Motorcycles, Passenger claims and Red Lights

 

Daytona Bike Week is just around the corner.  Here is some more timely and hopefully helpful info for passengers during bike week.

When  a passenger on a motorcycle is injured, usually in a left turn type accident,  he has two possible claims: one is against the driver/operator of the motorcycle and the other is against the other driver who turned in front of the oncoming motorcycle.  These types of accidents frequently occur at a traffic light when the motorcycle is in the outside lane, and is obscured by other vehicles from view by the turning driver . 

If  it is a one vehicle crash,  then the passenger has a claim against the driver.  There was a tragic story about a woman who was left for dead on the road by a motorcycle driver.  Her estate would have a claim against him. The driver was sent to prison for five years.

The classic example of this type of accident is discussed in Zimmerman v  Langlais.  There, the minor passenger on a motorcycle was injured when the motorcycle he was a passenger on was going 50 mph in the outside lane and went through a "yellow" light at an intersection.  The accident happened at night.  The car driver was waiting under the light  to turn left and could not see the oncoming motorcycle because it was obscured by cars in the inside lane.  The car driver turned left into the motorcycle when the light turned red.  The jury found the left turning driver not at fault.

The Zimmerman case is a good example of the rule that evidence of a traffic violation (running a red light) is only evidence of negligence, not negligence "per se."  So,  jury could exonerate the left turning driver  even though she ran a light and caused injuries As so often happens in  left turn cases, the entire blame was placed on the motorcyclist by the jury.

Insurance companies know these types of accident often happen.  They sometimes exclude any claims by passengers against the driver/operator and/or the insurance company.  The exclusion is not against the public policy and is therefor legitimate under Florida law.Yakelwicz v. Barnes.

My recommendation: ride with a safe driver who has plenty of insurance.  If he has none, be sure to get uninsured motorists coverage.  It protects you if your driver has none and is at fault.  I discussed these issues in my previous blogs here and here.

 

The "I" word: Insurance and Jury Trials

 

I recently wrote a blog about the “T” word: Tickets, here. Today’s blog is about another word lawyers cannot use in front of the jury: Insurance. More specifically, that the defendant has Insurance. There is no automatic mistrial, but the courts often grant one. See Hollenbeck v Hooks.

All injury and death cases start by filing a lawsuit against a defendant. The lawyer names the defendant, but the defendant’s insurance company is never joined in the suit. Why not? When the Judge starts a trial he asks the jury have your heard of this case: and then he names the parties. For example:  "This is the case of Robert Smith vs Sam Jones and Allstate Insurance Company." By naming an Insurance company the Jurors knew Sam Jones had insurance.  The insurance companies were convinced in 1976 that verdicts were inflated when Jurors knew there was insurance so the insurance industry lobbied  the Florida legislature to make some changes. 

Ever since 1976 in Florida a lawyer cannot join the defendant’s insurance company. The result: jurors are not aware that a powerful insurance company is sitting in the room controlling the defense all the way from jury selection to final verdict, including the most important choice of all: whether to settle or not. So if you are called for jury duty, be aware of this information. Very few defendants have assets so in almost every Tort case, you can be sure there is insurance behind the defendant. A plaintiffs attorney will not take a case unless he can collect his fees and costs.

Thus the “I” word: Insurance cannot be mentioned in the presence of the Jury or it will likely result in a mistrial, and the case has to be started over again without a “tainted” jury.

Historically there was a period of time when lawyers sued the defendant and combined his insurance company. This was called “joinder.” In 1976 the Florida legislature enacted the non-joinder statute. Ever since then an insurance company cannot be sued as a co-defendant. FS 627.4136. Even though the insurance company is not a party, the legislature granted insurance carriers the unique right to recover court costs just as thought they were parties. FS 627.4136(2). And, even though carriers control all aspects of the defense, they do not have liability under the offer of judgment statute for a large verdict, which could have been avoided. In other words, carriers get their cake and can eat it too.   This results in two sets of rules, one for insurance companies and one for all others, and guess who wins?  The insurance companies, of course.  Here is what one Florida appellate court said about this heads we win, tails you lose situation:

The inequity is that when a plaintiff, such as Barnes, makes a successful offer of judgment, its recovery of attorney's fees is limited to the defendant. The insurance carrier thus suffers no risk as to the award of attorney's fees.This imbalance has been the comment of at least one appellate court judge, but nothing has changed.

