Trial lawyers tell people’s stories.   Over my decades in practice I have learned and told the stories of people experiencing loss and grief.  I have been thinking about how they have experienced these cases.

Without an epistemological debate on the origin or nature of consciousness, there is a lived experience of consciousness that rings true.  Our self is a story we tell ourselves about ourselves.  The stories parties to mediation have experienced, plaintiff or defendant, are traumatic and this trauma informs the story they tell to their lawyers.

What, then, is the perspective of the party in the mediation.  They are processing the experience as a retelling of their story and chance at closure.  Jerome Bruner, a pioneer in cognitive psychology, argued that there are two modes of thought, the paradigmatic and the narrative.  Paradigmatic thought is essential for discovering objective truth.  Narrative thought is what places the individual and their lived meaning in context in the world.

Paradigmatic thought functions through categorization, logic, and empirical evidence. This mode of thought is focused on creating theories, conducting analysis and gathering data, and establishing logical proofs. It is the foundation of scientific inquiry and mathematical reasoning, where the goal is to uncover universal truths through hypothesis testing and systematic investigation.

To the extent humans are logical animals, this is the thought process that underlies it.  Why, then, do lawyers lose cases when they have meticulously set forth evidence to support each element of their claim?  Most trial lawyers will tell you that this is because humans are not predominantly logical.  I have found that when you need someone to see a new point of view, it is very difficult to do with logic alone.

Narrative thought helps us understand the world by organizing our experiences into characters, intentions, and outcomes.  This storytelling process is a primary part of human thought as events are analyzed and categorized within our framed narrative.   This is what helps people to make meaning and sense of the events around them.

All parties to the mediation are likely to have a version of events that is distorted by assumptions in their narratives.  This can lead to distortions of the truth that prevent them from seeing other potential perspectives in the case.  They can also obscure objective truth.  When you cannot move a party away from the mistaken parts of their narrative, mediation becomes a competition of narratives rather than an exercise of narrative harmonization.  There is nothing inherently wrong with a battle of narratives, that is the trial lawyer’s stock in trade.  When the goal is to bring the parties together to settle their case, though, everyone needs to at least understand the other perspective.

In mediating conflict or a case, I start from the central proposition that resolution is most likely to occur when everyone has a roughly similar agreement on the facts that the jury will believe are true.

In order to harmonize perceptions, the mediator starts by listening to the party’s story and showing you understand their perspective.  You will be charged, after all, with conveying it in the other room.

The parties’ versions of the facts should already be known at this time from the briefs.  When you are listening to the party explaining their version of events, you are also gaining an understanding of the narrative framing of the story.  What role does the party in front of you play in their story?  What role have they cast for the other party?  What aspects of the story are injecting the most emotion into the narrative?  Where does the story seem to diverge from the evidence or objective truth?  From this analysis, you try to identify leverage points where the party can start to see that their version of the facts is not the only possible version.  You do not start, however, with presentation of inconsistent evidence.  “Let me tell you why you’re wrong” will only serve to entrench the party in their narrative.

One technique to help expand the narrative is to ask the party to explain how they think the other party sees the events.  By asking them to view the same story from outside their narrative, they internalize the fact that there are (at least) two sides to every story.

Framing involves altering the way parties perceive and interpret their conflict.  I have found that the best way to objectively frame the story is from the point of the view of the jury.  Talking about what the jury will believe does not attack their narrative but, rather, seeks a recognition that the jury will be hearing and weighing competing narratives.  You can ask them whether or not someone could believe certain propositions and use examples of people expressing similar beliefs to show that jurors will bring their own perspective to the trial.  They may be “right” about what happened, in other words, but the skill of the attorneys, preconceptions, bias, or evidence may lead the jury to reach a different conclusion.

This re-framing of the narrative as a set of facts that will be decided by twelve strangers allows the mediator to discuss various hypotheticals about what the jury may believe.   The party can accept this truth without having to acknowledge the failings in their logic or perception.  In transformative mediation, you are seeking genuine recognition of the other party’s story and a healing of their intersubjective trauma.  For the purposes of civil mediation, it is sufficient to convince the party that the jury may see the story differently than they do in order to bridge gaps of perception.

