper, Bee & Deitzler, PLLC accepts motor vehicle
accident cases on a contingent fee basis and all fee arrangements
are provided to clients in written form. Please Contact
Us for additional information or a free consultation.
Hill, Peterson, Carper, Bee & Deitzler, PLLC