June 2012 Archives

June 18, 2012

Underinsurance? What Happens if the At-Fault Driver Has Too Little Insurance?

I have written a few previous posts discussing the importance of uninsured motorist coverage on your auto insurance policy if you are involved in a serious auto accident, but no posts focused solely on underinsured motorist coverage. Uninsured motorist coverage will also serve as UNDERinsured motorist coverage if you are involved in a car crash with someone who has too little insurance. In Rhode Island the minimum liability coverage is only $25,000 and in Massachusetts it is even less at $20,000. If you have been seriously injured in a car accident or a motorcycle accident, your medical bills alone might easily exceed these small amounts of money.

Depending on the coverage you have on your policy, and the amount thereof, you may be able to use your uninsured motorist coverage to help pay for the damages over and above the amount of coverage that the at-fault driver maintained. Your insurance company will essentially "take the place of" the at-fault driver's insurance company. There is a major difference between Rhode Island and Massachusetts when it comes to underinsurance law.

Underinsurance in Rhode Island

Rhode Island has more favorable laws than Massachusetts if you have been seriously injured in a car accident and need to utilize your underinsurance coverage. If the at-fault driver's insurance company has paid it's policy limits, whether that amount is the minimum $25,000 or $300,000, but it is less than the full value of your claim, then you can turn to your own policy. Your insurance company will be able to "write-off" the amount that you already received from the other company but you are still entitled to the full value of your uninsured motorist policy no matter how large or small. For example, if your full value is approximately $100,000 and the at-fault driver has a $50,000 policy, then you have roughly $50,000 that you are still owed. If your uninsured motorist policy is equal to $50k or more then you are likely to be fully compensated. If your policy is for the state minimum of $25k, then you are entitled to the full amount but you will still not be fully compensated for your loss.

Underinsured motorist coverage in Massachusetts

The concept and workings of uninsured motorist in Massachusetts is largely the same as described in the Rhode Island section above with one major exception. In Massachusetts, you can not "stack" your insurance policy on top of the at-fault driver's insurance policy. Your coverage amount must be in excess of the at-fault driver's policy or you will not be able to access any money from your own insurance. For example: Your injury is worth $50,000 and both the at-fault driver and your own policy is for the Massachusetts minimum of $20,000. In this scenario you are not entitled to ANY of your underinsured motorist because your policy is not in excess of the at-fault driver's. This is why Rhode Island law is much more advantageous because in this scenario you would be entitled to $40,000 in Rhode Island but only $20,000 in Massachusetts.

Some Other Points

arbitration v. court

If you begin the process of trying to settle your serious injury claim with your own insurance company, you are bound to your insurance contract. This means that you must cooperate with the insurance company in ways that you did not have to with the at-fault driver's insurance company. Another major difference is that many insurance companies have written arbitration provisions into their insurance policies. This means that all disputes, including underinsured motorist claims, must be dealt with by arbitration rather than litigation. This can be either a blessing or a curse, but arbitration is for another blog post.

other household members

Your car accident attorney should also review all of the household members at your residence because their auto insurance policies, if different than yours, might cover you for underinsurance.

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June 11, 2012

How Allstate and Colossus Low-Ball Injury Victims

A new report has been released by a consumer protection agency outlining exactly how Allstate Insurance and programs like Colossus lower the value of your personal injury settlement. I will discuss the prominent points of Colossus below, but you are welcome to read the entire report here.

Most injury victims, particularly those with soft tissue injuries from automobile accidents, are unaware that insurance adjusters rarely determine the settlement value of your case. Instead, a highly sophisticated computer program named Colossus, pre-programmed with tons of data, is the ultimate decision-maker. This software, however, is designed to keep your settlements low.

How Allstate and Colossus Manipulate Settlement Figures

  • Insurance adjusters, with no medical training, are told to contradict and ignore determinations made by licensed and educated doctors. If they believe that a diagnostic test was unnecessary or that a given diagnosis was inaccurate, the adjuster can choose to ignore that information and choose not to enter it into the system;
  • Colossus uses hundreds and thousands of similar cases to determine the value of your particular case. Allstate, however, can choose not to input settlements on the higher end of the spectrum into the system, so that Colossus continues to keep settlement ranges low and ignores high end settlements;
  • Many soft-tissue injury victims seek treatment with a chiropractor for relief of their pain and symptoms. Despite chiropractors' education and training, there is no doubt that Colossus discriminates against chiropractors. Their opinions and medical documentation is given less weight than that of a neurosurgeon, or orthopedic, for example.