 

As a practicing personal injury attorney, one of the realizations I made in my career is that grief plays a significant role in the way clients perceive and relate to their cases.  The legal process I help them through is a way to come to terms with what they are experiencing and, ultimately, finding meaning in the loss.  More times than I can count, I have used the phrase, “There’s a reason they call me counselor.”  As an attorney studying and practicing mediation, I wanted to bring some of these insights and experiences to bear on the role of the mediator.   These techniques are not proper for every mediation.  These principles are helpful where the litigant seems to be overly oriented to the past or preoccupied with their loss or blame.

Grief is not limited to the loss of a loved one.  The image in many people’s minds of grief is the wailing widow, veiled in black.  Though death is the ultimate loss, grief takes many forms.   When an injury takes a part of your life or autonomy away, that loss is grieved.  There is a “death” of the person that you were before the injury.  Resolution of that grief is a focus on the rebirth that can follow.  As a practice pointer for attorneys when your client is obviously having difficulty processing their loss, I strongly encourage you to offer any assistance you can give but also to be cognizant of when a mental health professional is needed.  Either at mediation or at trial, a client actively processing their grief will have difficulty with the legal process.  That being said, a mediator that is open to working with grieving litigants can help provide a framework for healing.

Many people are aware of the “Five Stages of Grief.”   Elisabeth Kubler-Ross first proposed this framework in her 1969 book “On Death and Dying.”  She postulated that those contemplating death and, by extension, experiencing grief experience 1) denial, 2) anger, 3) bargaining, 4) depression, and 5) acceptance.  This is known as the DABDA model.  A common misconception is that these stages progress in a linear fashion.  There is an idea that one moves through the stages to a permanent state of acceptance.   That is not the case.  First, it is not healthy to tell someone that they can “overcome” or “be healed from” their grief.  Their grief will always be with them and a healthy relationship with grief honors it too much to ever discard it.  I have an injury client who lost his wife decades ago.  He goes to visit her grave every year on the anniversary of her passing.  I’ve talked with him about this framework, and he relates that all of the stages come back to him at the cemetery.   People alternate and “regress” through the “stages” over time.  People are also much more complex than any five-stage model.  These behaviors/emotions, however, are a valuable framework for understanding the reactions to grief and helping people enter an emotional state that is conducive to settlement.

Denial is often strongest before I meet a client as a lawyer and likely to be weakly expressed when I come into the picture as a mediator.  A person in full-blown denial is not likely to take any action to change a situation they are not acknowledging.  It can reappear as grief is processed, however.  In my experience, this most commonly takes the form of avoidance.  Clients will be slow to respond to requests or avoid thinking about the case.   Grief isn’t always the cause of this client behavior, but I think it plays a major role.  I address this symptom with what I call “caring confrontation.”  For the mediator, you cannot shy away from talking with the injured parties about what they have lost and even drawing out information they seem reluctant to share.   There are schools of thought that raising the issue of loss will impede settlement.  That may be the case if the litigant has clearly processed the loss and is prepared to engage in a business transaction.  If that is not the case, the hesitancy to address the loss will leave it lurking in the background.  This unspoken issue will affect decision making in ways that will be hard to decipher.   By listening to and affirming these losses, the litigant becomes aware that you understand their interests.  By expressing them, they can begin to work toward orienting to a future that includes the loss but is not controlled by it.

