Responsibility, Duty, Liability
- Your insurance company has a duty to treat you fairly, and to protect you from third-party claims, because you bought the liability insurance, whether on your home or on your automobile.
- The insurance company has to protect your interest when settling your claim
- The insurance company must negotiate the claim rather than just protecting the company’s own interest, or they can be liable to you for not protecting your interests.
If you bought a policy that says it is a 15/30 policy, and you injured someone and the damages exceed $15,000.00, the insurance company does not have to pay more than the $15,000.00 in coverage.
If the other party is willing to settle for the $15,000.00 and liability is reasonably clear, and the damages equal or exceed $15,000.00, the insurance company has to pay the $15,000.00.
Insurance Bad Faith Lawsuit:
- If, AS IN THE ABOVE CIRCUMSTANCE, the insurance company does not pay the $15,000.00, then you might be able to sue your insurance company for what is called First-Party Bad Faith in an insurance bad faith lawsuit.
- Your insurance company must treat you fairly, and must not expose you to a judgment far in excess of the amount of the coverage when the insurance company could have settled the case within the coverage limits.
- Under these circumstances, you could sue with an insurance bad faith lawsuit for not only the amount you are personally responsible for to the third-party, but you could also sue for your emotional distress and general damages, and for punitive damages to punish the insurance company for not treating you fairly.
For further information see the related sections: