The Harper Law Blog
The Harper Law Blog offers news, announcements, thoughts and articles on life, law and our practice areas of emphasis.
What does a fiduciary relationship mean in the insurance contract setting?
Posted Saturday, August 25, 2007 by Ed Harper.
As stated in earlier postings, an insurance company owes their insured a duty to act in good faith. These are obligations established by laws which have come about through our history of English common law or statutory enactments. These are to protect one from injuring another, also known as tort law.
Contractual obligations, on the other hand, occur because of promises made by the parties who have entered into a contract. The contract of insurance governs the responsibilities of both the insured (the policy holder) and the insurer (the insurance company).
Thus, insurance companies have obligations which arise from both legal obligations and contractual obligations. These responsibilities blur to some extent, and ascertaining the legal implications of the insurance company’s actions often requires legal representation. However, it can be assumed the insurance company is prohibited in acting in a way that is detrimental to its insured.
Therefore, courts have noted that there is a fiduciary relationship that exists between an insurance carrier and an insured. In the typical setting, a fiduciary relationship is established when one holds property or something of value for another. It stems from the days of Rome and the Latin word fiduciarius “(holding) in trust “and from fidere” to trust”.
The insurance company is not a true fiduciary for the insured, but the company must “give equal consideration” to the insured’s interest, as well as its own.
Insurer's Duty of Good Faith
Posted Tuesday, August 07, 2007 by Ed Harper.
An insurance company must act in good faith towards its insured. The insured is the individual or company who has been paying premiums. Their is a contractual relationship between the insured and the insurance company. There also are tort “duties” the insurance company as well as the insured to act in good faith.
According to the Washington Pattern Jury Instructions “an insurer has a duty to act in good faith. This duty requires an insurer to deal fairly with its insured. The insurer must give equal consideration to its insured’s interests and its own interests. An insurer who does not deal fairly with its insured fails to act in good faith. In proving that an insurer failed to act in good faith, an insured must prove that the insurer’s conduct was unreasonable, frivolous, or unfounded. The insured is not required to prove that the insurer acted dishonestly or that the insurer intended to act in bad faith.”
If insurance coverage is an issue, the insurer’s duty requires the company to conduct a reasonable investigation regardless of the ultimate conclusion regarding coverage. What is a reasonable investigation depends on the situation and the claim. We will visit what a reasonable investigation looks like in the next blog entry.
False Assumption - 10. I will obtain full compensation
Posted Friday, August 03, 2007 by Ed Harper.
I will obtain full compensation, including all my lost income, because the accident was not my fault. One can hope for the best, but must be prepared for the worst. Obtaining a settlement that fully compensates someone for a collision is a rare occurrence. However, with the right guidance and counsel, one can properly prepare a claim for the best possible outcome. Compensation can be demanded and obtained ~ but be ready for a battle. There are several factors which must be considered, including the following:
-Proving liability for the collision;
-Proving that the medical treatment was reasonable and necessary; and
-Proving the wage loss through independent verification.
Obtaining a fair settlement is possible. However, one should consult with counsel and staff at Harper Law, PLLC. We are ready and willing to serve your best interests. Our firm will provide wise counsel and will advocate strenuously for you. We will treat your claim as if it was our own. Having an attorney in your corner is not only a good thing – it is essential to recovering the maximum potential recovery.
False Assumption - 9. My neighbor settled her own claim
Posted Tuesday, July 24, 2007 by Ed Harper.
My neighbor settled her own claim and obtained a good settlement. Many individuals think that perhaps a friend or relative can assist in the settlement of their personal injury claim. Maybe your loved one believes they successfully settled a claim previously without the assistance of an attorney, or perhaps they used to work for an insurance company. However, while they undoubtedly have good intentions, they can’t really know how successfully they’ve resolved their claim as they don’t have any data with which to compare the results of their settlement! Insurance companies are not in business to be “fair”. They are in business to make money. No one should advocate for another person unless they are licensed to practice law. Let me say it again ~ insurance companies are in business to make profits. It’s that simple.
The insurance companies handle thousands of claims annually. It is vital that you seek and obtain a very knowledgeable attorney who has the experience to represent your interests against the interests of the insurance company. You should be represented by that attorney as if the attorney was representing a family member or loved one. That is our goal here at Harper Law.
We know what we are doing; and equally important, we really care about what an injured person is going through ~ medically, emotionally, and legally. We strive to make the legal experience one in which you feel comfortable and confident in our ability to provide information and direction along the way and to provide realistic and accurate assessments of your claim throughout the process.
False Assumption - 8. All my medical bills will be paid
Posted Tuesday, July 24, 2007 by Ed Harper.
All my medical bills will be paid because someone else is at fault. For an auto accident, the initial insurance you must look to for help in paying for medical treatment is your own automobile insurance. In the State of Washington, we have Personal Injury Protection (also known as PIP) offered with our auto insurance. Provided one is injured in an accident related to a motor vehicle, PIP will assist in providing medical care for an amount that is typically $10,000. Additionally, payment for loss of services (i.e. help with housecleaning, etc.) and wage loss benefits may also apply.
If someone has chosen not to purchase PIP (see my earlier post for more detail on the benefits of PIP!), health insurance can be utilized for payment of the medical bills. If and when a claim against the at-fault driver is settled, you have the obligation to pay back the PIP and/or health insurance company through the contractual provision called subrogation. Subrogation means that an insurance company that paid your bills can expect to be reimbursed for what they have paid out from your personal injury recovery. At Harper Law, we will handle the subrogation reimbursement with your insurance to ensure you receive as much money as possible from your settlement.
If you do not have PIP or health insurance, a health care provider may be willing to take a lien on the personal injury settlement or accept a letter, such as a Promise to Pay, allowing payment at the conclusion of the case. Sometimes a lien or Promise to Pay will be the only means an injured person has in which to obtain the much needed medical care. However, before you sign a lien or Promise to Pay, you must understand that the health care provider will then hold an interest in your personal injury claim; and you are then responsible to see that they are paid in full at the conclusion of your claim.
The third party insurance company (also known as the “at-fault insurance company”) will not provide you with any benefits (except in unusual situations) unless you are willing to sign a full release of liability, preventing you from bringing a claim for your injuries.
Do not sign a release. Let me say it again ~ do not sign a release of liability unless you have consulted with an attorney.
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