Insurance Settlement Practices

---

FREQUENTLY ASKED QUESTIONS

I’ve just had a car accident. What should I do?

First, you should seek medical attention immediately, even if you think you may not be hurt. Often times, injury symptoms will surface over a matter of days, or even weeks. Only your doctor will be able to determine the extent of your injuries. Second, you should obtain a copy of the Crash Report and/or file an accident report with the police. Third, if possible, take photographs of the scene of the accident, your vehicle, and any injuries you have. Fourth, be weary of any communications from the other drivers’ insurance company representative. They do not have your interest at heart. Do not sign any document or allow them to take your recorded statement. Finally, seek the advice of an experienced auto accident attorney as soon as possible.

What is the role of an insurer?

Simply put, insurance companies agree to accept risk in consideration of policy premiums. Insurers spread risk, such as the risk of an auto accident, over a large pool of drivers. In the event that there is a covered loss, insurers are supposed to pay what they are legally obligated to cover, the amount their insured is legally responsible for. In practice though, insurers will often attempt to pay less than what their driver is legally responsible for. In fact, in many cases it seems like the role of an insurance company is merely to collect premiums and then deny claims. A car accident attorney on your side can go a long way in helping you obtain fair compensation for your loss.

What is the minimum amount of insurance coverage mandated by state law?

Under Texas law, specifically the Safety Responsibility Act, codified in the Texas Transportation Code, drivers must have at least the following minimum coverage:

$25,000.00 for injuries per person per accident;

$50,000.00 for injuries per accident (if more than one person was injured); and

$25,000 for property damage per accident.

When buying car insurance for your own vehicle, you should consider purchasing more than minimum coverage. If you are responsible for an accident that causes injuries, their medical expenses may easily exceed your coverage. And any damages you cause that go beyond your insurance coverage will be your responsibility.

Who is covered under a standard auto liability policy?

Generally, the named insured (“you”), your spouse, any family member and anyone using the covered vehicle with your permission is covered. Whether a particular driver qualifies as a permissive user is evaluated from the standpoint of the user, not the owner or named insured. If the user reasonably believed they had permission to use the vehicle, they are covered. But your policy may exclude certain drivers from coverage. If an excluded driver is involved in a car accident, the insurer may deny coverage for the accident.

What is PIP and UM coverage and when does it apply?

PIP stands for Personal Injury Protection, and unless waived in writing by the insured, it is part of any auto policy written in the State of Texas. By statute the minimum amount of PIP coverage is $2,500.00, and it covers everyone in the insured vehicle up to the PIP limits. PIP also covers every insured no matter what vehicle they are in. So, for example, PIP coverage would apply to a named insured that was injured in someone else’s vehicle. In order for PIP coverage to apply, a motor vehicle accident must first occur. Some insurance policies have a double indemnity clause in the event that a covered person was killed while wearing a safety belt in an car accident.

UM, or uninsured motorist / underinsured motorist coverage, is similarly mandated by statute in Texas. And like PIP coverage, it can be waived by the insured in writing. If you are in an accident in which UM coverage applies and your insurance company tells you that you do not have that coverage, always demand to see a copy of your signed rejection page. Unless the insurance company can show that you were given the opportunity to obtain UM coverage but expressly rejected it in writing, you will be covered. And in at least one case, I have seen an insurance company forge the PIP / UM rejection.

When buying insurance, it is always prudent to elect to have PIP and UM coverage due to the high incidence of uninsured drivers in Texas. Having PIP and UM coverage after an accident with an uninsured, underinsured, or hit-and-run driver can be an enormous benefit, especially if there are serious injuries. The sense of relief you will have in knowing that you are covered after an accident is well worth the marginal increase in your policy premiums. If the driver at fault has no or insufficient insurance, the UM carrier steps in and acts as that third party’s carrier, meaning the insured is entitled to receive from the UM carrier what the insured would have been entitled to obtain from the negligent driver. Claimants will usually fair better with their own insurance company than they will making a third party liability claim on the other driver’s insurance. Although certain insurance companies have made it routine business practice to treat their own customers no better than any third party claimant.

How much can I expect to receive from my personal injury case?

Each case must be evaluated on its own terms. Generally speaking, an injured claimant may recover compensatory damages for things like medical expenses, past and future, lost wages, past and future, mental anguish, disfigurement, and pain and suffering. In cases of wrongful death, surviving family members may be entitled to loss of financial support and loss of consortium. The total recovery depends upon the degree to which the defendant is liable for the accident, the extent of the claimant’s damages, and the amount of the defendant’s insurance and/or assets. An auto accident attorney can give you a more definitive answer based upon the facts of your case. For convenience, you may e-mail your claim to the Law Office of Brian C. Gutierrez, PLLC for a free, no obligation claim evaluation.

If a lawsuit is necessary, how long will the case take?

The decision to file a lawsuit should be made only after careful consideration of all of the facts and circumstances of your case. Usually, your personal injury attorney will first exhaust the possibility of a pre-litigation settlement before considering filing a lawsuit. If the insurance company for the negligent driver has denied liability or has made a top offer that is insufficient to cover your damages, a lawsuit is necessary. Litigation is very time consuming and it is not uncommon for a case is litigation to take a year or longer. There are a variety of reasons why it can take so long. Many of the legal deadlines for things like the defendant’s written answer, discovery, and certain motions are governed by the Texas Rules of Civil Procedure. Other factors that contribute to how long a case takes are the court’s docket in terms of the availability of a jury trial setting, and the party litigants, witnesses, and lawyers’ schedules. Of course, a settlement is not precluded simply because a lawsuit is filed. On the contrary, in many cases a lawsuit operates as the catalyst for inducing a fair settlement.

I keep getting these letters from my health insurance company asking me questions about my car accident. What does my health insurance have to do with my pending personal injury case?

If you have governmental program health insurance such as Medicare or Medicaid and you have received medical treatment for personal injuries suffered as a result of another’s negligence, Medicare and/or Medicaid must be reimbursed.

With regard to Medicare, federal law mandates a superior lien (a first priority lien that takes precedence over competing liens and your settlement recovery) over personal injury settlements and judgments for conditional medical payments made on behalf of injured claimants. If you have received payment from a third party for medical expenses, Medicare must be reimbursed within 60 days. Medicare liens apply even to your own car insurance, such as PIP (Personal Injury Protection) and UM (Uninsured / Underinsured Motorist Protection) coverage.

If Medicaid has made conditional payment for personal injuries arising out of another’s negligence, Medicaid will have to be reimbursed. The Texas statute regulating Medicaid subrogation (the right of one who has paid an obligation which another should have paid to be indemnified by the other) mandates that by filing, or receiving, medical assistance through the State, the injured person assigns his/her right of recovery from (1) their own personal insurance, (2) other sources, or (3) another person whose negligence or wrongdoing caused the applicant or recipient’s injuries. Like Medicare, Medicaid liens apply to PIP and UM motorist benefits.

If you have private health insurance, such as a plan offered through your employer, your health care insurance carrier will often have subrogation clauses in their contract. These clauses will usually state that the insurer shall be subrogated to all rights of recovery which any insured person may acquire against any negligent person for those injuries in which benefits are provided.

Regardless of which type of health insurance you have, your attorney can assist you in negotiating a reduction of those liens so that you are able to keep more of your personal injury settlement. The Law Office of Brian C. Gutierrez, PLLC has experience negotiating reductions from health care providers and is on hand to assist you.