Is it possible to get more than the limits of insurance on a personal injury case?

Limits of insurance can be a big obstacle to full recovery. Is it possible to get more than the limits of insurance on a personal injury case? Unfortunately, California only requires that drivers carry a minimum of $15,000 per injured party and $30,000 per accident claim for liability coverage. Even when drivers carry above this limit of insurance, there are still numerous instances when an injured party has sustained medical expenses and pain and suffering that far exceed the potential policy limit.

Is it possible to get a California insurance company to pay more than their insurance limit?

The answer is yes but, it requires that the aggrieved party demand payment of the policy limit that meets five criteria as follows:

1. The demand must be made in clear and unequivocal terms. Coe v. SF Insurance;
2. All persons making a claim for damages must join in the settlement demand;
3. All insureds (persons against whom the claims are being made and for whom the policy was issued) must be released from liability. Strauss v. Farmers Insurance Exchange.
4. The amount demanded for settlement must be for the total policy limits and “reasonable” given the facts of the case (i.e. liability and damages). Heredia v. Farmers Insurance Exchange.
5. The insurance company must be given a reasonable amount of time and enough information to evaluate the claim. Crisci v. Security Insurance Company.

If these elements are met, a proper demand has been made. If the insurance carrier chooses to reject the limits demand and a verdict is later rendered by a jury that exceeds the policy limit, the insurance company is faced with either: (a) paying the excess; or (b) exposing themselves to a claim for “bad faith” by the insured.

What is the most likely scenario if a judgment is obtained in excess of the maximum insurance coverage?

The most likely option that the insurance carrier will choose will be to simply pay the judgment rather than risking potential for punitive (damages meant to punish) them by their insured. This creates a great incentive on their part to seriously consider accepting policy limits settlements demands. It also allows the plaintiff (injured person) to have a way to potentially collect damages in excess of the limits.

Attorneys should, obviously, do some “due diligence” prior to making a demand like this to determine: (1) confirmation of the actual limits (usually done by obtaining a copy of the policy or at least the “declarations of coverage”); and (2) confirm that the insured does not have any appreciable assets which could be collected upon above the insurance limits. However, assuming this has been done, a policy limits demand is a good way to put pressure on the insurance company to pay in full for legitimate claims.