Insurance Company Issues

Published on: December 12, 2016

Court Finds Insurance Company May Have Acted in Bad Faith by Denying Claim Without Sufficient Investigation

In a recent case, a passenger sued after she was injured in a car accident. A man had bought his fiancée a van for her birthday. On her birthday, the couple was drinking with some friends, and the man gathered the friends in the van. He then drove the van and crashed it, causing one of the passengers serious injuries. The passenger received compensation for her injuries from the man’s insurance, but she said the amount she received did not cover her injuries and made an additional claim for underinsured motorist benefits. Since the man’s coverage did not cover her expenses, she claimed he was “underinsured,” so she should receive underinsured motorist benefits from her insurance policy and from the driver’s fiancée’s policy.

The insurance company denied the claim at first. The passenger then sued the insurance company, claiming the company unreasonably denied her claim or delayed in paying her. The insurance company eventually paid her additional compensation. However, the passenger still claimed the insurance company unreasonably denied or delayed payment—essentially stating that the company acted in bad faith in doing so.

A federal trial court granted summary judgment in favor of the insurance company, finding it did not unreasonably deny or delay payment. But the passenger appealed, and a federal appeals court reversed the decision, deciding a reasonable jury could find the insurance company failed to reasonably investigate her claim.

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Published on: August 31, 2016

Court Finds Car Insurance Company’s Policy Ambiguous and Finds in Favor of Injured Mother

By Moll Law Group

In a recent case, a woman and her two children were injured in a car accident with another motorist. The woman filed a lawsuit against the other driver for their injuries. More than three years after the car accident, the woman amended her complaint to add a claim against her insurance company, since she believed that the other driver’s policy would not fully cover her damages.

The insurance company’s policy required claims to be filed within three years of the accident, so the insurance company argued that the claim was barred because it was filed after more than three years. The woman put the insurance company on notice about two years after the accident that she would likely pursue an underinsured motorist claim. Yet she did not file it until later, when she believed the other driver’s policy would be insufficient after pursuing the lawsuit against the driver.

In a recently released opinion, the state’s supreme court held that the claim was not barred. It explained that while the insurance company’s policy required lawsuits to be filed within three years, the insurance company also had a policy that it would only pay if the underinsured motorist’s insurance had been exhausted. Therefore, insured individuals were being told to file a lawsuit within three years, but at the same time they were being told not to file a lawsuit until other avenues were exhausted. The court explained that these two policies were in direct conflict with each other, and thus the policy was ambiguous. As a result, the court interpreted the terms in favor of the insured, allowing the case to continue against the insurance company.

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Published on: June 21, 2016

Student Hit While Crossing the Street to Board School Bus Entitled to Benefits Under Bus’ Insurance

By Moll Law Group

School bus drivers’ duties may be considered to start and end with children getting on and off the bus. But school bus drivers may also be responsible for making sure that students safely cross the street when entering or exiting the bus. In a recent case, a court held that a bus driver’s duties extended to helping children safely cross the street, and the bus’ car insurance was required to pay benefits as a result.

A girl was on her way to take a school bus to school. After she received a signal from the bus driver, she crossed the street to get on the bus when she was hit by another car. The girl filed a complaint to receive benefits from the bus’ insurance company for her injuries. The state required that car insurance included coverage for “PIP (personal injury protection) benefits,” which provide benefits to those injured in car accidents. The girl was trying to recover PIP benefits that were available to those in the vehicle as well as other people involved in the accident, who were not in another vehicle.

The insurance company that insured the bus argued that it was not “involved in the accident.” However, that state’s supreme court found that it was. The bus driver controlled the process of entering and exiting the bus, and the accident happened when the bus driver signaled for the girl to cross. Part of a school bus’ operation is to safely pick up and drop off students, and that role was clearly involved in this accident. Also, the accident was within the common understanding of a motor vehicle accident, since she was hit by a car while crossing to board the bus. Finally, even if the other driver may have been at fault, the girl was still entitled to PIP benefits, since the bus was involved in the accident. Therefore, the girl was entitled to the benefits from the bus’ insurance company.

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Published on: May 9, 2016

Uber and Lyft Drivers May Not Be Fully Covered by Insurance

By Moll Law Group

Drivers for companies such as Uber and Lyft do not have to be professional drivers. They can be any person with a car and a smartphone. And while drivers may have their own personal insurance, it often does not cover business activities.

In general, drivers’ personal car insurance policies do not provide coverage when drivers are using their cars as transportation for companies like Uber and Lyft. And the companies’ insurance often does not cover them in all of their business-related activities—leaving them and other drivers at risk if they are involved in an accident.

For example, if a driver gets in an accident on the way to pick up a passenger, the company’s insurance may not cover the accident because no passenger was in the car at the time. This means that once the driver submits the claim to his or her insurance company, the insurance company could deny the claim because the driver was conducting business activity. The ride-share company may also deny coverage because no passengers were in the car at the time of the accident. This could mean that the driver is responsible for paying for his or her own damages and injuries, as well as those of the other driver. If the driver is unable to pay, injured parties may have no recourse.

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Published on: March 25, 2016

Jury Award of Zero Dollars to Plaintiff Upheld on Appeal

By Moll Law Group

Juries decide cases with respect to the liability of the parties and in regard to the damages owed. In a recent case, a jury found that a defendant was liable—yet it also found that the plaintiff should be awarded nothing.

After a woman was injured in a car accident, she and her husband sued her insurance company to recover damages for her injuries under the underinsured motorist provision of their policy. Prior to trial, the defendant admitted that the driver of the car that hit the plaintiff was negligent. However, the case proceeded to trial on the issue of causation and damages. At trial, the woman admitted that all of her medical bills had been paid. Accordingly, the plaintiffs were only seeking damages for pain and suffering.

The jury was required to determine the amount of damages the plaintiffs should be awarded. When the jury returned a verdict in her favor, but with an award of no damages, the plaintiffs filed a motion for a new trial. The motion was denied, and the plaintiffs appealed the decision. On appeal, the plaintiffs argued that a jury verdict for the plaintiff must necessarily include an award of damages.

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