THURSDAY, MAY 27, 2021
When you are involved in a car accident, your first thought is to make sure everyone is uninjured. After medical attention is received, there are other concerns that will catch your attention—such as filing a claim and a possible lawsuit.
Why Car Insurance Lawsuits Happen
It is not uncommon for a party to file a lawsuit against you and your insurance company after an accident. For example, if you cause an accident, the other party submits information about their losses to your liability insurer. Your insurance company may pay some of their costs. They may elect to negotiate the value. Or they may simply not issue a payment if they refute the charges.
In states that are no-fault, a lawsuit can occur if there are serious losses involved in the accident. In this situation, the individual has to prove they suffered significantly due to your actions or inaction. 
What Happens When They Do?
Your auto insurance company represents you in this process. It is their goal to ensure payment occurs when fair, but that they do not overpay for losses.
Most often, the insurance company’s adjusters work with the other party. They try to negotiate a settlement. If this does not happen, the other party may decide to file a claim in a court of law. In most cases, it does not get to this point. Settlements happen first.
If it does go to court, you may not need to be present. In some cases, you do, but you will usually have legal representation provided by your insurance company. The attorney represents you and the insurance company in the lawsuit. And, if the court awards a settlement or judgment, the insurance company pays it.
Keep in mind that all policies have limits. You have coverage in this way up to the amount of coverage listed on your auto insurance contract. This is one key reason why it is so important to have high-value liability insurance in place on your plan.
Call Your Insurance Agent
After everyone is safe and taken care of, call your insurance agent to discuss the accident. Even if you don’t plan on filing a claim, it is important to keep your insurance agent up to date in case of a future lawsuit or claim.
Don’t contact the party suing you while the lawsuit is occurring. Any contact outside of the legal circumstances can be used against you.
When in doubt, seek legal counsel and speak with your insurance agent about your options.
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