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The Role Insurance Companies Play in Personal Injury Cases: A Comprehensive Guide

Earlier this year, Florida enacted tort reform measures that critics argue will decrease the rights of personal injury victims and make it more difficult for them to pursue damages from insurance companies that deny claims or short-shrift compensation. Given the changes to personal injury law, the legal experts at Tallahassee’s Akbar Thomas Law thought it would be an opportune time to review the role of insurance companies in the state’s personal injury law.

Because personal injury litigation is largely process-driven, understanding the role insurance companies play in limiting just compensation can help support the injured party’s resolve. If you believe an insurance company is stonewalling your personal injury claim, we trust the following comprehensive guide will help you.

What Is an Insurance Company’s Role in Personal Injury Law?

Insurance companies are involved in personal injury law because most people and businesses carry insurance policies that cover personal injury claims. These policies include—

  • Auto insurance
  • Boat insurance
  • Business liability insurance
  • Homeowner’s insurance
  • Medical malpractice insurance

—and cover the insured from personal injury and wrongful death claims arising from traffic and boating accidents, defective products, slip and falls, medical mistakes, and other situations.

Thus, if you’ve been injured in an accident caused by the apparent negligence of others, insurance companies take a lead role in trying to resolve personal injury claims. However, because insurance is a business, insurers strive to limit the compensation they must pay victims. In some cases, an insurance adjuster or other representative may reach out to an accident victim before they’ve even had a chance to consider making a claim.

While this may seem thoughtful, their goal is to gather any evidence that may help limit or deny the damages from an expected claim. They might also try to minimize compensation by encouraging a quick settlement on less-than-favorable terms. Anyone injured in an accident should always consult with a skilled personal injury lawyer before agreeing to any settlement offered by an insurance company. In fact, you should limit your interaction with insurance representatives until you’ve had a chance to consult with your attorney.

Insurance Company Responses to Liability Claims

Absent an initial low-ball settlement offer from the insurance company, an accident victim must begin the claims process by sending a demand letter to the at-fault party and insurance company. This letter formerly demands payment for economic and non-economic damages incurred by the victim and asserts liability by detailing the causes of the accident.

The respondent insurance company has several options in response to a demand letter. It can make a counteroffer on the compensation amount, request negotiations, deny the claim, or ignore it altogether. Counteroffers and negotiations suggest that the liability claim holds some merit and that the insurance company may be willing to seek reasonable terms.

However, the latter two options could indicate that the insurance company does not believe the claim has merit or are just being used as a delaying tactic. While there used to be a four-year statute of limitations on making a personal injury claim in court, the recent changes to Florida law have reduced this to two years.

Moving the Claims Process Forward

If counteroffers and negotiations fail to lead to a successful settlement, the opposing sides’ lawyers may agree to enter mediation or binding arbitration. In mediation, a neutral mediator tries to steer the parties to a settlement they can both agree on. Binding arbitration leads to compensation decided by a neutral arbitrator who serves as a quasi-judge.

Turning to the Courts

With the new two-year statute of limitations on pursuing personal injury lawsuits, accident victims need to watch the clock and be wary of insurance company delaying tactics. As such, if the deadline draws near and settlement efforts are failing to produce results, it becomes time to file the personal injury claim with Florida’s court system. Settlement negotiations can continue before the actual trial, and judges often encourage the parties to engage in pre-trial mediation or arbitration if they haven’t already done so. Negotiating positions can be weakened or strengthened by the pre-trial discovery phase, during which the opposing sides disclose their respective evidence supporting their case. Absent any settlement, a judge or jury will decide the case after both sides present their evidence and narrative of the accident during trial.

The importance of legal representation in Florida personal injury cases cannot be overemphasized. Insurance companies are backed by teams of lawyers who are highly adept at finding ways to deny or limit personal injury claims. A competent personal injury lawyer will:

  • Investigate the accident to determine fault.
  • Collect evidence and secure witnesses to support the liability claim.
  • Assess economic and non-economic damages to establish a just compensation amount.
  • Ensure that the victim is receiving all necessary medical care.
  • Initiate the claims process by preparing a robust demand letter.
  • Negotiate with the insurance company’s lawyers to secure a favorable settlement.
  • Engage in mediation or arbitration if warranted.
  • File a lawsuit before the statute of limitations expires.
  • Ensure that other legal deadlines are met.
  • Secure expert witnesses to reconstruct the accidents and/or detail the extent and impact of injuries.
  • Argue the case in civil court.

Recent Personal Injury Decisions

According to the Lawsuit Information Center, more than 450 plaintiffs successfully secured damages in personal injury lawsuits during 2022, with almost 80 of these plaintiffs winning awards of $1 million or more. The actual monetary amount of successful claims in the state during that year was likely much higher, as most cases that settle before a verdict are kept confidential.

In what is one of the state’s largest verdicts ever in an auto accident case, a Miami-Dade jury ruled a Miami bar negligent in serving alcohol to a drunk patron, who later sped the wrong-way down I-95, causing a head-on collision that killed a young woman and severely injured her brother. While the jury awarded the South Florida family $95 million, it will undoubtedly be challenged on appeal, and the family will face other legal challenges in collecting the total amount even if they win the appeal.

In another interesting case, a Sarasota jury ordered the state and its insurers to pay $28 million in a personal injury lawsuit filed against the Department of Children and Families. The plaintiffs successfully argued that the department was negligent in not removing a six-year-old child from an obviously dangerous home situation, leading to a horrific assault that left the child with a lifetime future of medical and psychological issues. That decision was recently upheld by a Florida appeals court.

Take on the Insurance Companies With Akbar Thomas Law

With more than two decades of experience in the Tallahassee area, Akbar Thomas Law’s team has extensive experience successfully challenging insurance companies to secure just compensation for personal injury clients. To learn more, contact us today at 850-383-0000 or start a conversation with our chatbot by clicking the “Live Chat” box.