Were you in a car accident and now your being sued for a lot of money?

by admin on November 6, 2010

Accidents are called accidents because they are just that; accidents.  Otherwise they would be called “on purposes”.  The accident might be your fault in the eyes of the law but you certainly did not mean to do it.   But now that you have caused an accident and you have been sued for what seems like an incredibly large amount of money, what do you do?

This discussion is on the assumption that you have a valid policy of automobile insurance in place at the time of the accident.  If you did not have a valid policy of insurance in place at the time of the accident, you could very well be in some significant financial trouble.  However, that is not our discussion today.

On the assumption that you have a valid policy of insurance in place at the time of the accident, you will have what is referred to as a “policy limit”.  The minimum policy limit in Ontario is $200,000.00.  There is no real maximum but experience tells me that most people have a $1,000,000.00 policy of insurance.

Let’s start with the Statement of Claim.  A Statement of Claim is a claim for money, the amount of which the lawyer issuing the claim can and does literally make up.  The lawyer was likely taught in law school that you don’t want to claim for less money than your client’s claim could be worth.  Since it is often difficult to tell what the file is ultimately worth, the lawyer often over-claims and works backwards from there.

If you have caused an accident, the amount of damages that were incurred by one or more other people in the other vehicle or in your vehicle (depending on how the accident happened) has an incredible amount of range.  If you injure a 35 year old brain surgeon that makes $1,000,000.00 per year, the damages could be monstrous.  If you caused an accident but nobody was really hurt then the damages could be nominal or even non-existent.

If you were in an accident and you are now being sued, you must immediately send a copy of that Statement of Claim to your insurance company.  I recommend that you send it to the company and not to the broker and I recommend that you keep some type of proof that you sent it.  Do not delay.  Send it immediately upon getting it.  There are certain timelines that may need to be followed.  Usually it will say that you have 20 days to file a Defence.  Your policy of insurance requires your insurance company to hire its own lawyer to file that Defence.  In short, that part of it is your insurance company’s problem and not yours.

However, you should keep yourself informed as to the potential damages suffered or sustained by the plaintiffs (the person or people named at the top of the Statement of Claim).  Your insurance company, any adjusters and well as any lawyers that they hire have to keep you posted.  They might pretend that they don’t have to keep you posted but they do.  If you have been sued for more than your policy limits, you are entitled to know how real a possibility it is that the claim goes over your policy limits.

Why should you worry?  Let’s take for example that you have the statutory minimum of $200,000.00 as a policy limit.  If your insurance company does not or cannot settle the file for $200,000.00 in damages or less, presumably it goes to a trial.  If it goes to a trial, a judge and/or a jury can award almost any amount of money.  If for example the judge and/or jury award $400,000.00 in damages to the person that you injured in the car accident, your insurance company is only obligated to pay the first $200,000.00.  You will be personally on the hook for the rest of the money.

As long as your insurance company settles the file for less than your policy limits, it really has no affect on you.  However, in the example where you only have a $200,000.00 policy limit, it is not very difficult to get a case worth more than $200,000.00.  In that instance, you should insist that your insurance company settle the file for anything equal to or below your policy limits.  You should send it to them in writing.  You should keep a record of it.  If you send a fax, keep a copy of the fax confirmation sheet.  E-mail is another great way to instruct your insurance company and/or their lawyers to settle for your policy limits or less.

They might even tell you that it’s none of your business or it has nothing to do with you or that it is not your decision.  If there is a risk that the plaintiff’s case goes over your policy limits, it is absolutely and 100% something that you should have a say in.

Remember, any award by a judge or a jury that is more than your policy limits comes out of your pocket.  Leave a very clear paper trail to your insurance company and/or their lawyer that you demand that the file be settled for equal to or less than your policy limits but that under no circumstance are they to go to trial and gamble with what amounts to your money.  If the jury gives the plaintiff less money than the policy limits, none of that money comes back to you.  The insurance company simply gets to save that money.  However, if the jury gives more money than your policy limits,  that DOES come directly from you.  It could ruin you financially.  It could devastate your family.

Insist that your insurance company settle with the plaintiff for an amount of money equal to or less than the policy limits.



About the Author:
Reybroek Barristers – About the Author:Todd A. Reybroek, LL.B.
Todd A. Reybroek is the founder of the law practice that bears his name. Todd began his career representing insurance companies involved in personal injury cases, but now works exclusively with individuals who have been hurt or injured in accidents.
Todd’s experience dealing with both insurance companies and private individuals is invaluable, and enables him to understand the complexities involved in personal injury cases.
“I love the practice of law and being able to use my legal education to help people, “states Todd. “Personal Injury law is very hands-on, and relies on establishing a trusting relationship with clients.
Everyone who works at my practice works to put our clients first, and we earn their trust every day.”
Reybroek Barristers 3200 Dufferin Street, Suite 210 Toronto, Ontario, Canada M6A 3B2 Toll Free: 866-357-2409 Local: 416-780-1413 Fax: 416-780-1436Map & Directions
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