Should we sign a statement regarding an insurance claim if out insurer wants us to?

My husband was involved in a car accident 2 months ago. He hit a pedestrian while she was crossing the street. She was at a crosswalk with no stop signs. 2 weeks ago our insurance company called to assure us that all was well and that the victim had accepted our maximum benefits and that the case should be closed soon. Today the insurer called back and told me that the victim does not accept the settlement and wants my husband and I to sign a declaration which states we have no other insurance. What do we do?

Asked on October 14, 2011 under Accident Law, California

Answers:

Jonathan Reed / Reed & Mansfield

Answered 9 years ago | Contributor

If it is true that you and your husband have no other applicable insurance, signing a declaration to that effect (which is a statement you sign under penalty of perjury) may help persuade the pedestrian and her attorney to take your insurance company's policy limit settlement. This would be to your benefit because it might get the case resolved.

As a general rule if a lawyer represents an accident victim whose claim is arguably worth more than applicable insurance policy limits, the attorney and their client face this choice if the insurance company offers it policy limit: 1) They can take the policy limit settlement but the insurance company will make them release the entire claim, or 2) They can turn down the policy limit settlement. In that case the insurance company will most likely refuse to pay and the client and attorney will have to file suit and take the case to trial. If they win at trial they can then collect the insurance policy limits and go after the insured person's assets.

Option 2 is much more expensive and time consuming. In all probability the pedestrian victim and her attorney are considering Option 1 and want to make sure that they are not leaving any easy insurance money (from a different policy) on the table.

Since I do not know all of the specific facts of your case I cannot be sure that the answer I have just given covers your situation completely.


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