Anger is usually dominant when I first meet injury clients as an attorney.  They believe that their loss is someone else’s fault, and they reach out to a lawyer to help them hold the perceived wrongdoer accountable.   Anger is probably the most difficult aspect of grief for the personal injury attorney to deal with.  It is a motivation to seek justice, and is often justified, but it also stands in the way of rational evaluation of potential outcomes of the case.  As a mediator, anger is a significant bar to resolution.   People do not tend to compromise when their emotions are running hot.  My approach to anger is to reflect, but not adopt or endorse, the anger.  The tactics to diffuse emotions in this situation are complex and vary widely.  I have had success, however, with some general approaches.  First, you can point out that the insurance company and defense lawyer are not the ones that wronged you.  They have honored your loss by showing up to mediation to try to resolve the case and they are just trying to do their job.  If you somehow find yourself in a joint session when anger arises or you note other strong emotional responses, get the parties into separate rooms.  If the litigant is a smoker, ask them if they need a break and point them to the smoking area if you think it would be helpful.   You can also, tactfully, ask them to explain why the other party’s actions have made them angry or why the anger has returned in the mediation setting.  By having them express their emotions with words, you are moving them back into a place where the issues can replace the emotion.  It goes without saying, but you need to be patient with the angry litigant and give them room to process their feelings without judgment.

Depression is a difficult mental state for mediation as well.  It is nearly impossible to assess whether they are experiencing situational or generalized depression.  When dealing with depression, be aware of the fact that it impairs decision making.  Lean on the lawyer to assist you and consider a sidebar with them to determine if the emotional state is a steady one or something that seems out of character for the litigant.   With depression, exercise extreme patience.  Pose questions and allow the party to address it on their time scale and in their way.  Try to determine what things bring them hope and joy and encourage them to talk about those things.

It would seem that bargaining would be the mental state ideally suited to mediation but that is not how Kubler-Ross used the term.   Bargaining is backward looking.  Successful resolution of claims occurs with future orientations.  In the bargaining stage, the person experiencing grief will re-live the event and engage in thought experiments about how it might have turned out differently.  It will manifest with a re-litigation of the facts of the loss and expressions of desire for a different outcome.  It is related to denial in the sense that there is a mental construct that has not accepted the reality of the present.  Unless someone would go back in time and accept the loss in exchange for the check on the table, the bargaining process is an obstacle to settlement.  The mediator, when the past is being re-litigated, should listen for critical issues or motivations, acknowledge the litigant’s feelings, but then re-orient that thinking into the present as a way to begin thinking about the future.

Textbook mediation techniques are about resolving conflicts between individuals.  There is often an ongoing relationship between the parties that needs to be repaired.  This is where techniques of transformative mediation can be especially helpful.   These techniques encourage examining the past harm the parties have caused to each other, reaching a place of recognitions of harm caused, and transforming the relationship for the future with an honoring of the past.  That is rarely what personal injury mediation is about, but the techniques of transformative mediation can be of benefit to the person that needs to process their loss.  At the core, however, personal injury mediations are about financial compensation for loss from the plaintiff’s perspective and risk management from the defendant’s.  The difficult role of the mediator is to help the litigant find meaning in the resolution of their case when they will ultimately be leaving the mediation with only money.  In settlement conference style mediations, I have had clients express that they feel like they are at a used car dealership.  The horse-trading and bargaining can be perceived as an insult to their loss.  There is a balance, then, between exchanging financial positions and structuring the dialogue so that the money is representative of something more meaningful.

In the context of grief, meaning is found in acceptance and an orientation to the future.  This emotional state is also conducive to settling a lawsuit over the loss.  The mediator should, with a full honoring of the loss, start to orient the conversation to the future. In a death case, talk about ways that the loved ones of the decedent honor their memory and plans they have to do so in the future.  In a difficult injury case, talk about new relationships and perspectives that have formed since the loss occurred.  If the Defendant is willing, consider gestures on their part that either honor the decedent or help the litigant understand the steps that have been taken/will be taken to ensure that others are not hurt.    Depending on the amount of money involved, you can consider asking the litigant what they would like to do with the proceeds on the table.  When I have had these conversations people have talked about travel, solving existing financial stresses, providing for their family, and paying for necessities caused by the loss.  It is these things, not the money itself, that will motivate the settlement.   There is never enough money to compensate for many losses.  There is, however, often enough money to improve the present and provide for the future.  This is the framing that the mediator should consider employing.

