When Insurance Policy Limits Aren’t Enough: Pursuing Full Accountability in Stamford Catastrophic Injury Cases

Many people assume that if another driver causes a serious accident, their insurance company will simply pay for the resulting damages. Unfortunately, the reality is often far more complicated. This is especially true in catastrophic injury cases, where medical expenses and other expenses can be overwhelming.

The reality about liability insurance is that every policy has limits. Those limits represent the maximum amount the insurance company is required to pay in an accident; you can count on these companies refusing to spend a penny more than they have to. That can become your problem after a crash if your damages are greater than the limits on the other driver’s policy. The good news is that our attorneys can help you explore all of your options.

How Do Auto Insurance Policy Limits Work?

Every automobile liability policy contains coverage limits that establish the maximum amount the insurer has to pay on behalf of its insured. When an accident occurs, the injured party typically files a claim with the at-fault driver’s insurer. The insurer will investigate the crash on its own to determine whether its covered driver was at fault, and it doesn’t always accept liability.

If the claim is resolved through settlement, the insurance company generally pays the agreed amount up to the available policy limits. In many routine injury cases, this process works as intended because the damages do not exceed the available coverage.

Catastrophic injury claims can complicate this process. Someone who suffers a life-changing condition may incur damages that far exceed the available insurance coverage.

For example, a driver may carry a liability policy with limits of $100,000, while the injured victim’s damages total several million dollars. Even if liability is clear and the insurer accepts responsibility, the policy may not provide sufficient coverage to fully compensate the victim.

At that point, the insurance company is generally not obligated to pay beyond the policy’s contractual limits. While obtaining the full policy limits is often an important first step, it may only represent a fraction of the total losses suffered by the injured person.

This reality often forces victims and their attorneys to explore additional sources of recovery, particularly when the consequences of the injury will continue for years or decades into the future.

Low Limits Complicate Settlements

Many people assume that once damages clearly exceed the available insurance coverage, the insurer will immediately offer the full policy limits and resolve the matter. In practice, the process is often much more complicated.

Insurance companies typically do not simply write a check for the policy limits without conditions. In most cases, they will require the injured party to sign a settlement agreement that includes a release of claims. By signing that release, the victim generally agrees not to pursue any additional compensation arising from the accident.

This creates a significant challenge in catastrophic injury cases, in that insurers will force you to choose between taking a low settlement amount or pursuing the full claim through a personal injury lawsuit.

As a result, your attorney will need to carefully evaluate the situation before recommending whether to accept a policy-limits settlement. The decision often depends on factors such as the severity of the injuries and the likelihood that the at-fault party has any available resources to pay the claim.

Suing the At-Fault Driver Directly

When insurance coverage is inadequate, one option is to pursue compensation directly from the at-fault driver. Your civil suit could result in a judgment for the full amount of your claim, but it carries the risk of a jury trial.

What’s more, the other driver’s insurance policy likely provides them with their own legal team, which can increase the likelihood that the case will go to trial.

The reality is that many drivers do not possess sufficient assets to satisfy a substantial judgment. That means even winning a verdict at trial might not lead to anything more than the policy limit amount if there’s nothing to collect from the other driver. Because of these risks, it’s crucial that you speak with an attorney before you attempt to pursue an injury case against an underinsured driver. Our attorneys can help you understand the risks and benefits that come with that approach, and we can also ensure you have a clear picture of what the insurance settlement would look like.

Other Potential Sources of Compensation

In many catastrophic injury cases, the focus extends beyond the individual driver who caused the accident. The first step to recovering the compensation you deserve when the other party is underinsured is to look at other possible defendants. For example, other parties, including vehicle manufacturers, could share in the blame for a crash. You have the opportunity to seek compensation from them as well.

Similarly, some drivers maintain umbrella insurance policies that provide additional coverage beyond standard automobile liability limits. Identifying these policies can substantially increase the funds available to compensate an injured victim.

Your own insurance coverage might also provide you with some options. If you have full coverage, you could get the recovery you need by filing a claim on your own policy, even when the other driver is at fault.

Talk to Slager Madry About Pursuing Justice For Your Injuries

If you’ve suffered a catastrophic injury in an accident that wasn’t your fault, you have the right to seek compensation through a liability insurance claim. Unfortunately, your low policy limits could prevent you from recovering all of the damages you are owed. At Slager Madry, our team is dedicated to helping the injured recover everything they are entitled to. Contact us today for a free consultation.