attorney "acting on your behalf" on insurer's instructions
- Thread starter odie999
- Start date
I think you need to provide more information or flush out your hypothetical situation to get a proper response. Are you speaking about the scenario where you sued and accused of being at fault for something (e.g., personal injury to another person) and your insurance company hires a lawyer to represent you?
Generally your best interests and your insurance company's best interests line up closely enough that the issue of a possible conflict does arise.
When a conflict does arise the obligation is on the lawyer to spot the conflict and deal with it. The more common types of conflicts are where the insurer does not want to pay out a dime but but there is real risk that a judgment in court could exceed your policy limits - thereby exposing you and your assets to personal risk if the insurer directs the lawyer to reject a pre-trial offer below policy limits and then loses at trial. In a case such as this one you are supposed to be encouraged to hire your own independent lawyer to represent your interests against the insurance company.
The biggest "check" on insurance companies is the threat of a lawsuit alleging breach of a duty of good faith if they make a reckless decision that needlessly exposes you to personal financial risk.
Generally your best interests and your insurance company's best interests line up closely enough that the issue of a possible conflict does arise.
When a conflict does arise the obligation is on the lawyer to spot the conflict and deal with it. The more common types of conflicts are where the insurer does not want to pay out a dime but but there is real risk that a judgment in court could exceed your policy limits - thereby exposing you and your assets to personal risk if the insurer directs the lawyer to reject a pre-trial offer below policy limits and then loses at trial. In a case such as this one you are supposed to be encouraged to hire your own independent lawyer to represent your interests against the insurance company.
The biggest "check" on insurance companies is the threat of a lawsuit alleging breach of a duty of good faith if they make a reckless decision that needlessly exposes you to personal financial risk.
there was an accident and I might be sued for negligence - somebody else was driving a car I own.and your insurance company hires a lawyer to represent you?
you cant be sued for negligence unless the driver killed or permanently injured someone. 4tees is right though your insurance co will cover the bill for your lawyer. If you are unsure about your liability coverage on your car its most likely 1 or 2 million and that doesn't include the lawyer.
Odie999, Usually the greatest likelihood for conflict is that your Insurance Company wants to settle and you wish to continue litigation with the expectation of being exonerated (in which case since the insurance company is paying the bills. . . . )
Otherwise, to the best of my knowledge the Upper Canada Bar Rules are the same as where I am: Your lawyer although being paid by the insurance company, represents you the insured and is obligated to act in the best interests of his or her client which is you the insured.
Otherwise, to the best of my knowledge the Upper Canada Bar Rules are the same as where I am: Your lawyer although being paid by the insurance company, represents you the insured and is obligated to act in the best interests of his or her client which is you the insured.
Had not considered that angle. Thanksyour Insurance Company wants to settle and you wish to continue litigation . . . )
This isn't really correct. You can be sued anytime, anywhere by any number of nut jobs. It is more accurate to say that you can't be sued successfully unless the driver killed or permanently injured someone or caused them to suffer economic loss that they were not compensated for by way of a collateral insurance policy.you cant be sued for negligence unless the driver killed or permanently injured someone. 4tees is right though your insurance co will cover the bill for your lawyer. If you are unsure about your liability coverage on your car its most likely 1 or 2 million and that doesn't include the lawyer.
This is why we have insurance. They cover the cost of defending you regardless of whether the action has merit or not.
It is a possibility but you should know that the size of any potential settlement is not likely to effect your rates. Whether the driver in question was at fault for the accident and to what extent they were at fault, in they eyes of the insurer, will be determined by Ontario's fault determination rules. Any settlement in advance of trial is going to include a provision that there is no admission of liability so you would have to think really hard about why you would want to resist an insurance company settling a claim when the settlement is going to have virtually no impact on you.Had not considered that angle. Thanks
Insurance companies are motivated by minimizing their costs when settling a claim.
You are motivated by reducing your lifetime costs and avoiding being held accountable for something you did not do.
An insurance company will often agree to settle a claim against you if the cost of fighting the claim (even to eventual success) approaches or exceeds the cost of the settlement. The result to the insurer is a quick resolution with a fixed cost. The result to you is the reputational impact of the insurer deciding that you will accept blame and, potentially, a lifetime (or years, at lest) of higher premiums because you have now been held responsible for a significant claim.
Anyone that cannot see the significant divergence of interests between these positions is not paying close attention.
You are motivated by reducing your lifetime costs and avoiding being held accountable for something you did not do.
An insurance company will often agree to settle a claim against you if the cost of fighting the claim (even to eventual success) approaches or exceeds the cost of the settlement. The result to the insurer is a quick resolution with a fixed cost. The result to you is the reputational impact of the insurer deciding that you will accept blame and, potentially, a lifetime (or years, at lest) of higher premiums because you have now been held responsible for a significant claim.
Anyone that cannot see the significant divergence of interests between these positions is not paying close attention.
yeah, I don't know any details yet, it's just been done through the insurers so far but it looks like injury and losses are being claimed.
you can't be sued successfully unless the driver killed or permanently injured someone or caused them to suffer economic loss that they were not compensated for by way of a collateral insurance policy.
This is why we have insurance. They cover the cost of defending you regardless of whether the action has merit or not.
Not my concern at all. If I need to save money I've lived long periods with no car (am doing so right now), my concern was being held liable for some large sum over and above the insurance coverage ($2 million).the size of any potential settlement is not likely to effect your rates.
OR the insurer finding a way out of paying - bad paperwork or something ... leaving me holding the bag. Guess I'm just too pessimistic and suspicious of corporate types, and the legal system, only having read / seen reporting on the worst cases.