BATNA is an acronym for best alternative to a negotiated agreement.  One aspect of continued litigation is that the past will continue to be litigated and hinder moving into the future.  This is an important part of the “alternative” to a negotiated settlement.  Closure has value for litigants, attorneys, and insurance companies alike.

By: Jeffrey J. Carey and Marin A. Carey

Our first responders face armed suspects, often alone, and run into burning buildings to protect life and property. Too often, the risks they assume are not fully respected by the public, safety equipment vendors, and even the public agencies that employ them.

First responders rely on a broad range of equipment in life threatening situations. To do their job, they must believe that their equipment will function properly when needed.

Respiratory Protection for Firefighters during Overhaul Operations Operational Field Assessment Report February 2019 (DHS)

From the boots they wear, to the respirator masks that protect their lungs, to the radio systems that allow them to receive and deliver important information, every first responder should have the peace of mind to know that their equipment is without potential faults or failures introduced by the negligence of the manufacturer. The malfunction theory is an aspect of products liability law that insures that in the case of harm due to a piece of defective equipment, the company is held responsible for their negligence.

Project Responder 5, August 2017 (DHS)

In very general terms, products liability law allows the consumer to assume that the products they are using are safe for their intended purpose. Products liability law has evolved since the expansion of the industrial processes in the early 1900’s. It grew out of a disregard for safety by major corporations and the recognized need to ensure that they acted with due care.

In an ordinary negligence suit you must prove that the company that harmed you had a duty to you, breached that duty in some way, and that your damage was the result of that negligence. Products liability law, at its core, simply assumes that the manufacturer was not negligent and acted with due care to make a safe product. As these manufacturers get further removed from their ultimate consumers, there arose a need for strict liability law for manufacturers. There was a belief that negligence law could not adequately address the many problems that arose in the manufacturer and consumer relationship and it was then that courts began to shift away from negligence law by assuming safe conduct by the company. This change in burden of proof allowed the introduction of circumstantial evidence which proves that the equipment did not perform its intended function. This tilting of the system in favor of the end consumer causes manufacturers to self-regulate to ensure that they are not acting negligently, which has led to safer products.

A leading twentieth century tort law scholar, Prosser, has informed much of what is today’s products liability law. His core principle was that a consumer is entitled “to maximum protection at the hands of someone… and that the producer, practically and morally, was the one to provide it” What then follows is case law which defined the ways in which the fact of defect is proven.

The Malfunction Theory of products liability states that a plaintiff may establish a prima facie case by providing evidence of the nature of a product’s malfunction, under circumstances that give rise to an inference that the malfunction would not have occurred absent a defect existing at the time of sale. The plaintiff can prove a product defect with evidence of the occurrence of a malfunction, and with evidence eliminating abnormal use and responsible, secondary causes for the malfunction. This evidentiary standard is essential to ensuring that if there is a malfunction with fire safety equipment, there is a process of being able to hold the manufacturer responsible.

In a case of surviving family members of a deceased firefighter, who died when a valve in his mask and his immobility warning alarm failed, his survivors brought wrongful death action against Survivair Respirators, Inc., They were the manufacturer of the air mask and alarm device that failed to properly activate, and the family alleged that malfunction in the equipment caused the firefighter’s death. In this case, there were many key witnesses who alleged that the air mask valve had malfunctioned on their devices in a similar manner to that of the deceased. In this case, it was the very equipment that was meant to be keeping the fireman safe that caused the unanticipated risk and subsequent deaths.

Survivair Mask. Representative image only.

The Malfunction Theory could be used in this case because multiple firefighters also had stuck valves which they could only clear by taking off their mask and gloves. The Malfunction Theory also allowed the introduction of evidence that his fellow firefighters were searching for him and were close enough for him to hear his PASS alarm but did not hear it sound. According to the case file,” [the] manufacturer had received complaints from several fire departments about similar malfunctions, the manufacturer’s officers knew that a stuck valve could be life-threatening if experienced in a fire, manufacturer made no recall of the masks and did not plan to, and manufacturer was aware of the cause for alarm device failures but had not attempted to take corrective measures. In this case, the manufacturer was held liable and was made to pay damages of $27 million to the family members.