In years past, plaintiffs had opposed having to pay the nonparty insurance carrier's costs under the offer of judgment statute. In holding the payment of costs advanced by one other than the named party to be appropriate, the Florida Supreme Court stated: “Failure to allow a cost award to a prevailing defendant who is insured, because of the fact of insurance coverage alone, gives the plaintiff and/or the plaintiff's insurance carrier, an undeserved windfall.” Aspen v. Bayless, 564 So.2d 1081, 1082, 1083 (Fla.1990).

 That was almost 40 years ago, and the Florida legislature has not addressed the inequity yet.  The legislators should be ashamed of themselves.


 

Can the Insurance company Cancel me?

 

Cancellation of an insurance policy is serious business.  It makes it much harder to get new coverage.  Increasing premiums just because of a single claim is also serious.  Both cancellations/nonrenewals and premium increases are governed by Florida laws.

FS 626.9541 contains a list of unfair claims practices which includes:

3 a. Imposing or requesting an additional premium for a policy of motor vehicle liability, personal injury protection, medical payment, or collision insurance or any combination thereof or refusing to renew the policy solely because the insured was involved in a motor vehicle accident unless the insurer's file contains information from which the insurer in good faith determines that the insured was substantially at fault in the accident.

b. An insurer which imposes and collects such a surcharge or which refuses to renew such policy shall, in conjunction with the notice of premium due or notice of nonrenewal, notify the named insured that he or she is entitled to reimbursement of such amount or renewal of the policy under the conditions listed below and will subsequently reimburse him or her or renew the policy, if the named insured demonstrates that the operator involved in the accident was:

(I) Lawfully parked;

(II) Reimbursed by, or on behalf of, a person responsible for the accident or has a judgment against such person;

(III) Struck in the rear by another vehicle headed in the same direction and was not convicted of a moving traffic violation in connection with the accident;

(IV) Hit by a “hit-and-run” driver, if the accident was reported to the proper authorities within 24 hours after discovering the accident;

(V) Not convicted of a moving traffic violation in connection with the accident, but the operator of the other automobile involved in such accident was convicted of a moving traffic violation;

(VI) Finally adjudicated not to be liable by a court of competent jurisdiction;

(VII) In receipt of a traffic citation which was dismissed or nolle prossed; or

(VIII) Not at fault as evidenced by a written statement from the insured establishing facts demonstrating lack of fault which are not rebutted by information in the insurer's file from which the insurer in good faith determines that the insured was substantially at fault.

c. In addition to the other provisions of this subparagraph, an insurer may not fail to renew a policy if the insured has had only one accident in which he or she was at fault within the current 3-year period. However, an insurer may nonrenew a policy for reasons other than accidents in accordance with s. 627.728. This subparagraph does not prohibit nonrenewal of a policy under which the insured has had three or more accidents, regardless of fault, during the most recent 3-year period.

Thus, the insured has major league protections against an insurance company which tries to cancel or non-renew, or which increases its premiums after an accident which the insured was an innocent party to.  Violations like these open the insurance company up to possible punitve damages and attorneys fees.

 

Motorcycles and The Knowledge Gap

Daytona Bike week is around the corner.  Its an exciting time for bikers coming into the area.  Most will leave with great memories.  Experience tells us some will leave with most of their body parts, and some will not leave at all.  Some will lose friends and have damages to their motorcycles.  NHTSA estimates the chances of a fatality on a motorcycle are 30 times higher than in a car.  I recall one biker who had suffered a traumatic castration.  You should have seen the look on his face when he learned there was only $10,000 of insurance.

Out of curiosity I called a Florida agent who offers biker insurance through six major carriers.  Based on what she said, I think there is a knowledge gap about UM (Uninsured or underinsured motorists) coverage.   This whole area of UM and rejections was discussed in another Blog.

Here are some of the highlights of what I found out:

  • The agent could not explain the legal differences between UM and HMO/Group coverage
  • Bikers think they can skip getting UM when they have a major medical  or HMO policy to cover their medical bills

If the agent doesn't know,  how is a Biker supposed to make an informed decision to buy the UM or not?


