Dealing with Non-Standard Insurance Companies

One of the main factors that goes into determining whether or not you have a “good case”, after getting into a car accident, is the quality of the insurance company that the person who caused the accident has. The exact same accident claim will have two completely different values depending on the insurance company paying the claim.   If you happen to get into an accident with someone who has non-standard auto insurance, be prepared for a long, drawn out experience while trying to get compensated for your loss. Usually, non-standard companies issue policies for the state minimum, which in Illinois is $25,000.00. This becomes an issue when your damages and pain and suffering exceed $25,000.00 as that is the maximum amount that the company will pay out on your claim. If you wish to obtain more money than the policy limit, you will be forced to use your own underinsured motorist coverage (assuming that it is more than $25,000.00), or to file a lawsuit against the driver in hopes that that person has money in the bank above and beyond the $25,000.00 that their insurance company will cover. In addition to policy limit issues, it is very common for non-standard insurance companies to not return phone calls, ignore letters, play games with you and make the process one big headache. Negotiating settlements with these non-standard companies is also a headache in as much as it is very difficult to get the claims adjusters to pick up the phone and to return voicemail messages and emails. These companies will usually value a claim at a lesser value than the claim is actually worth forcing you to either settle your claim for a discounted amount, or to file a lawsuit and wait 3-5 years to get your money. This strategy seems to work well for these companies as this enables them to hold on to their money for a longer period of time. Often times, people will just decide to drop their claim because they do not want the hassle of having to put their case into Court and wait a long time to get their money. This is a win for the insurance company. Some people will choose to settle their claim on the cheap, which is also a win for the insurance company. If you have a legitimate claim, and the non-standard insurance companies offer is way below the actual case value, I recommend filing a lawsuit. If the offer is just slightly below the actual case value, I usually recommend settling the claim so as not to have to deal with the delays associated with filing a lawsuit. At the point where the company extends an offer, I always tell my clients to put their personal feelings aside and look at it strictly as a business decision. Is the risk/reward of filing a lawsuit great enough to spend the money and wait the 3-5 years, or is the offer sufficient enough where a bird in the hand is worth two in the bush? 

The main thing that you can do to safeguard yourself from having to suffer through endless headaches dealing with non-standard insurance companies is to make sure that you carry quality insurance on your vehicles. This way, even if you are unfortunate enough to get into an accident with someone who has non-standard insurance, assuming that you have full coverage on your own policy, you can always go through your own company to cover the property damage and medical expenses and let them subrogate (go after), the at fault party’s insurance company to recoup their money. When this happens, in the end, your insurance company will be made whole and thus they should not increase your premium. Also, handling your claim this way means that you will not have to try to get someone on the phone from the non-standard company to assist you with your claim. While $25,000.00 is the state minimum requirement for auto insurance, it is always better to have more coverage so that if you happen to get into an accident where it is your fault, you will then be covered for the other person’s damages for a larger amount and will not have to worry about being sued personally.