Firefighters and police alike rely heavily on their radio systems in a variety of situations. Recently, there were a number of tragic deaths at a commercial fire in Houston Texas. In a fire, equipment is often destroyed or damaged beyond examination. With radio systems in particular, radio equipment manufacturers like Motorola, BK Technologies, and Harris do not simply sell radios. They sell complex mechanical and software driven systems with multiple parts that must all work together properly to get tone and get the message through.

Radio systems have many different parts and systems that all work together to communicate with responders and firemen and other public servicemen, but when a malfunction occurs in a part of this system, it can have far-reaching impacts. Radios themselves are programmed with firmware that is released by the manufacturers and often introduces bugs. If there was negligence by a radio provider in failing to contemplate how the changes they introduce into something as simple as the radio’s code plug may interact with other system components, they could have potentially put hundreds or more lives at risk. The sheer complexity of these systems and poor documentation of configurations, furthermore, makes precise proof of why the firefighter could not get tone or receive an emergency warning difficult. In cases where the equipment that should be keeping our first responders safe fails due to negligence on the part of the manufacturer, the Malfunction Theory is a necessary tool of law to hold companies accountable for the harm they have caused.

In summation, in the case of negligence or clearly defective safety equipment, the Malfunction Theory can be used in a variety of ways to prove responsibility. Due to the nature of firefighter and other first responder equipment, direct proof of product defect may not always be an option. In that case Malfunction Theory the use of circumstantial evidence to prove defect is and can be appropriate where other causes of the malfunction theory can be excluded. It is also work noting that it is appropriate to hold manufacturers strictly liable, and using the Malfunction Theory as defense, those who have been hurt or injured due to a fault in their equipment at the cause of the manufacturer, you may be entitled to financial compensation.

Jeffrey J. Carey was lead liability counsel on a case filed in Jackson County Missouri against Motorola Solutions, Inc. for alleged radio system defects. He has been practicing in the area of tort and products liability law for over twenty years and has taught continuing legal education and published on a wide variety of tort topics.

Marin A. Carey is a college junior studying environmental policy. She contributed to the writing of this article.

A KANSAS CITY PERSONAL INJURY AND BANKRUPTCY LAWYER CAN HELP YOU NAVIGATE THE COMPLEX INTERSECTION BETWEEN BANKRUPTCY AND PERSONAL INJURY LAW

Jeffrey Carey is a personal injury and bankruptcy lawyer in Lee’s Summit.  He has the skill and expertise to protect your interests as bankruptcy and personal injury law intersect.

If you are forced to file for bankruptcy, your claim is an asset of the estate and is not exempt under Missouri law.  One exception is worker’s compensation benefits, liquidated or not.  An experienced bankruptcy lawyer can help you keep more of your personal injury claim if its value is insufficient to satisfy the claims filed against the estate.  When you file for bankruptcy during the case, your attorney must petition to be approved as counsel by the bankruptcy court.

When the person or company that injured you files bankruptcy, the automatic stay in bankruptcy will apply to immediately require you to cease litigation activities and the trial court will grant a stay.  You should make sure that your personal injury lawyer is aware of the exceptions from discharge which may apply to the case.  If the potential debt is fully dischargeable, an examination of the assets of the estate and the relief being requested must be performed.  After the 341 meeting, the Chapter 7 Trustee is required to either 1) file a report of no distribution and 2) set a claims bar date.

If you are the person responsible for the accident, you will need to notify the court and your lawyer about the claim.  You will then want to assess the arguments for a complete discharge and ensure the case is dismissed once the discharge is granted.

It can be beneficial to have experienced bankruptcy counsel work with you if assets are being administered.  Presuming your claim is large, you may qualify to be on the claims committee in business bankruptcies.

CAN A BANKRUPTCY LAWYER HELP ME PROTECT MY INJURY CLAIM?

