Defendant’s Insurer Has Offered the (Inadequate) Policy Limit: Now What?

An injured plaintiff does not get a vote on the amount of a defendant’s insurance policy coverage limits, and also didn’t get a vote on the defendant’s carelessness that rendered the plaintiff injured.  So when the defendant’s insurance carrier offers the defendant’s policy limits in a case where the plaintiff’s injuries and damages far exceed those coverage limits, what remedy is available to the plaintiff?  If the case arises from a motor vehicle or truck collision, the plaintiff may have coverage under their own underinsured motorist coverage, but only if that coverage limit exceeds that of the defendant (California has an “anti-stacking provision in its Insurance Code, meaning that one can’t just add the two coverage limits together; the plaintiff’s insurer gets a dollar-for-dollar credit for any recovery obtained from the defendant’s policy coverage).

When the plaintiff’s damages far exceed the defendant’s coverage limit, and further compensation is not available under plaintiff’s own coverage, we insist on receiving an asset declaration from the defendant signed under penalty of perjury, which confirms that the defendant has no assets to satisfy a judgment other than the proceeds of their insurance policy coverage.  Any settlement for the defendant’s policy limits is conditioned on receipt of that signed asset declaration.  If the defendant refuses to sign such a declaration, it suggests there may be assets the defendant would prefer us not to know about.  The purpose of demanding and receiving such an asset declaration is to provide confirmation to the plaintiff that there is no point in pursuing that defendant to judgment after trial, since it would likely result in the defendant’s bankruptcy filing.

Janssen Malloy LLP’s attorneys have deep experience in pursuing all avenues to obtain justice and fair compensation for our injured clients.  Our firm is in the process of executing a $3.2 million judgment against defendants who defaulted (failed to appear and defend themselves against our client’s lawsuit); we have documented assets those defendants have and will pursue all available remedies to collect that judgment.  When injured persons are facing a defendant with limited insurance coverage, that fact alone does not end the inquiry.