I frequently hear of individuals who have been in accidents but who want to settle with the other party privately, without an attorney and without involving insurance. Their reasoning may be based on the faulty assumption that their insurance rates will go up dramatically if they report an accident, even when they are not at fault. Or they may think an attorney will not be able to get them a better result. I cannot state strongly enough how risky such private settlements can be. There are simply too many ways for this to go wrong. The following are some of the possible complications of a private accident settlement. This list is by no means comprehensive and should not be used as a guide to actually negotiating a settlement. If you have been injured in an accident please contact an experienced personal injury attorney immediately to ensure that your rights are protected.
Accident liability in California hinges on fault. In most vehicle accidents we are referring to negligence, which is a failure to do what a reasonable person would do under the circumstances. California follows a pure comparative negligence rule. Under this system you may be entitled to damages against someone even if you partially caused the accident. However, you’ll only be able to collect that portion of your injury which was caused by the other party. For example, let’s say you’re in a car accident with another driver. At trial the jury determines that you were 20% at fault for the accident and that your total damages are $100,000. In California, you’ll be able to collect 80% of those damages from the other party, which is $80,000. Of course, if you were 20% at fault the other party will also be able to collect 20% of their damages from you or your insurance company.
You may also have a claim against parties other than the other driver. For example, the registered owner of a vehicle has liability up to the statutory minimum insurance limits of $15,000 per person and $30,000 per accident for injuries when they permit another driver to use their vehicle. The owner’s liability is unlimited if they have negligently entrusted their vehicle to an unfit driver.
If your vehicle is defective, causing an accident or increasing your injuries, you may have a strict liability claim against the manufacturer of the vehicle or its component parts. If your vehicle is defective because of negligently performed maintenance, you may have a claim against the dealership or other repair facility.
If you were injured in an accident caused by a defective roadway, you may have a claim against the responsible government entity. In most California injury cases you have a 2-year statute of limitations, meaning you must either settle your case or file a lawsuit against the responsible parties within two years of the accident or your claims will be barred. However, if you have a claim against a government entity, you must file a written claim within 6 months. This is trap for the unwary.
The point is that without expert legal advice, you may not know for sure who is legally responsible for your injuries or for how much each party will ultimately be liable.
Estimating what an injury case is worth takes knowledge and experience. A person who has been injured in an accident can claim damages in several areas. Assuming liability, you are entitled to recover your past and future medical expenses, loss of earnings, and non-economic damages, often referred to as pain and suffering. Non-economic damages include past and future physical pain, mental suffering, loss of enjoyment of life, loss of earning capacity, disfigurement, physical impairment, inconvenience, grief, anxiety and humiliation.
If you are the victim of a convicted drunk driver and/or a hit and run driver, you can also claim punitive damages designed to punish the other driver’s behavior.
If you were hit by an uninsured motorist, you can make a claim against your own insurance policy for the damages that you would be entitled to recover from the uninsured person. You may also have medical payments coverage on your policy that can be used to cover your medical expenses regardless of fault.
In every case, it is important to investigate the facts of the accident, the potential losses and all theories of recovery before making a decision to settle or litigate the case. Once you sign a release it is too late to ask for more, even if it turns out your injuries were more severe than you initially thought.
Misconceptions about insurance rates
People often worry that following the normal channels for dealing with an accident will cause their insurance rates to skyrocket. Generally speaking, if you are not more than 50% at fault, you probably won’t see an increase in your rates. In other words, if you didn’t cause the accident, reporting it to both insurance companies, and ultimately collecting from the offending party’s insurance, probably won’t hurt you.
Creating insurance problems
Private settlements are also problematic from a coverage standpoint. Your insurance policy requires you to report any accidents promptly. If you are hit by an unknown driver, you must also report the accident to the police within 24 hours or you may lose your uninsured-motorist coverage. Also, if you cause an accident and fail to report an accident and attempt a private settlement, which later fails, your insurance company may refuse to defend you or pay a judgment against you if they were unable to investigate and were prejudiced by your actions. In addition, you have an obligation to report the incident to the DMV, and, if anyone was uninsured, there will be consequences such as a suspended driver’s license. In other words, many of the motivations people report for attempting a private settlement aren’t actually avoided, and are in some cases exacerbated, by private deals.
Use a lawyer
If you have been injured in an accident, retain an experienced personal injury attorney. Settling your accident privately is legally and financially risky. Get the legal help you need and avoid years of potential headache down the road.
If you have been injured in a California accident, call personal injury attorney Don Sjaarda at 714 963-8216 for a consultation.