How do You Collect Compensation Beyond Policy Limits?

Monday, November 28, 2016

How do You Collect Compensation Beyond Policy Limits?

Written by Malman Law, reviewed by Steve J. Malman.

Experienced Attorneys Fighting for More for Accident Victims in Chicago

An insurance company is there to resume responsibility for an injury case. Whether it is medical malpractice or a car insurance claim, they handle claims filed against their insured. Then, the insurance company pays out costs of damages and legal fees that are agreed in a settlement or awarded during a trial. Insurance companies only pay out based on the policy limit. Therefore, it is important for accident victims to understand how policy limits work, and what their options are if they must collect beyond a person’s policy limit.

What is a Policy Limit?

When someone purchases insurance, there is a liability limit attached to that policy. This is the maximum amount the insurance company pays for. For example, a car insurance policy has a limit of $25,000. If a claim is filed against that policy, the insurer only pays $25,000. The insurance company does not pay past the limits of the policy. Instead, that money must come from someone else.

How Do You Collect Excess Damages?

Excess damages are those that exceed policy limits. There are ways for a plaintiff to collect excess damages, such as:

  • Bringing their lawsuit against third party defendants.
  • Recovering through umbrella policies.
  • Collecting from the defendant.

Suing Additional Parties

In an incident, there may be more than one responsible party. In this case, each defendant’s insurance policy limits would be used to pay damages. Some examples where multiple defendants may occur include:

  • Malpractice Claims – Hospitals, physician, nursing staff, clinic, or additional physicians.
  • Vicarious Liability Claims – This holds the employer responsible for the actions of their employee.
  • Product Liability Claims – Manufacturer, secondary parties, distributors, retailers, and warehouses could be held liable.
  • Premise Liability Claims – Property owner and manufacturer could be held liable.

Tapping into Umbrella Policies

Some defendants have umbrella policies. This is especially true when the defendant is a business. The umbrella policy would kick in after the initial policy limits are exceeded. Then, the umbrella policy can be accessed up to its limits.

Collecting from the Defendant

This is not only possible, but if the defendant has significant assets or cash, the remaining damages are collected from them personally.

In some cases, a judge may issue a wage garnishment or place a court lien on the defendant’s property. If there are no assets, however, there may be no options for recovery.

To Receive Maximum Compensation, Contact an Attorney

If you want to receive maximum compensation, you must contact an attorney. An attorney will review policy limits, potential umbrella policies, and ensure all defendants are listed in the suit. This ensures that you receive the compensation you need to fully recover from your injuries and damages.

To explore your options for compensation, meet with an accident attorney from Malman Law today. Schedule your free consultation or request more information through our online contact form.

Steve Malman

Malman Law’s founder Attorney Steven Malman has over 30 years of experience handling personal injury, nursing home, medical malpractice, truck accidents, car accidents, premises liability, construction, and workers’ compensation cases in Chicago, IL.

Years of experience: +30 years
Justia Profile: Steve Malman
Illinois Registration Status: Active and authorized to practice law—Last Registered Year: 2024

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This page has been written, edited, and reviewed by a team of legal writers following our comprehensive editorial guidelines. This page was approved by President and Founder, Steven J. Malman who has more than 20 years of legal experience as a personal injury attorney.

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