Insurance coverage plays a large part in what a case is worth. If the person that causes the accident only has limited coverage, like $10,000 of bodily injury coverage in a car accident, even if your injury is worth more than that, the insurance may be the only monies that you are able to recover. Thus, there can be the “legal” value of a case (which is the true value, based on what a jury awards you) and then there can also be the “practical” value of a case based on limited insurance. If in a case that is worth $25,000 but all the available insurance is $10,000, while the case is worth $25,000 sometimes all that you are able to collect from insurance is $10,000, the insurance that is being offered in full. While you can go to court and have a jury award you the full $25,000, all the insurance legally owes is $10,000 and then you would have a judgment against the other driver for $15,000 that is owing after the insurance pays. If the other driver is “judgment proof,” meaning that if sued, he could file for bankruptcy or otherwise not able to collect the owing monies based on the individual’s financial situation, then practically speaking all the case is worth is really $10,000.00.
There are some situations where an insurance company may owe more than their policy, like if they are deemed in “bad faith.” However, that is a rare situation and “bad faith” is a particularly complicated aspect of the law and is difficult to apply absent knowing all the facts of a case. Thus, it is important to go over these scenarios with your lawyer.
