Uninsured Motorist

September 26, 2008

Colossus and Allstate

I received this email from a personal injury lawyer in Maryland this morning:

I have an MIA complaint involving Allstate offered the number provided by Colossus and now, of course, refuses to produce any Colossus manuals, etc. Do you have some useful Colossus materials?

I don’t. Maryland’s bad faith law is recent and it makes relevant lines of inquiry from Maryland accident lawyers that before would have been irrelevant including, as this email suggests, how Allstate values first-party uninsured or underinsured accident cases. If any lawyer out there has anything that might be of use that I could pass along, will you drop me an email?

August 7, 2008

New Bankruptcy Case Every Accident and Malpractice Lawyer Should Know

by Ronald V. Miller, Jr.

The 11th Circuit Court of Appeals decided whether a debtor’s claims for legal relief that arose after the confirmation but before the completion of his plan to pay creditors are property of the estate, under Chapter 13 of the Bankruptcy Code.

Here, after the debtors’ joint Chapter 13 plan was confirmed, the joint-debtor husband was involved in a car accident and suffered personal injuries. The bankruptcy court approved the $25,000 claim against the at-fault driver. Debtors then sought authority to settle the uninsured motorist claims arising out of the car accident without further approval from the bankruptcy court because the car accident happened after the confirmation, and the claims vested in the debtor and were not subject to the bankruptcy proceedings.

The court addressed two distinct issues: (1) whether the husband’s underinsured-motorist benefits are property of the estate, and (2) whether the bankruptcy court erred when it required both the husband and the wife to amend their schedules of assets to disclose the husband’s claim and partial settlement.

April 9, 2008

Allstate Relents and Produces Internal Claims Documents

by Ronald V. Miller, Jr.

Back in January, I wrote about Allstate’s ongoing war with the state of Florida (and Missouri) in which it arrogantly racked up more than $4 million in fines for refusing to turn over documents they received orders to produce and which the insurance commission requested in Florida. On Friday, Allstate not only produced 150,000 pages of responsive documents it had protected as proprietary, but it made the documents available on Allstate’s website.

In defending some documents, a company spokesperson said that many lawyers misinterpreted the documents that refer to how Allstate deals with claims from other parties, not from policyholders. The Allstate spokesperson said many of the documents, the plaintiff’s personal injury lawyers picked apart, refer to claims-handling practices for car accident claims that have been incorrectly assumed to apply to homeowners’ policies.

If this is true, I see Allstate’s point. Accident lawyers whine about Allstate’s poor offers in third party cases. In Maryland car accident cases, I don’t think GEICO, Progressive, Nationwide, MAIF, or State Farm are making offers that are any different from Allstate’s. But that is not my point. The insurance companies have no obligation in third party cases to make fair offers. Insurance companies can do whatever they want. Therefore, we have lawsuits.

February 14, 2007

CNN Report on Insurance Company Tactics

by Ronald V. Miller, Jr.

CNN reports on an 18-month investigation into minor-impact soft-tissue injury crashes around the country. The report confirms what auto accident lawyers in Baltimore and around the country have known for quite some time: the insurance companies defend these cases not based on the value of the cases, but to discourage auto accident lawyers and victims from bringing a claim.

Since the mid-1990s most of the major insurance companies – led by the two largest, Allstate and State Farm – have adopted a tough take-it-or-leave-it strategy when dealing with most auto accident cases. The result of this strategy has been billions of dollars in profits for insurance companies and little for the public, according to Jeff Stempel, a University of Nevada insurance law professor. Stempel further stated that “We can see that policyholders individually are getting hurt by being dragged through the court on fender-bender claims, and yet we don’t see any collateral benefit in the form of reduced premiums even for the other policyholders.” He says that he thinks “this kind of program is institutionalized bad faith.”

My last blog entry was a rambling diatribe about how desperately we need first-party bad faith in Maryland. But I do not agree with Professor Stempel that insurance companies’ decisions to aggressively fight claims are tantamount to bad faith in every case. The insurance companies have a right to take a tough posture, particularly in the third-party context. Our personal injury lawyers’ job is to fight back when they do. I do not think we deserve a free ride in third party cases.

July 2, 2006

New Maryland Uninsured Motorist Case

by Ronald V. Miller, Jr.

The Maryland Court of Appeals last month issued another opinion interpreting Maryland Insurance Code Annotated Section 19-509 in State Farm Mut. Auto. Ins. Co. v. DeHaan.

Here, the Plaintiff’s night got off to a great start: the Baltimore Ravens won their first Super Bowl over the New York Giants, a night everyone in Baltimore remembers. On his way home from a party, Plaintiff stopped at a Shell Station in Baltimore County (near the old Westview drive-in movie theater) in his 1989 Chevrolet Blazer, which was insured under a State Farm automobile insurance policy that had $10,000.00 coverage in Personal Injury Protection benefits (PIP) and $100,000.00 coverage in uninsured motorist benefits.

After arriving at the gas station just after 1:00 a.m., Plaintiff put his keys on the driver’s side floorboard and entered the convenience store portion of the Shell station to make a purchase. Upon returning to his vehicle, Plaintiff found someone sitting in his car. The intruder shot him and drove away.

June 12, 2006

Is Uninsured Motorist Coverage Available in Maryland for an Intentional Car Accident?

by Ronald V. Miller, Jr.

A Virginia lawyer wrote me last night asking about a client that was injured in a motor vehicle accident in Maryland.

