If you make a mistake and cause a Car Accident that injures someone, then your Car Insurance Company has two responsibilities: Defense and Indemnity.
Car Insurance Duty to Defend
The first duty that your Car Insurance Company has is to take over defending you from any claims.
Before a Lawsuit is filed in Court, your Car Insurance Company will assign one or more adjusters to investigate your accident and value and negotiate claims.
If a Lawsuit gets filed against you, then your Car Insurance Company must pay to hire a lawyer to defend the Lawsuit.
Car Insurance Duty of Indemnity
In addition to providing you with a defense regarding any claims arising out of the accident, your Car Insurance Company also has a duty to pay fair compensation to the victim to make up for injuries and damages, but only up to the amount of Liability Coverage that you purchased.
In Pennsylvania you pay for two types of Liability Coverage, Property Damage and Bodily Injury. Property Damage pays for damages to other vehicles or things and Bodily Injury pays for injuries to people.
In Pennsylvania, drivers are required to carry at least $5,000 in Property Damage coverage and Bodily Injury coverage of at least $15,000 per person/$30,000 per accident, but you can (and should) choose to purchase much higher amounts.
If you cause a Car Accident, then your Car Insurance Company must negotiate in Good Faith with the injured person and pay fair compensation for Property Damage and Injuries up to the amount of coverage. If the claims are worth in excess of the coverage, then you may face claims against your personal assets.
If you feel that your Car Insurance Company is not negotiating in Good Faith with the victim, you can tell the attorney or adjuster or you can hire your own lawyer to protect your assets.
Ultimately, if your insurance company fails to settle the claims against you within your policy limits and the trial results in a verdict in excess of your coverage, then you may have a Bad Faith claim against your insurance company to force it to pay the excess verdict and other damages.
You can learn more about Car Insurance issues by downloading my Free Book – Protecting Your Family From Accidents or contact me at email@example.com or 610-840-0124. Check out my website at www.TimRayneLaw.com.