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The Options You Have When an Insurance Company Wrongfully Fails to Pay Your Claim

We’ve all heard the amiable jingles or slogans, sometimes recited by popular actors, singers and athletes, telling us about how an insurer will be “on your side” or that you will be “in good hands.” The reality is, though, that insurers often work hard to avoid paying claims, even to their own customers. When that happens to you as a result of an auto accident, you may have various options and, depending on the exact facts of your situation, it may open the door to recovery of substantial compensation. To be ready when that happens to you be sure you have someone on your side… and that that someone is an experienced San Mateo auto accident attorney.

M.M. was one of those unfortunate people whose experience with his insurer was less than cheerful. M.M. was seriously injured in a high-speed head-on collision. The other driver was at-fault, having crossed a double-yellow line to pass slower vehicles.

M.M. survived, but suffered a severe injury that shattered his left heel bone. The injury caused a permanent deformity and was extremely painful. His doctors concluded that he’d face a lifetime of chronic pain and problems related to that heel.

The at-fault driver’s insurer paid M.M. $50,000, the limit of that driver’s insurance policy. Because M.M.’s damages were well in excess of $50,000, his lawyer filed a claim with M.M.’s insurer under M.M.’s underinsured motorist coverage. That coverage had a policy limit of $100,000. Because M.M. had already received $50,000, that meant that the most his insurer was obliged to pay was $50,000.

The insurer didn’t offer $50,000, though. Instead, it offered to settle the claim for a mere $1,000. Over the next several months, the insurer upped the offer to $13,000 and, later, $18,000.

The case went to arbitration and the arbitrator ruled that the insurer should have paid the policy limit (a/k/a the full $50,000.) M.M.’s insurer wrote him a check for $50,000. That was 2½ years after the injured man’s original claim request.

Bad faith by insurance companies may entitle you to punitive damages

So, when an insurer has delayed, sidestepped and stonewalled to avoid paying you what it owes, and you spend many years waiting (and litigating or arbitrating,) it that the end? Can you only get the damages award you should have received in the first place? The answer in California is “no.” The law allows you to sue the insurer for what’s called “bad faith,” and you can potentially recover significant compensation. You can be paid for the mental suffering, anxiety and emotional distress the nonpayment and delay caused you, and you can also recover attorney’s fees that you paid in order for your lawyer to help you get the money you should have had all along.

You can also get punitive damages if you can prove that the insurance company acted maliciously, fraudulently or in a way that was oppressive.

In M.M.’s case, he obtained both types of awards. In addition to the $50,000 claim payment, he was entitled to $313,000 in compensatory damages for mental pain and anguish along with attorney’s fees. On top of those amounts, the court also concluded that he was entitled to punitive damages in the sum of $1 million.

Each case comes twists and turns. And with each set of twists and turns may come options and opportunities under the law. Be prepared for whatever direction your case goes by having legal counsel with the experience you need. The skilled San Mateo personal injury attorneys at the Law Offices of Galine, Frye, Fitting & Frangos are ready to help. Our attorneys have been helping injured people for many years as they take on the insurance companies and others who owe them compensation. To set up a free consultation with one of our knowledgeable attorneys, contact us at 650-345-8484 or through our website.

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    I retained Ilya Frangos of Galine, Frye, Fitting & Frangos on a business litigation matter involving a frivolous lawsuit filed in federal court. Ilya guided me through the case and helped make sure that I understood the process… He always took the time to answer all my questions and helped put my mind at ease. I would highly recommend him and this firm!


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    Chantel Fitting is as good as it gets. If you have been injured, need help and cant get what you know you deserve from one of the big insurance companies, then you have got to call Chantel. She will fight for you like it was her that was hurt… She cares. Call her. You wont be sorry you did.

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    A great experience. Excellent law firm which treats their client’s with the utmost respect. Very knowledgeable and made me fell extremely secure when handling my personal injury claim. Would highly recommend Galine, Frye, Fitting & Frangos to handle your next case.

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    I was fortunate enough to have been represented and retained by this law firm for my injuries sustained by an under insured motorist. I must say Chantel Fitting and Illya Frangos went above and beyond trying to resolve my case… I would highly recommend this law firm and stop shopping around if you are looking for the best, as this is as good as it gets.

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