Continue Reading...

UM Coverage: Found Money?

 

Last week I posted a blog about Leaving Money on the Table.  Today, I am discussing something much more exciting and equally as interesting:  finding extra insurance money.  The starting point again is Uninsured Motorists coverage, also known as under-insured motorists coverage.  Uninsured motorist coverage is like standby insurance in case you, a family member or someone in your car gets hurt by a driver with no insurance, or not enough insurance.

In today's tough economy lots of people are driving bare, with no insurance. Driving without the mandatory insurance can result in a suspension of a driver's license.  Continuing to drive after suspension of driving privileges can land a driver in jail. Letting someone drive who has a suspended license may result in the seizure and forfeiture of the vehicle under the Florida Contraband and Forfeiture Act. So, people who need their cars should think twice before doing a favor by letting a suspended driver use it.

I can't tell you how many times a client has come in and says he thought he had "full coverage." It often turns out he has the bare bones minimum policy.  When I hear this I make it a point to carefully question him about how his policy was issued.   In Florida all that is required is $10,000 in property damages and personal injury protection (PIP).  Liability and UM are not mandatory.

UM insurance is bought either by the company you work for or from your own insurance company.  It is intended to protect you if someone hits you without any or enough insurance. If you were injured while driving a company vehicle by another driver who was uninsured or underinsured you should check with your company to see if it ever signed a written rejection of UM coverage.

Whenever a new liabilty insurance policy is issued a written rejection or election about UM must be made. Florida auto insurance law has changed this simple rule into a complex legal maze.  The insured must decide:

  • Do I want any uninsured motorists coverage? (Y/N) If NO, a Rejection is signed. The insurance company is off the hook if it gets this decision in writing.
  • If Yes, do I want to buy UM coverage for the same amount as my liability coverage or some lesser amount?
  • Do I want to stack my UM coverage?

The statute is FS 627.727(1) which in part reads:

"(1)  No motor vehicle liability insurance policy which provides bodily injury liability coverage shall be delivered or issued for delivery in this state with respect to any specifically insured or identified motor vehicle registered or principally garaged in this state unless uninsured motor vehicle coverage is provided therein or supplemental thereto for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, resulting therefrom. However, the coverage required under this section is not applicable when, or to the extent that, an insured named in the policy makes a written rejection of the coverage on behalf of all insureds under the policy..."

The statute goes on to allow only the lessee decided whether to accept or reject UM coverage if a car is rented for more than one year.

So what does this legal mumbo jumbo mean?  Well, if your own insurance company does not have a written rejection in its file from you,  (or your employer) then it is on the hook for any damages the uninsured driver caused you.  It is as if your own insurance company gave you extra insurance for free.  It cannot bill you for the UM coverage after the claim as a condition to providing it to you.  That was the exact holding in Mercury Insurance Company v Anatkov, 929 So.2d 624 (Fla. 3rd DCA 2006).  Better yet, once the insurance company denies you UM benefits, it is required to pick up the tab for your attorneys fees too!  And if your employer  did not sign off on getting UM coverage, you can make a claim for UM benefits through your company's liability insurance company.  That was the holding in Travelers Ins. Co. v Quirk, 583 So. 2d 1026 (Fla. 1991).

Bottom line:  If there is no signed rejection of UM coverage, your own insurance may have to pay you uninsured motorists benefits.  In a case where serious injuries have occured, the rejection should always be checked.

UM Coverage: Leaving Money on the Table?

A young man I represented was involved in a horrific accident and lost a leg.  He was on his motorcycle and was run over from behind by a drunk driver.  Worse, the drunk driver was uninsured.  This was not surprising to me since In Florida about one in every four drivers are "uninsured."  Chances are good that if you are in an accident in Florida an uninsured motorist will be at fault.  They are the biggest road hazards going.    What was surprising was that the young man's father, with whom he lived, had paid for $100,000 in UM insurance but would not let his son make a claim for uninsured motorists benefits.

Why wouldn't he let his son make a claim?