When you file for bankruptcy, your assets are the property of the bankruptcy estate, subject to the exemptions granted to the debtor under applicable law. 11 USC § 1541.  Missouri debtors’ exemptions are governed by Missouri law.  Prior to 2013, there was case law to support the assertion that personal injury claims were exempt from the claims of creditors in bankruptcy.  See generally In re Mitchell, 73 B.R. 93 (1987).  In 2013, the 8^th Circuit ruled that injured Missourians who had not yet been compensated for their injuries can not protect their right to compensation in bankruptcy.  In re Abdul-Rahim, 720 F.3d 710 (2013).    Though the Court acknowledged that “It is true that Missouri courts have long held that personal injury claims are exempt from attachment” the only claims of exemption available to debtors is Missouri’s statutory exemption scheme and that “the Missouri legislature has apparently declined the opportunity to amend its exemption statute, section 513.430, to add unliquidated personal injury claims, even in light of the numerous Missouri bankruptcy court decisions precluding such claims from exemption.”  Id.    Absent a statutory measure exempting unliquidated injury claims from exemption, the reasoning of In re Abdul-Rahim is unlikely to be re-visited.

WHAT IF I HAVE AN INJURY CLAIM AND NEED TO FILE BANKRUPTCY?

If you file for bankruptcy, you would have an attorney experienced in bankruptcy and personal injury law to help you protect as much as you can of your claim.   It is essential that the lawyer counsel’s their client that the existence of the claim must be disclosed to the bankruptcy court. First, concealment of assets is a federal crime. 18 USC 152(1).   Second, when a client fails to disclose a potential claim, equity will almost certainly bar them from recovering in the trial court.  Strable v. Union Pac. R. Co., 396 S.W.3d 417 (Mo. Ct. App. 2013).

Your existing lawyer’s attorney’s lien will attach to the injury claim.  They may file a motion to be employed by the bankruptcy estate to complete the litigation.  The trustee, ultimately, has the power to decide who should pursue the claim it is possible your attorney will not be approved if they cannot convince the Court that they have the necessary experience and skill.  If a settlement is reached, the attorney should ensure that it is approved by the bankruptcy court.  In many cases, the recovery in the case is not be sufficient to satisfy all debts and provide adequate compensation to your client.   If you have not reached agreement with the trustee on the division of the claim between the injured party and the trustee (which is advisable) you will want to plead your client’s case for their portion of the recovery before the Bankruptcy Court.

WHAT HAPPENS IF THE PERSON OR COMPANY THAT INJURED ME FILES BANKRUPTCY?

Unless the Court grants relief from the automatic stay, all pending litigation activity will need to cease upon notification of the filing.  When the defendant goes bankrupt, your personal injury or bankruptcy attorney should review the facts, conduct legal research, and formulate support for the position that the claim is not dischargeable.  The exceptions to discharge are listed at 11 USC § 523.  In personal injury actions, the two most common exceptions are for “willful and malicious” injury and for injury caused by a motor vehicle accident where the debtor was intoxicated by alcohol or any other substance.  It will be important to review medical records for prescription medicines which may have been abused or for evidence or alcohol or drug abuse.  It is also important to note that the discharge will not apply to the extent there are insurance proceeds available to satisfy the claim.  In re Patterson, 297 B.R. 110 (Bankr. E.D. Tenn. 2003).  In fact, when the defendant has insurance and you have concluded that no exception from discharge applies, you can consider filing a motion for relief from the automatic stay to obtain permission to resume litigation in the trial court subject to the agreement that you will only collect from insurance proceeds.

When coverage is insufficient or absent or there are assets of the bankruptcy estate, your attorney will want to conduct an examination of the debtor’s claims of exemption and scheduled assets.  They may be under-valuing their property or failing to disclose assets.   If your bankruptcy or personal injury lawyer believe that there is a good faith argument that the claim is not dischargeable or that there are undisclosed or under-valued assets they should file an objection to discharge.  For a full list of grounds for denying the discharge see 11 USC § 727.

