Collecting Insurance After a Loved One Dies

Insurance Companies May Not Treat You Fairly

By law, insurance companies have a legal obligation to pay out full and fair settlements on valid claims. However, many companies attempt to skirt these laws by pushing victims to accept fast settlements that are much lower than the true value of a claim. Victims often accept these payments without negotiation because they do not know their rights.

Rhode Island laws are particularly strict when it comes to forcing insurers to pay valid claims. In a recent decision against Allstate, the Rhode Island Supreme Court struck a blow against insurers, setting strict rules and penalties for those who underpay or delay claims.

Insurers in the state:

Cannot deny fair requests that are within policy limits.

If an insurance company rejects a written demand that is within the policy limits, policyholders can take the claim to court and request additional amounts (such as for pain and suffering).

Must pay judgment amounts and interest even if they are above policy limits.

If the victim is awarded damages in court that are over policy limits, the insurance company is liable for the entire judgment, with interest.

Do not have to engage in bad faith in order to be liable for extra damages.

Insurers can still be responsible for damages over policy limits if they acted in good faith, if a judge or jury disagrees with the insurer’s assessment of the value of the claim. Family members also do not have to prove bad faith in obtain extra-contractual damages.

This ruling is vital for the benefit of victims with low policy limits who suffered significant wrongful death damages in the form of lost wages, medical bills, and pain and suffering. It also gives insurance companies an incentive to avoid going to court in case the jury awards high pain and suffering damages.

Related links:

Your Right to Fair Insurance Compensation After a Wrongful Death

Insurance Companies May Not Treat You Fairly

Cannot deny fair requests that are within policy limits.

Must pay judgment amounts and interest even if they are above policy limits.

Do not have to engage in bad faith in order to be liable for extra damages.

Has Your Loved One Died To The Negligence Of Others?