  • His father's reasoning showed a lack of understanding of the nature of UM insurance and how insurance companies set their rates.   
  • Basically, every insurance company decides to takes certain risks based on statistics. 
  • They know what percentage of drivers on the roads are uninsured, and of that group statistically how many of them will have a wreck. 
  • They do some sophisticated math and calculate their premiums, figuring how much they need to charge to cover all of their expenses and their losses, and still make a profit. This part of the insurance business is done behind the scenes and is called underwriting.  
  •  When they issue a new insurance  policy they build their profit and expenses into the  premium.   They collect enough from a large pool of people to be able to pay off the losses on a few and still turn a profit.
  • They decide that they will make enough money on those drivers who are NOT in accidents with uninsured motorists to cover any losses they will sustain on their  own insured drivers who do make claims.

So in this case, the father had paid for insurance and would not let his son make a claim.  To me that was like not making a claim for insurance if your house burns down.  There must be something else going on so I decided to investigate further.  The father was of the mind that it was improper to make a claim when he personally did nothing wrong, even though his son was injured by an uninsured driver.  The father thought of this as a "frivolous claim" and the uninsured motorist should pay, not his UM company.  This mental hurdle was too big and the father never let his son make the claim.  I said, "Who needs the money more, your son or Prudential Insurance?" He had never made a claim in over 49 years and did not want to blemish his perfect record.  (It's as if we have the strange idea that we owe premiums to insurance companies, but they don't owe anything back.)

Turns out the father was afraid his own insurance premiums would go up, or he might get cancelled or they might not renew if he allowed his son to make a claim.  I suggested that the father call his own insurance agent and ask whether, based on this one claim, they would cancel his own insurance or increase his premiums for the same coverage. He still refused to budge.  Gosh, if he wasn't going to allow his son to make a claim I could not imagine any circumstances when he would make a claim for UM benefits. 

Cancellation of an insurance policy is serious business.  It makes it much harder to get new coverage.  Increasing premiums just because of a single claim is also serious.  Both cancellations/nonrenewals and premium increases are goverened by Florida laws.

FS 626.9541 contains a list of unfair claims practices which includes:

3 a. Imposing or requesting an additional premium for a policy of motor vehicle liability, personal injury protection, medical payment, or collision insurance or any combination thereof or refusing to renew the policy solely because the insured was involved in a motor vehicle accident unless the insurer's file contains information from which the insurer in good faith determines that the insured was substantially at fault in the accident.

b. An insurer which imposes and collects such a surcharge or which refuses to renew such policy shall, in conjunction with the notice of premium due or notice of nonrenewal, notify the named insured that he or she is entitled to reimbursement of such amount or renewal of the policy under the conditions listed below and will subsequently reimburse him or her or renew the policy, if the named insured demonstrates that the operator involved in the accident was:

(I) Lawfully parked;

(II) Reimbursed by, or on behalf of, a person responsible for the accident or has a judgment against such person;

(III) Struck in the rear by another vehicle headed in the same direction and was not convicted of a moving traffic violation in connection with the accident;

(IV) Hit by a “hit-and-run” driver, if the accident was reported to the proper authorities within 24 hours after discovering the accident;

(V) Not convicted of a moving traffic violation in connection with the accident, but the operator of the other automobile involved in such accident was convicted of a moving traffic violation;

(VI) Finally adjudicated not to be liable by a court of competent jurisdiction;

(VII) In receipt of a traffic citation which was dismissed or nolle prossed; or

(VIII) Not at fault as evidenced by a written statement from the insured establishing facts demonstrating lack of fault which are not rebutted by information in the insurer's file from which the insurer in good faith determines that the insured was substantially at fault.

c. In addition to the other provisions of this subparagraph, an insurer may not fail to renew a policy if the insured has had only one accident in which he or she was at fault within the current 3-year period. However, an insurer may nonrenew a policy for reasons other than accidents in accordance with s. 627.728. This subparagraph does not prohibit nonrenewal of a policy under which the insured has had three or more accidents, regardless of fault, during the most recent 3-year period.

Thus, the insured has major league protections against an insurance company which tries to cancel or non-renew, or which increases its premiums after an accident which the insured was an innocent party to.  Violations like these open the insurance company up to possible punitve damages and attorneys fees.