Excess verdicts in car wrecks, other personal injury, and wrongful death cases

Insurance companies have gotten so emboldened by their success in the political and judicial arenas that they make low-ball offers to settle car accident, wrongful death and other injury cases. However, after pride comes the fall. In defending these cases, the insurance company has a duty to their insured to protect them from what is known as an excess verdict. For example, if an insured only has $25,000 in insurance coverage and kills or hurts someone severely in a car crash, the insurance company must pay the full amount to protect their insured. If not. the Alabama Supreme Court has held the following:

When an opportunity is presented to the insurer to make a settlement of the claim in an amount not more than the limit of liability, the law raises a duty on his part to use ordinary care to ascertain the facts on which its performance depends if he has not already done so. If the insurer neglects to exercise ordinary diligence in ascertaining these facts, if he has not already done so, and as a proximate result of such neglect he fails to make such a settlement, which is available, and when such knowledge would have caused a reasonably prudent person to do so and a verdict and judgment are rendered against [the] insured in an amount more than the limit of liability in the policy, the insurer should be held liable to the insured for the full amount of the judgment.

Despite this law, insurance companies still play games. I have had several cases where this exact situation has happened because of improper conduct by the insurance companies. Beware.

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