What you need to know:
- If you have liability insurance, then you have pre-paid legal protection when someone sues you over a car accident
- Your liability insurance carrier has a duty to defend you in any car accident lawsuit
- However, you must notify your insurance company of the lawsuit in order to trigger their duty to defend
What to do when someone sues you for a car wreck
You were involved in a car accident. You exchanged your information with the driver of the other vehicle. Hopefully you followed theses steps.
Eventually you discuss the incident with your insurance company. And then time goes by and nothing happens.
One day, months or even years later, you get served with a lawsuit. What?! You read the lawsuit and realize the same driver that you exchanged information with has now sued you.
Many thoughts race through your head. “Do I need a lawyer? How much does a lawyer cost? Where do I find a lawyer?” The questions are building at the same rate as your rising stress and blood pressure.
But whether you realize it or not, you’ve already taken care of the problem. You’ve already obtained legal representation for this exact situation.
Your Liability Insurance Carrier is Responsible for Defending the Lawsuit
By obtaining liability insurance coverage, you have already arranged for legal representation in the event of a lawsuit. That is exactly what your liability policy provides.
Your insurance carrier is responsible for retaining a local lawyer, filing the necessary legal documents in court, and handling the entire case, solely at the insurance carrier’s expense. You do not have to pay anything. (You’ve already paid your premiums).
You must immediately Report the lawsuit to your insurance carrier.
As soon you are served with the lawsuit, you should call your insurance carrier and report it. This puts your insurance company on notice of the pending litigation, and triggers their duty to intervene and defend the claim.
By purchasing liability insurance, you have purchased a safety net of legal representation in the event you are sued (i.e. someone claiming you are responsible for the wreck). If the insurance company fails to intervene and defend you, then it has committed bad faith against you, a big no-no in the insurance industry.
However, your insurance company has not duty to defend you if it does not know about the existing claim or lawsuit. Therefore, you must notify them immediately once you are served. Once you have notified your insurance carrier, you are in the clear and the weight of the case rests entirely on the shoulders of your insurance company.
Your Liability Insurance Carrier is Responsible for Everything
Whether you win, lose, or settle, your insurance carrier is responsible for everything, including paying the verdict or settlement, and all costs and legal fees involved.
If your insurance company does not defend you, even after putting them on notice, then you should consult an attorney about a bad faith lawsuit against the carrier.