What Does Liability Insurance Really Cover?

By January 26, 2010 Personal Injury

After an accident or loss, everyone tends to point fingers. And it doesn’t stop with you and the person who hits you, either. Your insurance companies may start pointing fingers, the police officer who refused to give either of you a citation may be pointing fingers, and your spouse or significant other may also start pointing fingers. But do you deserve all of this blame?

It may not matter who points fingers at you if you have had the foresight to invest in accident liability insurance. This is insurance that is specially earmarked for defending you and settling any claims or judgments that occur as a result of you having been negligent in an auto accident.

Usually, there are two different kinds of liability insurance in relation to an auto. You can have bodily injury liability coverage and property damage liability coverage. So, let’s take an example of how this may work.

Bear with me here, I always have my reasons: but let’s say that Batman is involved in an accident with another fictional character, it doesn’t matter who. If Batman is injured in this car accident with his bat mobile, and the other character is definitely at fault, then the other character will most likely have to reimburse our man. This is assuming that Gotham City is not within a jurisdiction that favors a modified no-fault law, or otherwise says that there are limits on the accident claim being presented.

Let’s assume, for the sake of fictional argument, that Batman ran a red light in the pursuit of fighting crime, and is considered the most at fault for the resulting losses. The character’s attorney will try to get their hands on Batman’s bodily injury liability coverage, because of the caped crusader’s negligence. The liability coverage is not health policy related coverage, nor is it utilized to pay for any medical bills that the character incurs. It would possibly pay the medical bills of any passengers of the character, if these persons did not have an attorney representing them. This is to keep the peace, and is done infrequently, so we won’t dwell on it here.

Back to our case with Batman and the character he hit with his bat mobile. When the lawsuit is filed, Batman’s name will most likely be listed alone on the court documents. This is because his attorney will not want anyone to know that he has this fine comprehensive coverage in the case of this type of loss. His attorney will not want a jury to understand that there is a “deep pocket” and that no, Batman himself isn’t paying for these damages, the big insurance company will pay for this loss in the end.

But, Batman’s liability carrier will hire its own competent attorney to add his opinion into the mix. If the jury believes the character, and gives a verdict in an amount higher than Batman’s policy, then, Batman will have to go into the bat cave and open the safe to come up with the difference. Maybe he will have to sell a Picasso, or maybe he will have to give up his fleet of private jets, it will be totally up to him, but something will be sold to satisfy the judgment against him if he loses. (Or else, he might have to declare bankruptcy, but this digression is outside of the bounds of this discussion.)

For this reason, it is to Batman’s advantage to settle this whole matter with the character out of court. Yes, this is a way to get damage control, and he can probably settle within the limits of the liability policy (read: this is all we have, just please take it as final settlement). So, in good faith, in an effort to preserve good will, Batman and his attorneys will settle with the character out of court.

The people described in this description are purely fictional. Our clients have no representative bearing on the example that you have just read. If you are serious about getting a capable attorney to manage your auto insurance claim after a car accident, call Ledger & Associates at 1-800-300-0001 or email us at www.ledgerlaw.com. We are ready to hear your story and we are interested in helping you discover options for recovering on your claim.