A car insurance lawsuit can occur. If you are in an accident that causes injury to another, you may find the other driver filing a lawsuit against you. This can be freighting and overwhelming. However, your auto insurance policy may provide some of the support you need. In most cases, the insurer handles the process for you. Here is what you may be able to expect.
Why Car Insurance Lawsuits Can Happen
It is not uncommon for a party to file a lawsuit against you and your insurance company after an accident. For example, if you cause an accident, the other party submits information about their losses to your liability insurer. Your insurance company may pay some of their costs. They may elect to negotiate the value. Or, they may simply not issue a payment if they refute the charges.
In states that are no-fault, a lawsuit can occur if there are serious losses involved in the accident. In this situation, the individual has to prove they suffered significantly due to your actions or inaction.
What Happens When They Do
Your auto insurance company represents you in this process. It is their goal to ensure payment occurs when fair, but that they do not overpay for losses.
Most often, the insurance company's adjusters work with the other party. They try to negotiate a settlement. If this does not happen, the other party may decide to file a claim in a court of law. In most cases, it does not get to this point. Settlements happen first.
If it does go to court, you may not need to be present. In some cases, you do, but you will usually have legal representation provided by your insurance company. The attorney represents you and the insurance company in the lawsuit. And, if the court awards a settlement or judgment, the insurance company pays it.
Keep in mind that all policies have limits. You have coverage in this way up to the amount of coverage listed on your auto insurance contract. This is one key reason why it is so important to have high-value liability insurance in place on your plan.
Your car insurance company works with you throughout the legal process. Be sure to follow their instructions on how to handle what occurs. Most companies stay in touch with you throughout the process. This keeps you informed of what is happening. Be sure to provide them with all the information you have in the case, too.