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This is simply not accurate. There is no "reputational impact" of a settlement. The insured person does not "accept blame" if there is a settlement. The insurance company pays money out and the person claiming the money signs a release that specifically states that there is no acknowledgement of liability. The insured person doesn't sign anything and there is nothing to suggest that they, in any fashion, "accepted blame" for the accident. The notion that insurance companies settle cases based strictly on evaluating the cheapest way to extract themselves from the claim is not a news flash; it is self evident to anyone with half a brain. This makes the "reputational impact" of a settlement even more remoteThe result to you is the reputational impact of the insurer deciding that you will accept blame and, potentially, a lifetime (or years, at lest) of higher premiums because you have now been held responsible for a significant claim.
Anyone that cannot see the significant divergence of interests between these positions is not paying close attention.
Whether you pay higher premiums in Ontario is based strictly on the fault determination rules, which are government regulations. In assessing your rating as a driver insurance companies look at the number of at fault collisions you are responsible for - not the number or size of settlements made on your behalf. The decision as to whether you were "at fault" for a collision is made almost immediately - it does not depend on the outcome of any lawsuit. It is strictly based on the orientation of the cars at the time of the collision; see here:
www.e-laws.gov.on.ca/html/regs/english/elaws_regs_900668_e.htm
Finally, there is not a "significant divergence of interests" - you are paying your insurance company to insure your financial assests. You are not paying them to insure your reputation. Whether there is a settlement or not and the size of the settlement does not impact your rates - the impact on your rates is based on whether you are determined to be "at fault" for the collision.
More often than not, your financial interest and the insurance company's financial interests will align. On those occasions when they don't, as Aardvark pointed out, the lawyer hired by the insurance company to represent you has a professional responsibility to advise you and protect your interests.
Lots of guesses not much knowledge.
The lawyer the insurance company hires to represent you, has to do just that, represent and defend you up to the limits of the insurance policy.
If you have over limits exposure than you need to hire your own lawyer to do two things:
a) represent you on the over limits exposure;
b) make sure the insurance counsel is doing their job right and not increasing your risk.
As long as the settlement is within the policy limits the insurer can settle the claim anyway they damned well please. The size of the settlement they enter into will not impact your rates.
This is of course unless defend you under limitations...like a waiver of rights etc.
However if the amount sought in the claim in more than your limits, you should hire your own lawyer and your insurance counsel should reccomend that course of action to you.
Once your insurer appoints your counsel, let me know pm me who it is and assuming you are in Ontario I can give you the rundown on them.
The lawyer the insurance company hires to represent you, has to do just that, represent and defend you up to the limits of the insurance policy.
If you have over limits exposure than you need to hire your own lawyer to do two things:
a) represent you on the over limits exposure;
b) make sure the insurance counsel is doing their job right and not increasing your risk.
As long as the settlement is within the policy limits the insurer can settle the claim anyway they damned well please. The size of the settlement they enter into will not impact your rates.
This is of course unless defend you under limitations...like a waiver of rights etc.
However if the amount sought in the claim in more than your limits, you should hire your own lawyer and your insurance counsel should reccomend that course of action to you.
Once your insurer appoints your counsel, let me know pm me who it is and assuming you are in Ontario I can give you the rundown on them.
In Ontario, the real area where you can get conflicts of interest are when you collect "accident benefits" from an insurer who's not your won. for example, I do not have a car, if I get injured by a driver. I would claim against his policy for lost income etc.. under the 'accident benefits section of his policy. If my injury is serious and permanent I can also sue him as well, hiring my own lawyer. The insurer is screwed though as they have a duty to pay me under their client's AB coverage and to defend him from my suit and not to let the 2 hands know what's happening.
Otherwise, as said earlier, the amount paid by an insurer on your behalf will not effect your rates. But the frequency that they must pay and the circumstances of your responsability will. They also have the duty to defend you against all claims of negligence that fall within the wording of the policy.
What liability coverage is paying to hire the insurance company's counsel to defend you. If you are unhappy with the manner of the insurer's defence, you can handle the claim yourself but your insurance will be invalid. I recall insuring a cabinet minister back in the 80's who lost control on a downhill slope and ran into a fire hydrant, breaking it off and causing a small scale flood. As his insurer, we were going to settle with the city and the effected property owners. This wingnut insisted that it was the city's fault for putting the hydrant where it was and insisted that he was not responsible. After a whole lot of dialogue and corresponce back and forth, we indicated that if he wanted to pursue this defence he was on his own and that his coverage would be invalid.
Fortunately, he came to his senses and let us settle the claim on his behalf before he made an ass of himself.
Otherwise, as said earlier, the amount paid by an insurer on your behalf will not effect your rates. But the frequency that they must pay and the circumstances of your responsability will. They also have the duty to defend you against all claims of negligence that fall within the wording of the policy.
What liability coverage is paying to hire the insurance company's counsel to defend you. If you are unhappy with the manner of the insurer's defence, you can handle the claim yourself but your insurance will be invalid. I recall insuring a cabinet minister back in the 80's who lost control on a downhill slope and ran into a fire hydrant, breaking it off and causing a small scale flood. As his insurer, we were going to settle with the city and the effected property owners. This wingnut insisted that it was the city's fault for putting the hydrant where it was and insisted that he was not responsible. After a whole lot of dialogue and corresponce back and forth, we indicated that if he wanted to pursue this defence he was on his own and that his coverage would be invalid.
Fortunately, he came to his senses and let us settle the claim on his behalf before he made an ass of himself.
Oh, you mean the car that you never gave them permission to drive and they must have taken the keys when you weren't looking!there was an accident and I might be sued for negligence - somebody else was driving a car I own.
where did you read in my posts I never gave them permission or they took the keys while I wasn't looking? I hope I didn't imply any of this.Oh, you mean the car that you never gave them permission to drive and they must have taken the keys when you weren't looking!
If any of that were the case I would not be so concerned.
