The recent car accident case of GEICO v. Insurer before a Florida appellate court may not have any direct bearing on plaintiffs here in North Carolina, but the issues raised are highly relevant.
The case involves an 83-year-old driver with minimal insurance who was legally blind when he injured two pedestrians and then later lied about it under oath prior to trial. The man’s doctors had told him he shouldn’t be driving, and he concealed this fact as well.
The plaintiffs later sued when, after receiving the full $20,000 policy limit, the insurance company refused to pay anything more toward mounting medical expenses. The question became whether the insurance company should have to pay sanctions imposed by the court against the driver/defendant for the falsehoods he provided under oath. Per the state’s laws on civil claims administrations, the insurer only had 30 days in which to issue a reservation of rights, asserting coverage might be withheld due to defendant’s misrepresentations. Instead, the company waited nearly a year to do so, by which point the insured had died (of unrelated causes) and the hearing against his estate was slated for just days later.
Our Greensboro car accident attorneys understand the injured plaintiffs were granted leave to seek punitive damages (reserved for cases in which the at-fault party displayed reckless disregard for the safety and well-being of others). The court also imposed a $27,000 fine for costs and attorneys’ fees. The insurer argued it shouldn’t have to pay because the insured lied under oath about his condition, which was a violation of the terms of his policy.
However, Florida’s Third District Court of Appeal ruled the insurer breached the state’s insurance laws by waiting so long to inform the estate it intended to deny coverage, and therefore, the reservation of rights was void. And while a violation of this law wouldn’t create coverage where none existed, the man’s false statements didn’t void his policy because they weren’t offered after a covered crash, as opposed to a precursor to coverage.
While the insurer will have to pay the $27,000 in sanctions, it still remains to be seen whether the company will have to cover the $750,000 consent agreement later reached by the plaintiffs and the estate. The estate, which was represented by its own personal attorney following a dispute with the one provided by the insurer, was found by the court to have no duty of cooperation to the insurer after the issuance of the reservation of rights letter.
This driver was in two high-risk categories that our crash attorneys often encounter in court: elderly and underinsured. The AARP reports the risk of a crash raises sharply once a driver passes the age of 70, as hearing, vision, physical ability and cognitive function decline. That this particular driver had been told by doctors he could not drive and yet did so anyway is indicative of reckless disregard for the lives of others. This is grounds for punitive damages, which are intended to punish the defendant, rather than solely make the injured whole, which is the goal of compensatory damages.
Drivers without enough insurance are also a serious problem. North Carolina drivers are required to carry a minimum of $30,000 for bodily injury for each person ($60,000 per occurrence). This is often not near enough to cover all expenses and damages to injured parties after a crash. Victims in these situations may have the option to either sue the at-fault driver personally or to file an uninsured/underinsured motorist claim through their own insurance company.
No matter what the situation, you can bet the insurer will work hard to fight your claim. They will undoubtedly be represented by an attorney. You should be as well.
Contact the North Carolina pedestrian injury lawyers at the Lee Law Offices by calling 800-887-1965.
GEICO v. Rodriguez, Sept. 10, 2014, Florida’s Third District Court of Appeal
More Blog Entries:
11th Circuit: No Coverage, Duty to Indemnify for Intentional Tort Behind the Wheel, Sept. 10, 2014, Greensboro Car Accident Lawyer Blog