Auto Insurance Lawsuits: Timing And Your Rights Explained

If you've been in a car accident, you might be wondering about the role your insurance company will play in any legal proceedings. Most liability car insurance policies include a duty to defend clause, meaning the insurance company will provide a lawyer for the policyholder if they are sued for injuries and other losses (damages) resulting from the crash. However, there are exceptions to this rule, and it's important to understand when you might need to hire your own attorney. For example, if you didn't notify your insurance company of the accident within the specified time frame, they may not be obligated to provide you with a lawyer. Additionally, if the damages paid out by the insurance company meet your policy's coverage limits, they may no longer be required to provide legal representation. Understanding your insurance policy and your state's laws is crucial in determining if your auto insurance law suit is on time.

What to do if you're being sued for a car accident and have insurance

Being sued for a car accident can be a stressful experience, but if you have insurance, there are several steps you can take to protect yourself. Here's a guide on what to do if you're being sued for a car accident and have insurance:

Contact Your Insurance Company

The first step is to notify your insurance company as soon as possible. Provide them with the details of the accident, including any relevant documentation, such as police reports, medical records, and witness statements. It is crucial to do this promptly, as most insurance policies require immediate notification of a claim or potential claim. Your insurance company will then evaluate the facts, gather evidence, and determine fault.

Understand the Lawsuit

If a lawsuit is filed against you, take the time to understand its specifics. The plaintiff (the person suing you) typically seeks monetary compensation for their losses, known as damages. These damages can include medical bills, lost wages, pain and suffering, and other accident-related expenses. The plaintiff's attorney will gather evidence to prove that you were at fault and that their client suffered injuries as a result.

Seek Legal Representation

Your insurance company will typically provide you with a lawyer to defend your case. This falls under the insurance company's "duty to defend," which is usually included in liability insurance policies. However, there may be exceptions to this obligation, so it's important to carefully review your policy. In some cases, you may need to hire your own attorney, especially if the insurance company disputes coverage or reserves their right to deny coverage later.

Protect Your Assets

If the plaintiff wins the lawsuit, the court may authorize the seizure of your assets to pay for the awarded damages. This could include garnishing wages, placing liens on property, or forcing the sale of assets. Consult with an attorney to explore asset protection strategies or negotiate an affordable payment plan with the plaintiff. It is important to act within your legal rights and avoid engaging in fraudulent activities, such as hiding assets.

Consider Settlement Options

In many cases, car accident lawsuits can be settled without going to trial. Your insurance company will typically attempt to negotiate a settlement with the claimant on your behalf. This process involves determining fault, assessing damages, and reaching an agreement on a settlement amount. If the claimant's demands exceed your insurance coverage, you may need to explore alternative options, such as increasing your policy limits or seeking additional legal advice.

Stay Informed and Seek Support

Throughout the legal process, stay informed about your rights and responsibilities. Review your insurance policy, understand the applicable laws in your state, and consider seeking independent legal advice if needed. Remember that being sued can be emotionally challenging, so don't hesitate to seek support from family, friends, or a trusted advisor.

When your insurance company might not provide a lawyer

When you're accused of causing a car accident, your car insurance company will usually hire a lawyer to defend your case in court. However, there are some exceptions to this rule, and it's important to know when you might be responsible for hiring (and paying for) your own attorney.

• Failure to Notify: If you, the policyholder, fail to notify the insurance company of the accident within the specified time limits, the company may be within their rights to refuse coverage and legal support. This time limit can be as short as 5 to 10 days, and a delay can hinder the company's ability to investigate the accident. Hospitalization or mental/physical incapacitation can be valid reasons for not notifying the company promptly.
• Intentional Act: Automobile insurance typically covers negligent actions, not intentional ones. If the policyholder is accused of causing the accident on purpose, the insurance company may refuse coverage and deny providing a lawyer. For example, drunk driving may be considered an intentional act.
• Policy Limit Exceeded: If the damages paid out by the insurance company meet or exceed the policy's coverage limits, the company may no longer be obligated to provide legal support. Once the insurer has fulfilled its contractual obligations, it has no further duty to the insured.

It's important to carefully review your insurance policy to understand your rights and responsibilities, as well as any exceptions that may apply. If you find yourself in a situation where your insurance company is not providing legal support, consider consulting a civil litigation attorney or a personal injury lawyer to guide you through the process and protect your interests.

Reasons an insurance company may deny your claim

There are several reasons why an insurance company may deny your claim. Here are some common reasons for claim denials:

Policy Exclusions and Limitations

Insurance policies often contain various exclusions and limitations. For instance, your policy might exclude certain types of damages, such as "acts of God" or natural events, or it may have specific coverage limits. If your claim falls under an excluded category or exceeds the policy limits, the insurance company may deny your claim.

