Too Many Claims, Not Enough Coverage
Oftentimes we’re not riding in a car alone, so it’s not surprising that many auto accidents in North Carolina involve multiple victims. Liability insurance has limits, so what happens when there are several claims and not enough money?
Let’s talk about automobile insurance in North Carolina first. We are required by law to have liability coverage that is there to cover the damages caused by our negligence towards other folks. The NC minimum is $30,000 per person/$60,000 per accident. That means that if you and your spouse are struck by another driver who has minimum limits, neither of you can collect more than $30,000 and the most you can collectively get is $60,000. IF you happen to carry Underinsured Motorist Coverage (UIM) then you might have some other options, but read that post for more info on what that is.
But what if there’s no UIM and the liability coverage is all there is? And what if there are enough claimants with big enough claims that the 30/60 policy isn’t enough?
What the liability carrier will try to get you to do is have EVERYONE agree to a pro-rata settlement. That would involve having each claimant settle for a percentage of the coverage, depending on the value of their relative claim to the other claims/coverage. Depending on how that looks to everyone, maybe that’s an acceptable outcome. But maybe it’s not.
If you can’t settle for the coverage available, then the only other option (other than just giving up) is to file suit and seek what’s called an “excess judgment,” which means a judgment in excess of the policy limits. But this isn’t certain, because you’re starting from scratch; you have to prove negligence, causation of your damages, and the amount of your damages. And there’s another rub: What about the other claimants?
This stuff gets complicated. If you have an automobile accident in North Carolina you should call me at 919-929-2992.
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