How Washington Laws Protect Policy Holders from being Shortchanged by Insurance Companies
Before being injured in an automobile collision Janet was an active grandmother who enjoyed visiting grandchildren, cooking for family and friends, gardening, and traveling. She was just entering an intersection, on a green light, when a careless oncoming driver turned left directly in front of her resulting in a nearly head-on collision. Her airbags deployed and hit her with such force that her sternum (the “breastbone” where one’s ribs connect at the center of the chest) broke. Janet’s left knee hit the dashboard and was bruised. It took several weeks for her sternum fracture to heal and her left knee pain continued on and only got worse with time. Janet had knee problems before the wreck, but now her things were much worse. Janet’s medical bills alone reached $25,000.
Janet hired Mr. Duce to help her present a claim to the insurance company of the driver who caused this wreck. Unfortunately the young, 24-year-old, driver only had $50,000 in available auto insurance with Progressive Insurance. He had no money himself to pay for the damages his carelessness caused Janet. Mr. Duce arranged for Janet to receive that $50,000 policy limit payment.
Mr. Duce the requested that Janet’s own insurance company, coincidentally Janet was also insured by Progressive, make up the difference in what her case was worth versus the insurance amount available from the other driver. Progressive responded by saying they would not pay anything more because even though Janet thought she had full coverage, she did not have “Underinsured Motorist Coverage”. In the state of Washington insurance companies are required to offer their customers Underinsured Motorist Coverage (UIM) because this is the only way a person can protect themselves if they are injured in an accident where the other driver does not have enough insurance to make things right.
Because this UIM insurance is very important in cases like this one, the law of our state requires that insurance companies to carefully explaining this coverage to their customers and if the customer choses not to buy the insurance the company they must have the customer sign a written rejection or the insurance company must give the person UIM coverage. The also law requires car insurance companies to explain Personal Injury Protection (PIP) insurance the same way and get a written waiver from anyone who does not want that protection. PIP insurance pays for medical bills, lost wages, and needed household help necessary as a result of a car wreck up to certain dollar limits. Janet had PIP coverage on her policy which had paid $10,000 toward her medical bills, but no one explained the purpose of UIM coverage to her and she did not sign a waiver of that coverage. Now she needed it. At the insistence of Mr. Duce Progressive Insurance conceded that they because they did not have Janet sign a written waiver for UIM coverage they would have to provide that coverage. Progressive offered to pay $25,000 in Underinsured Motorist Benefits ($25,000 is the minimum amount of UIM Coverage allowed to be offered in the state of Washington). Mr. Duce was not impressed with this offer and insisted that Progressive Insurance pay more than the minimum for this woman who would have likely bought more coverage than that if she was told about its importance by her agent when she got her insurance policy to begin with. When Progressive Insurance refused to pay more than $25,000, Mr. Duce filed a complaint with the Insurance Commissioner on Janet’s behalf and invoked the “Insurance Fair Conduct Act”. Under this law an insurance company must carefully review claims that they have denied and either pay them or explain a legal basis for denying them within 20 days or face a lawsuit. Progressive did not respond to Mr. Duce’s complaint within 20 days so he filed a lawsuit against Progressive for Janet.
The lawsuit got Progressive’s attention and it settle to pay Janet an additional $55,000 for her knee injury, $3,400 toward Janet’s attorney fees, and an additional $5,000 for making her file a lawsuit to get what should have been paid originally.
Mr. Duce recommends that all drivers obtain both PIP and UIM insurance along with liability insurance when they sign up for car insurance. In circumstances where people are told they do not have the insurance coverage they thought they did Mr. Duce will aggressively investigate and make sure accident victims are not being short changed by insurance companies.