Why Can’t I trust The Insurance Company?

If you think you can trust the insurance company to “do the right thing” with your case, GUESS AGAIN!

Let me give a real-life example of the dishonesty of some insurance companies: Client “Y” is a 30 year old cook from rural Georgia who sustains massive personal injuries in a collision between the car in which he is a passenger and a tractor trailer in New York. Client “Y” is an innocent victim of the accident and he spends 53 days in the Intensive Care Unit of Kingston Hospital and 61 days at the hospital for internal bleeding and fractures throughout his body. By all accounts, Client “Y” was horrendously injured in the motor vehicle accident and his survival was in doubt throughout much of his hospitalization. Client “Y” incurred $163,000 in medical expenses at the Kingston Hospital and he is disabled for the rest of his life from employment.

After an additional two month stay at a rehabilitation facility in New York, Client “Y” flys home to Georgia. Within days after his return home to rural Georgia, Client “Y” receives a telephone call from an insurance agent for Nationwide Insurance Company, the insurer for the motor vehicle in which he was a passenger. The insurance adjuster informs Client “Y” that it has a check in the sum of $15,000 for the damage done to his automobile and he can get the check at the Nationwide office.

On the day that Client “Y” arrives at the Nationwide office, he had not consulted with a lawyer and he was unaware of his legal rights. Furthermore, Client “Y” was still in significant pain from his injuries and he was having financial difficulties as a result of his lack of income.

When Client “Y” picks up the check at the Nationwide office, there is a notation in the bottom left-hand corner of the check reading, “Settlement of any and all claims for bodily injury arising from the motor vehicle accident”. Client “Y”, however, is semi-literate, does not understand the meaning of the notation and he is assured by the claims adjuster that the check represents payment only for the damage to his car. Client “Y” relies upon these promises when he deposits the check in his bank account.

Months later, Client “Y” commences a lawsuit in New York for the serious and lifelong personal injuries that he sustained in the motor vehicle accident. The liability insurer for Client “Y”‘s car, Nationwide Insurance, moves to dismiss the lawsuit on the basis that Client “Y” accepted the check for $15,000 in full satisfaction of his claims for personal injuries and it relies on the notation on the bottom left-hand corner of the check.

Of course, Client “Y” had difficulty reading and understanding the notation on the check and since he was not represented by a lawyer at that time, he did not understand the consequences of accepting the check. The insurance company knew that Client “Y” was not represented by an attorney and that he was unable to read or understand the meaning of the notation on the check. The opportunity was perfect for the insurance company to deprive Client “Y” of his rights.

New York’s Appellate Division, Third Department, ultimately denies Nationwide’s motion and dismisses the insurance company’s claim that Client “Y” settled his claims against Nationwide by depositing the check. The court’s decision made it clear that the court would not tolerate the transparent attempt by Nationwide to deprive a policy holder of a very substantial claim for personal injuries for the modest sum of $15,000. The duplicity of the insurance company was clear from day one.

Keep this case in mind when an insurance company wants to settle your case. You cannot trust the insurance company to do the right thing.