What can I do if my insurer lowballs the person I hit?

The point of buying any liability insurance, including automobile liability insurance, is to protect you if you get sued.

If a policy’s coverage applies, then your insurer must provide a legal defense for you if an accident victim sues you. If you are legally responsible, the insurance company must pay off the victim up to the limit of your policy.

While the insurance company does not pay money directly to its policyholder, the policyholder should still be able to rest assured that, for most accidents, they will not have to worry about losing their property an income to liens and wage garnishments.

Some insurance companies and even individual claims adjusters may use tough litigation and negotiation tactics against an accident victim. Sometimes, this is helpful and even necessary to protect a policyholder.

On the other hand, under Texas law, a tough legal defense becomes problematic when the insurance carrier puts their policyholder at risk of a trial, and a huge legal judgment, when it has become clear that the carrier needs to pay up on behalf of their policyholder.

Unreasonable refusals to negotiate or unfounded lowball offers endanger the policyholder the insurance carrier is supposed to protect. If a policyholder faces this situation, they may be able to work with the victim of the accident to pursue a bad faith claim against the carrier.

Pursuing a bad faith claim can be a complicated legal matter

Not surprisingly, insurance companies do not like to be accused of bad faith. Not only does impact their reputation, but an accusation of bad faith could end with the insurer paying amounts above the limits of their insurance policy, sometimes to the tune of millions of dollars.

Those who believe their insurance carrier mishandled a liability claim against them may have legal options, but they will need to make sure they understand them. Likewise, accident victims may be able to pursue an insurance carrier if the insurance carrier declined to pay policy limits.