Auto Insurance Claims: Your Right To File A Lawsuit

Filing a lawsuit against an auto insurance company is a complex process and should be done only when all other options have been exhausted. Before filing a lawsuit, it is important to understand the differences between a car accident insurance claim and a lawsuit. A car accident insurance claim is an informal process where the claimant notifies the insurance company and seeks damages for personal injuries or property damage. On the other hand, a car accident lawsuit is a formal legal action that takes place in a civil court system, with the claimant suing to recover money from the defendant.

There are several reasons why a lawsuit may be necessary. This includes failure by the insurance company to provide a fair settlement, disagreement over the settlement amount, and the statute of limitations approaching. It is important to note that lawsuits are costly and time-consuming, and they may slow down the claims process. Before initiating legal action, it is advisable to seek the help of a qualified attorney who can guide you through the process and improve your chances of success.

Understanding the differences between car accident insurance claims and lawsuits

When it comes to car accidents, there are two distinct legal routes to recovering compensation for damages: insurance claims and lawsuits. While both processes serve this purpose, there are key differences between the two.

Car Accident Insurance Claims

Insurance claims are the more common route taken after a car accident. In this process, you—the person bringing the claim—notify the other driver's insurance company that you are seeking damages for personal injuries or property damage caused by the other driver. This is typically done through the insurance company's online claims page or with a written claim notice letter.

During the claim, you will likely communicate and negotiate with an insurance adjuster assigned to the claim by the insurance company. This process is informal, and there is no independent third party, like a judge, to resolve factual or legal disputes. The claim process generally continues until the case is settled or the parties agree that they cannot settle it on their own.

Car Accident Lawsuits

A car accident lawsuit is a formal legal action that takes place in the civil court system. Here, the "plaintiff" (the person filing the lawsuit) sues to recover money from the "defendant" (the person being sued). During a lawsuit, you (or your lawyer) will communicate and negotiate with the insurance company's lawyer. It's important to note that a lawsuit will likely be costly and time-consuming, and it may slow down or halt the claims process.

In a lawsuit, you must prove the legal elements of negligence to win the case. This includes providing evidence that convinces a jury that the other party owed you a duty of care, breached that duty, and caused the accident that resulted in your injuries and damages.

When to Choose a Lawsuit Over a Claim

While insurance claims are often the first step after a car accident, there are situations where a lawsuit may be necessary or preferable. For example:

• You would rather have a judge or jury decide your case than an insurance company.
• You believe you could be awarded higher damages through a lawsuit.
• You may be eligible for non-economic and punitive damages that are not typically covered by insurance claims.

However, it's important to consider the potential drawbacks of a lawsuit. Lawsuits are generally more expensive and time-consuming than insurance claims, and there is no guarantee of a favourable outcome. Additionally, insurance companies are sensitive to the possibility of litigation, and threatening to file a lawsuit could backfire, leading to increased adversarial behaviour.

Knowing when to file a lawsuit

Exhaust All Alternatives

Before considering a lawsuit, it's important to explore all possible alternatives. Negotiating with your insurer is often a more effective approach than resorting to legal action. If you feel your claims adjuster is being unfair, it is advisable to escalate the matter to a higher authority within the company. Remember, a lawsuit should be treated as a last resort when all other options have been exhausted.

Understand the Implications

It's crucial to recognize the potential consequences of filing a lawsuit. It will likely be a costly, adversarial process that slows down or halts your claims process. Additionally, your insurance company may stop direct communication with you, and you may need to deal with their lawyers instead. The involvement of aggressive attorneys on either side can make it challenging to keep communication open and amicable.

Assess the Strength of Your Case

Before initiating legal action, it's essential to honestly evaluate the strengths and weaknesses of your case. Consider the likelihood of a favourable outcome and whether the potential benefits outweigh the costs and delays associated with a lawsuit. Remember that lawsuits can be time-consuming and expensive, and there is no guarantee of success.

Check Your Policy and State Laws

Review your insurance policy thoroughly to understand its coverage, exclusions, and any specific requirements or limitations. Familiarize yourself with relevant state laws, including the statute of limitations for filing a lawsuit after an accident. Each state has its own deadlines, and failing to file within this timeframe will result in losing your right to sue.

Consult a Lawyer

Consider consulting a lawyer, especially if you have a strong case. They can provide valuable guidance on your legal rights, options, and the likelihood of success. An experienced lawyer will also be able to navigate the complex legal procedures and represent your best interests in court.

In summary, the decision to file a lawsuit against an auto insurance company should not be taken lightly. It is important to carefully weigh your options, understand the potential implications, and seek legal advice before initiating legal action.