Apparently, the car accident was a by-product of road rage that reached a point where the Defendant arguably intentionally rear-ended the Plaintiff’s car. The Defendant apparently admits positioning his car to retaliate against the Plaintiff but claims the contact was unintentional. The insurance company is refusing to defend or indemnify the case because it claims the Defendant’s recorded statement to them admits that the conduct was intentional.

The lawyer’s question is whether uninsured motorist coverage is available to this Plaintiff in Maryland. Assuming that the Plaintiff did not intentionally cause the car accident, the answer is yes. Section 19-501(c) of the Maryland Annotated Code of Insurance requires only that the Plaintiff did not intentionally cause the traffic collision. Continue reading

March 19, 2006

Resident Relative for Uninsured Motorist Coverage

by Ronald V. Miller, Jr.

The Maryland Court of Special Appeals had occasion this month to consider what makes up a resident relative for uninsured motorist coverage in Mundey v. Erie Insurance Group. Here, The Maryland intermediate appellate court found a Prince George’s County man who had been living with his grandmother in Waldorf, Maryland (Charles County) for almost a year not to be a resident relative of his parents who lived in Lusby, Maryland and therefore his parents’ uninsured motorist coverage with Erie Insurance could not apply to his auto accident.

The Plaintiff, who the Court noted was not a full-time student, lived with his grandparents for the 11 months preceding the auto accident. During that time, the Plaintiff visited his parents’ home approximately four to six times, spending the night on Thanksgiving and Christmas. On these holidays, Plaintiff slept on an extra bed in his younger brother’s room because they had converted his bedroom for other uses after he left. Erie Insurance’s accident lawyers argued that under these facts, the jury should not deem the Plaintiff a resident relative and could not recover from Erie Insurance for his personal injuries from his auto accident under his parents’ uninsured motorist policy. Plaintiff’s personal injury lawyer, Waldorf attorney Michael J. Schreyer, contended that “resident,” as defined in Erie Insurance’s policy, limits the statutorily required uninsured/underinsured motorist coverage and makes up an impermissible exclusion from coverage, thus violating the public policy goals of Md. Code Ann., Ins. § 19-509.

The Maryland Court of Special Appeals disagreed with Plaintiff’s attorney, ruling that Plaintiff was not a “resident” of his parents’ Lusby home as defined by their insurance contract with Erie Insurance. The court reasoned that according to the policy, the Plaintiff would be a resident only if he physically lived in his parents’ household, is under the age of 24, and attends school full-time. Writing for the court, Judge J. Frederick Sharer found that the “undisputed evidence before the court established that the appellant failed to meet either definition of ‘resident’ because he did not physically live in his parents’ home and did not attend college.”

March 2, 2006

Uninsured Motorist Decision in New Jersey

by Ronald V. Miller, Jr.

The New Jersey Superior Court, Appellate Division, ruled last month in Dolores Kleiber v. State Farm Ins. Co. that the trial court properly entered summary judgment in favor of State Farm. This case involved in a lawsuit filed by a State Farm insured seeking a declaratory judgment that entitled the Plaintiff to additional optional uninsured motorist (UM) coverage because her insurer failed to offer her optional coverage when she moved from Florida to New Jersey shortly before a car collision she had in the fall of 1999 with an uninsured driver.

The New Jersey Superior Court, Appellate Division, ruled the trial court did not err in entering summary judgment in favor of an insurer in an insured’s action seeking a declaratory judgment that entitled her to additional optional uninsured motorist (UM) coverage because her insurer failed to offer her optional coverage when she moved from Florida to New Jersey.

Plaintiff’s attorney’s argument was a stretch, contending that because the policy was issued in Florida, State Farm offered her additional coverage because State Farm knew she would drive her car in New Jersey. She claimed that if they had informed her they required her to get insurance in New Jersey, she would have got $100,000 in optional UM coverage.

January 24, 2006

New Maryland Uninsured Motorist Bill | Proving No Insurance

by Ronald V. Miller, Jr.

The burden is on the plaintiff in Maryland in an uninsured or underinsured motorist claim to prove that the negligent car, truck, or motorcycle was uninsured or underinsured. The attorney’s inability to establish a lack of insurance is fatal to an uninsured motorist claim. Some jurisdictions, such as Texas, realize how difficult it is to prove that an automobile is not insured and shifts the burden of proof to the insurance company. See Tex. Ins. Code. Ann. art. 5.06–1(7). It is sometimes very hard, as they say, to prove a negative.

New Maryland Uninsured Motorist Law

While not as accident victim-friendly as Texas, there is a bill pending in the Maryland General Assembly that would make the hard job of proving a negative a great deal easier. House Bill 1162 would enable plaintiffs bringing uninsured motorist claims to prove that the negligent driver was uninsured by one of two methods:

January 4, 2006

Court of Special Appeals Rules Against Motorcycle Passenger

by Ronald V. Miller, Jr.

The Court of Special Appeals of Maryland ruled last week in Shafer v. Interstate Automobile Ins. Co. that a motorcycle passenger – who was injured when the motorcycle on which she was riding blew out a tire – is not entitled to uninsured motorist coverage because she failed to meet her burden of proof that the damage to the tire was caused by third-party negligence. Accordingly, the court affirmed a Washington County, Maryland trial court judge who granted summary judgment on behalf of defendants Interstate Insurance and Nationwide Insurance.

This case underscores that Maryland law requires proof of negligence to make a recovery even if it is an uninsured motorist case.

Key Facts of the Case