Court Reads Insurance Policy to Limit Total Recovery in Accident Involving Underinsured Motorist

Earlier this year, a federal court of appeals issued a written opinion interpreting the language of a contested insurance policy in favor of the insurance company, thus limiting the total amount of recovery among the three injured parties to $500,000. In the case, Trotter v. Harleysville Insurance Company, the court determined that the insurance company that carried an underinsured motorist policy for one of the victims involved in the accident was not required to pay out on the claim, since the at-fault party’s insurance policy provided the same limit.

The Facts of the Case

This case involves a single accident between two vehicles. Powers was the at-fault party, and he had an insurance policy that covered damages up to $250,000 per person or $500,000 per accident. The driver of the other car, Trotter, as well as his two passengers, Jackson and Petrie, were all injured as a result of the accident. All the injured parties filed claims against Powers’ insurance company.

The injured parties all entered into a settlement agreement with Powers’ insurance company, whereby Trotter would receive $250,000, Jackson would receive $238,000, and Petrie would receive $12,000. However, after the settlement, the parties asserted that the recovered sum failed to make them whole. So they filed a claim under Trotter’s insurance company, the defendant in the case.

Trotter’s insurance policy provided for a $500,000 limit for underinsured motorist protection. The limit was a “per accident” limit. However, Trotter’s insurance company denied all claims made against it. The company argued that since Powers had an insurance policy with a limit of $500,000, which is the same limit as Trotter’s policy, Powers was not an underinsured motorist. Since Powers was not an underinsured motorist, the injured parties did not have a right to recover under Trotter’s underinsured motorist policy.

The court hearing the case listened to each side’s arguments. The plaintiffs claimed that the $500,000 underinsured motorist limit on Trotter’s policy should be interpreted to be a per-person limit, and since Powers’ policy was a “per-accident” limit, Powers was technically underinsured. The defendant insurance company argued that the policy language was clear and that it allowed for a recovery amount, in total, for each accident of $500,000.

The court ultimately determined that the defendant’s reading of the policy was correct, and it dismissed the lawsuit against the insurance company. The plaintiff, therefore, will be stuck with the amounts they recovered under Powers’ policy.

Have You Been Injured in a Maryland Car Accident?

If you or a loved one has recently been injured in any kind of Maryland car accident, you may be entitled to monetary compensation. However, as you can see from the discussion above, dealing with insurance companies in the wake of an accident can be incredibly frustrating. Therefore, it is best to have an experienced advocate on your side to help you understand the nuances of the policies involved and how you can maximize your chances at a full recovery. Call 410-654-3600 today to set up a free consultation with a dedicated Maryland car accident attorney.

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Doctors Must Obtain Informed Consent Before Performing Any Operation or Procedure, Maryland Accident Law Blog, May 9, 2016.

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