What Can I Do If My Insurance Company Is Being Unreasonable?

What Can I Do If My Insurance Company Is Being Unreasonable?

In the case of Nibert v. GEICO, the Colorado Court of Appeals answered questions about a plaintiff’s remedies when the plaintiff’s insurance carrier in an underinsured motorist (UIM) bodily injury claim was found to have unreasonably delayed paying UIM benefits. Please feel free to visit our page on UIM coverage to learn more about those benefits.

Nibert was injured when a car collided with her motorcycle. To help cover her damages, that exceeded the amount of insurance coverage the at-fault driver had, Nibert made a claim against her insurance company, GEICO, for the available $25,000 in coverage provided by her UIM policy. In response to her demand, GEICO offered her $1,500 to settle her UIM claim against them. Due to Geico’s unreasonableness, Nibert had no other remedy but to sue GEICO for breach of contract, acting in bad faith, and unreasonably delaying and denying her benefits. Before trial, but after months of litigation, GEICO agreed to pay Nibert the $25,000 in UIM coverage to settle the breach of contract claim against them. However, Nibert argued she still had claims against GEICO for unreasonably delaying the payment of those benefits. After trial, a jury determined that GEICO unreasonably delayed her UIM benefits, and the court awarded Nibert $50,000 for damages on the unreasonable delay claim and $118,875.30 in attorney’s fees.

The statute that applies to circumstances where an insurance company unreasonably delays or denies benefits allows a plaintiff to receive “two times the covered benefit” and attorney’s fees as damages due to an insurance carrier’s unreasonable delay or denial of benefits. In Nibert’s case, GEICO argued on appeal that it should receive an offset against the $50,000 awarded to Nibert because Geico had previously paid $25,000 to Nibert, but the Court of Appeals disagreed, and ruled that GEICO had to pay $50,000 to Nibert, in addition to having already paid the $25,000 UIM policy limits to her before trial.
GEICO also disputed the amount of attorney’s fees it owed Nibert under the statute. GEICO claimed that the calculation of attorney’s fees should have stopped when it paid Nibert the $25,000 after the lawsuit was filed. Again, the Court of Appeals disagreed and upheld the total amount of the attorney’s fees that Nibert incurred to take her case through trial.

Nibert’s case is good for plaintiff’s because it lets insurance companies know that they can still be liable for damages for unreasonably delaying benefits, even if they ultimately, but untimely, pay those benefits. The experienced attorneys at Mintz Law Firm can help you deal with unreasonable insurance companies, so call today for your free initial consultation.

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