Knowing what to expect when suing an insurance company

Suing an insurance company is a complex process that can be costly and time-consuming. It is important to understand the potential challenges and what to expect before initiating legal action. Here are some key things to keep in mind:

Understanding the Process

Know that suing an insurance company is often a last resort after all other negotiations have failed. The process can be highly adversarial, and it is essential to seek legal counsel to guide you through the intricacies of the law. The first step is to hire an experienced attorney who specialises in insurance litigation. They will help you navigate the legal landscape, which can be complex and time-consuming.

The Insurance Company's Response

Once you file a lawsuit, the insurance company will likely assign its own attorney to the case. This may result in a period of silence as they select a lawyer and review your file. Your communication with the insurance company may also change, as they are no longer obligated to communicate or negotiate with you directly. Their lawyers will now handle the matter, which can make the process more challenging and prolonged.

Potential Costs and Delays

Lawsuits are often expensive, and you should be prepared for increased expenses. The case expenses can include court fees, witness costs, travel expenses, transcripts, and more. These costs can quickly add up, even before attorney fees. Additionally, lawsuits take time, and a typical car accident lawsuit can take between nine months to a year to get to trial. If there is an appeal, the case can go on even longer.

Understanding Your Policy and State Laws

It is crucial to thoroughly understand your insurance policy and your rights as a policyholder. Review your policy to identify any ambiguities or unclear terms that may impact your case. Additionally, insurance laws vary by state, and it is important to know your state's specific regulations and protections for insurance consumers. Familiarise yourself with your state's department of insurance and the resources they provide.

Documentation and Record-Keeping

Maintain detailed records of all correspondence with the insurance company and its representatives. Keep copies of emails, take notes on phone conversations, and record the dates and names of representatives. Additionally, keep track of any expenses incurred due to the case, such as repairs, healthcare expenses, attorney's fees, and lost wages. These records will be crucial in supporting your case and seeking compensation.

Alternative Options

Before initiating a lawsuit, consider alternative dispute resolution methods, such as mediation. Most legal disputes are resolved through mediation rather than a courtroom trial. This process can take six months or more, but it offers a potential avenue to resolve the matter outside of court.

Understanding the role of a claims adjuster

A claims adjuster investigates insurance claims to determine the settlement amount for a client in the event of a loss. They can handle any kind of insurance claim, from property damage to personal injury claims. They may inspect a home, business, or automobile and put together a report for claims examiners to evaluate.

There are three types of claims adjusters: staff, independent, and public adjusters. Staff adjusters work full-time for a single insurance company and usually handle claims related to property damage or personal auto claims. Independent adjusters are self-employed contractors who work with multiple insurance companies and often handle catastrophe claims. Public adjusters work for the policyholder and help them file an insurance claim if they believe the proposed settlement is unfair.

Claims adjusters verify policyholder requests for funds and determine a fair settlement amount. They do this by reviewing each case, speaking with the claimant, interviewing witnesses, researching records, and inspecting any involved property. They may also consult with specialists such as physicians, lawyers, engineers, and architects.

It is important to note that claims adjusters work for the insurance company, so they may not have your best interests in mind. If you feel your claims adjuster is not treating you fairly, you can go to someone higher up in the company or consider hiring your own independent claims adjuster to protect your interests.

Knowing your rights and duties when filing a third-party claim

When filing a third-party claim, it's important to understand your rights and duties, as insurance laws differ for first and third-party claims. In a third-party claim, you are not in a direct contract with the insurance company, and their primary obligation is to their own policyholder. Here are some key points to keep in mind:

Your Rights

• Right to File a Claim: If you are in a car accident caused by another driver, you have the right to file a third-party claim with the other driver's insurance company to cover your accident-related expenses.
• Right to Information: You have the right to request information from the insurance company regarding the claim. This includes understanding their decision-making process, such as determining fault and calculating the settlement amount.
• Right to Fair Settlement: You have the right to receive a fair settlement offer from the insurance company. If you believe their offer is unsatisfactory or they deny your claim, you can seek legal counsel or file a lawsuit within the statute of limitations.
• Right to Choose Your Repair Shop: You are not obligated to use the repair shop suggested by the insurance company. However, if your preferred shop charges more, you may need to cover the difference.

Your Duties

• Duty to Initiate the Claim: In a third-party claim, you are responsible for starting the claim process by contacting the other driver's insurance company and providing the necessary information.
• Duty to Cooperate: It is in your best interest to cooperate with the insurance adjuster and provide them with the information they need to assess your claim. This includes details about the accident, your injuries, and any financial losses.
• Duty to Provide Evidence: You are expected to provide evidence to support your claim, such as medical records, documentation of lost income, repair estimates, police reports, and witness statements.
• Duty to Comply with Deadlines: Be mindful of any deadlines for filing your claim and providing the necessary information. Failure to meet these deadlines may result in delays or denial of your claim.
• Duty to Sign a Release for Damages: When accepting a settlement, you will likely be required to sign a release form, agreeing that the amount offered is the final payment you will receive. Carefully review this document before signing.

Frequently asked questions