Can You Sue Someone After Settling With Their Insurance?
When you file an insurance claim, you are seeking monetary compensation for a loss you suffered, sometimes as a result of someone else's negligence. If someone else is responsible for the loss, you usually settle with his insurance company. Sometimes, you may be dissatisfied with the insurance settlement for a variety of reasons. In these cases, you may wonder if you are able to sue the responsible party directly.
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Tort States
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Most states operate on a traditional tort system, meaning that people in that state are free to use the court system to sue each other for monetary damages after collisions. Typically, law enforcement agencies and insurance companies determine who caused an auto collision and assign negligence accordingly. In tort states, the negligent party is legally liable for all damages, and his insurer pays these damages on his behalf. People are generally free to sue each other even after receiving an insurance settlement, if they choose.
Liability Waivers
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To avoid rampant lawsuits, insurers sometimes utilize liability waivers during the settlement process. This is a form that the claimant must sign as a condition of receiving the settlement money. It says, in essence, that the claimant waives the right to pursue further legal action against the insurer's client in exchange for the money. The form is signed and dated with witnesses and kept on file in the insurer's records. The claimant may still file a lawsuit, but the waiver may limit her success in collecting further compensation.
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No-Fault States
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Some states use a no-fault insurance system, which legally limits the right to pursue certain types of damages in court. Under a no-fault system, an insurer pays for its customer's injuries directly, without regard to negligence. If both parties to an accident are injured, both will claim against their respective insurers for medical benefits. In exchange, they are not permitted to use the court to sue each other for additional compensation except in extreme circumstances. The conditions under which further legal action is permitted varies by state, but they always include injuries of a serious or permanent nature.
Property Damage in No-Fault States
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No-fault insurance applies only to injuries. Personal injury protection is primarily a medical coverage, though it also provides lost wage and death benefits when circumstances require. Property damage is handled according to the tort system, even in no-fault states. This means that if your vehicle is damaged by a negligent party and you are dissatisfied with the insurance settlement, you are generally free to utilize the civil court system to seek additional compensation even if you cannot do so for your injuries.
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References
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