Insurance Settlements - Personal Injury Claims
According to an old cliché, "if both sides are disappointed, an insurance settlement is probably fair."
But this statement is not true. Insurance companies almost always complain about settlements and verdicts.
If a verdict exceeds an insurance settlement offer, they say the verdict is excessive. If a verdict is less
than an insurance settlement offer, they say the verdict proves that policy holders demand too much. Either
way, they complain, as if paying any claim under a policy is unfair.
In order for an insurance settlement to become fair, the settlement must include an assessment of all
items of damage required by the policy. After all, the policy holder has done their part - paid all premiums
requested - and the only remaining obligation is owed by the insurance carrier according to the terms of the
policy.
Conflict of interest in insurance settlements
Compare the duty of lawyers and insurance companies to their clients. When lawyers accept payment, they
owe each client an affirmative duty to represent only the client's best interest. When insurance companies
accept payment, they are permitted to argue against their client's best interest. The attorney/client
relationship creates a fiduciary duty which requires loyalty while the insured/carrier relationship does
not. In practice, when an insurance settlement is declined, insurance companies consider a policy holders
as a potential plaintiff in an adversarial posture.
Fore further information, see:
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