Lack of Coverage

Your insurance policy may not cover all types of damages or losses. For example, if your policy does not include coverage for the contents of your home, you cannot claim compensation for damaged personal property.

Non-Payment or Lapsed Policy

If you missed paying premiums or failed to renew your policy on time, the insurance company may consider your coverage inactive or lapsed. In such cases, they can deny claims arising during the period of non-payment or lapse.

Misrepresentation, Fraud, or Misleading Information

Insurance companies may deny claims if they find that the claimant provided misleading or false information during the application process or when filing the claim. This includes omissions or misrepresentations that could impact the validity of the policy.

Missed Filing Deadlines

Most insurance policies have strict deadlines for filing claims. If you fail to submit your claim within the required timeframe, the insurance company is likely to deny it.

Insufficient Evidence or Lack of Supporting Documentation

Insurance companies often require comprehensive evidence and documentation to support your claim. This can include medical records, repair estimates, witness statements, and other relevant paperwork. If you cannot provide sufficient evidence to prove the validity of your claim, the insurance company may deny it.

Failure to Mitigate Loss

If you do not take reasonable steps to minimise further damage after an incident, your insurance company may refuse to cover the additional costs.

Negligence or Failure to Maintain Property

If the insurance company believes that the damage to your property resulted from your negligence or failure to properly maintain it, they may deny your claim for repairs or compensation.

Avoidable Accident or Fraudulent Claim

Insurance companies may deny your claim if they believe that the accident could have been avoided or if they suspect that your claim is fraudulent. For example, if you did not report the accident immediately or did not seek prompt medical attention, the insurer may question the validity of your claim.

What to do if your insurance company won't provide a lawyer

If your insurance company is refusing to provide a lawyer, there are several steps you can take to protect your interests and seek legal assistance.

Firstly, it is important to understand your insurance policy and rights. Review your existing policy thoroughly to know what is covered, what needs to be done to file a claim, and the expected timelines for processing a claim. Knowing your rights in case of a dispute is also crucial, and this information should be outlined in your policy or discussed with your agent or insurance provider.

Secondly, keep detailed records of all interactions with your insurance company. Document every conversation, email, and correspondence, including the dates, names of representatives, and a summary of what was discussed. Additionally, maintain records of your insured property, such as receipts and pictures, especially if you need to file a claim for damage or loss.

Thirdly, consider enlisting the help of a lawyer, especially if your case is complex or involves a significant claim amount. Consult with a specialist lawyer who has experience with insurance lawsuits. Many lawyers offer free initial advice, so it is worth contacting them to understand your options and rights. They can help you interpret legal jargon, review your policy, and determine if your insurance company is acting in bad faith by denying your claim.

If you decide to hire a lawyer, choose one with extensive experience in insurance litigation. Insurance law can be complex and time-consuming, so it's important to have a knowledgeable advocate on your side.

Finally, be persistent in your communications with the insurance company. If you're unable to reach a settlement or are facing delays, speak with the adjuster's supervisor or claims manager. You can also contact your state's department of insurance, as they have a consumer complaint division that can assist with disputes. Additionally, consider reaching out to your insurance agent or writing to an executive at the insurance company to escalate the matter.

Remember, it is crucial to act calmly and patiently throughout the process, as taking your insurance company to court should be a last resort. By following these steps, you can effectively navigate the situation when your insurance company won't provide a lawyer.

How to know if your insurance claim is taking longer than it should

The time it takes to settle an insurance claim can vary from a few days to several months, depending on the circumstances of the accident and other factors. These factors include the severity of the injury and property damage, the number of people involved, state laws, and whether lawyers are involved.

To know if your insurance claim is taking longer than it should, consider the following:

• Most states have a deadline for insurance companies to acknowledge a claim, typically within 15 days of receiving it. If you haven't heard back from the insurance company within this timeframe, your claim may be taking longer than usual.
• Insurance companies usually have about 30 days to investigate your claim, but this can vary by state. If the investigation is taking longer than this timeframe and you haven't received any updates or requests for additional information, it may be a cause for concern.
• The number of people involved in the claim can impact the timeline. If there are multiple parties involved with different insurance companies, it may take longer for the insurers to determine liability and process the claim.
• Insurance companies may request extensions if they need more time to make a decision or investigate further. While this is a standard practice, frequent or lengthy extensions may indicate that your claim is taking longer than necessary.
• If you feel that the insurance company is deliberately stalling or using delay tactics, such as repeatedly requesting additional information or avoiding your communications, your claim may be taking longer than it should.

It's important to review your state's laws and guidelines for insurance claims, as they can vary. Additionally, consider seeking legal advice or consulting a personal injury lawyer to understand your rights and options if you believe your insurance claim is taking longer than it should.

Frequently asked questions