My name is Barry Zlotowicz and I am a Personal Injury Attorney In Chicago. I often get asked by clients “can I sue the insurance company?” In this article, I will address this common question and also briefly discuss when you can in fact sue an insurance company. If you are involved in a dispute with an insurance company, call me today at 847-305-4105 for a free consultation.
Who do you sue?
Auto insurance companies can be very difficult to deal with. The insurance company has one goal – to make money. They do this by taking in as much in premium payments as they can while at the same time paying as little as they can for insurance claims.
As such, it should be no surprise that the insurance company will nickel and dime you to every extent possible to save money. They know that the likelihood of someone filing a lawsuit against them is small – the vast majority of cases settle. Few people will file a lawsuit over a couple hundred dollars in property damage.
This often leads to serious frustration when dealing with an insurance company after an auto accident or other personal injury accident in Chicago. I have received many calls from people who ask: “can I sue the insurance company?”
The answer is….
As an Illinois injury lawyer, I’m very familiar with insurance company tactics. But generally speaking, no matter what the insurance company does, you do not sue the insurance company directly for injuries and damages suffered in an auto accident. Rather, you sue the person who hit you.
Let’s say you are involved in an auto accident with a “John Smith.” Mr. Smith rear-ended you while driving on the Kennedy Expressway. Mr. Smith is insured by Geico Insurance. After the accident, you obtain Mr. Smith’s auto insurance information. You file a claim with Geico and after you finish treating you demand $25,000 to settle your case. Geico offers you only $10,000. You are not happy with the offer. What do you do?
In short, your Illinois personal injury lawyer will file a lawsuit against John Smith, not Geico Insurance. Geico has a duty to defend Mr. Smith. Therefore, once Mr. Smith is served with your lawsuit, he will call Geico and Geico will pay for a law firm to represent Mr. Smith.
When do you sue the insurance company?
The only time you will hear your Illinois injury lawyer talk about suing the insurance company is when he or she alleges that the insurance company is acting in “bad faith.” It’s a term that’s thrown around a lot by people but as applied to auto insurance claims, it is not used that often.
In short, a bad faith claim in this context usually arises when an auto accident victim files a claim against the defendant driver and there is a reasonable probability that the recovery will be in excess of the insurance policy. Despite this, the insurance company refuses to “tender” or offer the entire insurance policy to settle the case.
If your Illinois injury lawyer files a lawsuit on your behalf and you win an amount in excess of the policy amount, you may be able to file suit against the defendant’s insurance company and recover the entire amount of the verdict plus attorney’s fees and more.
If you want to read more about this topic and the standard for a bad faith claim, check out the Illinois Insurance code 215 ILCS 5/155.
Practical use of bad faith
Most of the time I have used this allegation is when an insurance company engages in significant delays in responding to a demand letter or other request for compensation. In that case, I will send a letter to the insurance company subtly suggesting they are acting inappropriately. An insurance company is usually fairly quick to respond to such a letter. However, this is normally a last resort.