Maryland Court of Special Appeals Addresses Insurer’s Liability in Car Accident Case

The Maryland Court of Special Appeals examined the matter of underinsured motorist coverage and setoff amounts in a recent opinion concerning a car crash case, Allstate v. Kponve. In Allstate, the insured was involved in a motor vehicle accident and brought suit against the other driver, alleging that his negligence resulted in a severe injury to her. Her insurance company, Allstate, filed a motion to intervene in the lawsuit, contending that the other driver was likely an underinsured motorist and that Allstate may be bound by a judgment entered against him. The motion was granted. Allstate’s insured subsequently settled with the tortfeasor’s insurance company for his policy limits of $25,000, leaving Allstate as the remaining defendant.

After a trial, the jury found that the insured was not contributorily negligent, that the other driver caused the insured’s injuries, and that as a result of the accident, the insured suffered damages in the amount of $374,000. Allstate filed a motion to amend the judgment, requesting the court to reduce the judgment to $25,000. Allstate alleged that its insured’s policy had an underinsured motorist limit of $50,000 per individual, which should be reduced by the $25,000 settlement from the tortfeasor’s insurer. The trial court denied the motion, and Allstate appealed. On appeal, the court addressed the issues of whether the insurance company had the burden of proving the amount of underinsured motorist coverage and the amount of credit it was entitled to receive as the result of the settlement by the tortfeasor’s insurance company, if any.

The court noted that Allstate was never sued directly in contract, but only as a result of the tort case brought by its insured against another driver. Therefore, the court held that as an intervening party in a tort case such as this, Allstate did not have the burden of proof as to contract damages, nor the burden of proving the amount of its policy limits, nor the amount of the credit to which it was entitled based on the settlement received by its insured. The court’s reasoning was that, since the insured never alleged any tort against Allstate, whether in contract or otherwise, the judgment did not have the effect of establishing the amount of money Allstate owed the insured under her insurance contract. Nevertheless, if a later contract action were brought by the insured directly against Allstate, Allstate could not contest the fact that its insured suffered $374,000 in damages as a result of the sole negligence of the other driver. Its insured, however, would have to prove the amount of her damages under her policy. In the interest of judicial efficiency, the court remanded for proceedings to determine whether the insured disputed or admitted to the amount of underinsured motorist limits under her policy, the amount of the settlement, and the difference between the two.

The Maryland attorneys at Foran & Foran, P.A. represent victims in personal injury claims, including car accidents, medical malpractice cases, and others. We routinely deal with insurance companies on behalf of our clients to obtain the coverage and compensation that they are entitled to, in addition to seeking damages from negligent drivers. To discuss your case with one of our experienced attorneys, contact us at (301) 441-2022 or online.

More Blog Posts:

Maryland Court of Appeals Upholds “Gap” Insurance Policy in Pedestrian Accident Case, Maryland Personal Injury Blog, published October 31, 2015

Maryland Auto Insurance Policy Lapses Day Before Fatal Accident; Court Provides No Relief to Driver, Maryland Personal Injury Blog, published October 6, 2015

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