YOU CAN PROTECT YOUR WORKER’S COMPENSATION CLAIM IN BANKRUPTCY

Unliquidated and liquidated worker’s compensation claims are exempt in bankruptcy.   Income awarded on a periodic basis in the future, however, must be considered in the debtor’s income available to satisfy the claims of creditors in a Chapter 13 case.  In re Jackson, 173 B.R. 168 (Bankr. E.D. Mo. 1994).

If you file for bankruptcy, you should ensure that your attorney discloses the claim in the bankruptcy and claims an exemption over the entire recovery on Schedule C citing RSMo § 287.260.

NEGOTIATING WITH THE TRUSTEE FOR YOUR FAIR SHARE OF YOUR CLAIM

When an injured person files for bankruptcy, their claim becomes the property of the bankruptcy trustee.  Your future participation in the case, however, is often necessary for a successful recovery.  This gives an experienced bankruptcy lawyer with knowledge of the trustee’s policies leverage to negotiate for your share of the case.  Before In re Abdul-Rahim, there was a custom and practice with the Chapter 7 trustees to agree on an equal share of the net recovery between the injured debtor and the estate.  That is no longer the default position.  It is important, therefore, to work with an attorney that knows how to maximize your portion of any future recovery.

PROTECTING YOUR JUDGMENT

If your claim has been reduced to judgment and you have reason to believe that the judgment creditor may be insolvent, there are steps you can take to perfect your lien.  Your judgment lien automatically applies to all personal property in the state.  If the debtor has out of state assets, you will want to register your judgment there.  You should also record the judgment so that it will constitute a lien on any real estate held by the judgment debtor.  If the defendant seeks an appeal of the judgment, an appeal bond is suggested under Rule 81.09.  If they file bankruptcy after the bond is issued, you will be able to collect your judgment from the bonding company.

Insurance plays an important role in our society. The average American cannot afford to pay for the most catastrophic losses that they may experience in their life. By combining with others, however, they can pay insurance premiums that distribute the risk of a catastrophic loss or liability. The primary purpose of insurance should be to pool that risk of loss and provide insurance coverage in a time of need.

Bad Faith Insurance Practices

The insurance industry, however, is an extremely powerful industry that is prone to the same type of corporate abuses seen in other industries. Too often insurance companies place their own economic interests above those of the policyholder. Common bad faith practices include conducting inadequate investigations of claims, making “lowball” settlement offers of claims, ignoring claims for long periods of time and refusing to communicate with the claimant, and relying on policy exclusions that were not intended to apply to the claim presented by the policyholder.

When your own insurance company acts in bad faith when you make a claim for damages it called a “vexatious refusal” to pay. Examples of vexatious refusal include refusal to pay and honor uninsured and underinsured motorist claims, refusal to pay medical benefits unless the policyholder agrees to reimburse the insurance company (for many Missouri health insurance policies), and refusal to pay life or fire and casualty insurance claims. Missouri law provides that a policyholder who is a victim of vexatious refusal to pay can recover penalties against the insurance company and be awarded their attorney’s fees.

The second way to fight bad faith practices is to file a bad faith insurance action. These actions apply when someone else’s insurance company treats you unfairly. If someone causes injury to you and their insurance company refuses to offer a fair settlement, fails to conduct an adequate investigation, or denies coverage the insurance company’s actions may rise to the level of bad faith. These actions are very complex as the claim for bad faith cannot ordinarily be brought by the injured party. With proper planning, however, the injured party can negotiate for the right to proceed against the other party’s insurance company or assist the other party in presenting a bad faith claim to their insurance company. A successful bad faith insurance claim may include recovery of all of the damages sustained by the injured party, attorney’s fees incurred by the policyholder, and punitive damages.

Often insurance companies play a valuable role in a time of need. Too often, however, the bottom line is placed above the interests of the policyholder. When this occurs the Carey Law Firm can assist you in forcing the insurance company to live up to its obligations.