What you can do about Allstate and Colossus

  • Your personal injury attorney can make a big difference. Colossus is designed to consider the attorney of record for the victim. If the attorney files lawsuits frequently against Allstate and refuses to settle for low money, then Colossus will increase the offers for that particular attorney. Before hiring your car accident attorney, ask him or her how many times he or she files suit, in particular, against Allstate. I file suit on roughly 50% of Allstate cases because I refuse to talk my clients into a low settlement to avoid the work of a lawsuit;
  • See a specialist or other medical professional. Because Allstate discriminates against chiropractors, it may be helpful to have your condition evaluated by additional medical professionals, such as your primary care physician, an orthopedic surgeon, etc. Even a trip to the emergency room at the beginning of the case may increase the value. In other words, personal injury claims with ONLY chiropractic treatment are ensured the lowest possible offer from Colossus.
  • Don't delay in treatment. If you were injured, seek medical help. Even if you feel the pain may go away in a couple of days, it is important to seek help quickly. Your pain may persist for several months, but if you wait too long for the initial doctor's visit, it may negatively affect the value of your claim.

Don't allow Allstate or insurance companies that use similar software to undervalue your claim. You deserve fair compensation for your injury claim and that starts by hiring the right personal injury attorney.

June 6, 2012

Rhode Island Bill Concerning Auto Body Repairs Getting a Lot of Attention

Geico recently sent out a mass email to clients, and anyone else willing to listen, discussing the proposed bill in Rhode Island regarding compensation to auto body shops and fair settlement of property damage claims. Of course the insurance companies are using fear tactics informing everyone that rates may skyrocket with passage of this bill. I want to take this opportunity to offer a fair assessment of this bill, its purpose and the reasoning behind it. Trust me, I am not going to shed any tears for Geico, who I have previously described as one of the most difficult insurance companies to deal with, but I ultimately believe this bill is not going to pass as written even though it has a lot of strong points. Maybe I'll be proven wrong...

If you're involved in an auto accident, you may have a personal injury claim, but you will almost certainly have a claim for property damage. Property damage resolution is a major part of any motor vehicle accident claim and that is why my office helps clients with their damage claim for free if I represent them for their bodily injury claim. Insurance companies will fight for every penny on a property damage claim, cutting short rentals and lowering the value of your vehicle if a total loss. The purpose of this bill is to limit some of the tactics that insurance companies use to de-value property damage claims.

The bill puts into law many regulations that the Department of Business Regulations has already established for settlement of property damage claims. For instance, insurance companies are supposed to use NADA (or something similar) for the valuation of total losses. Insurance companies are also forbidden from trying to steer vehicle owners to a particular body shop. Almost all auto insurers, especially the larger ones, have partnerships with certain body shops in the State. Insurance companies try to direct customers to these body shops with the understanding that the auto body will be reasonable in negotiating the estimate and will work at agreed labor rates. This bill, if passed, will forbid insurance companies from steering vehicle owners to a particular body shop if the owner has already chosen their shop of choice. Of course, it has always been established that a person ultimately has the right to choose what shop they repair their vehicle at.

The most controversial part of the law, and the reason why ultimately, I believe it will not pass, concerns the obligation of the insurance company to negotiate the full amount of the vehicle estimate in good faith with the body shop. The reason this is a big deal is because insurance companies have capped body shops at certain dollar amounts for labor, paint, mechanical repairs, etc. If this bill passes, those caps will be destroyed and insurance adjusters will have to negotiate labor and painting rates as well as what repairs are necessary. If the insurance company does not comply then the auto body shop can file a lawsuit against the insurance company without the need of including the vehicle owner in the lawsuit. The problem with this bill, in my humble opinion, is that it is too harsh on the insurance companies. If they can not come to an agreed price with the body shop there is no alternative available for the insurance company except litigation. They are not allowed to withhold payment or ask the vehicle owner to repair the car elsewhere. Without any option available to them, insurance companies are going to be held to the fire by body shops or else face a lawsuit. I think another alternative will need to be included in the bill before passage.

It takes a lot for me to feel any sympathy for insurance companies and I would like to see this bill pass as it has a lot of merits, although increased insurance rates are likely to occur.