When car accidents happen, the prospects of obtaining fair compensation for victims often thin out. This is largely due to an insurance system filled with obstacles, frequently put in place by insurance adjusters aiming to minimize payouts and protect their company’s bottom line.
Understandably, this presents significant challenges in New York, where car accidents occur daily. The National Highway Traffic Safety Administration (NHTSA) reports over 100,000 car accidents occurring in New York in 2023.[1] In pursuing compensation from insurance companies, many victims face significant hurdles, with fewer than 2,000 claims filed and an even lower percentage of successful compensations.[2]
Recently, courts have increasingly ruled in favor of victims, challenging insurance companies’ tactics of delay, denial, and underpayment. A notable case from 2002 exemplifies this trend. In that case, the victims sought Supplementary Uninsured/Underinsured Motorist Benefits (SUM) after a car accident, providing timely notice.
The insurer, however, focused on incomplete proof-of-claim forms, alleging non-compliance. It delayed the petition for nine months, requesting additional documentation. Ultimately, the court ruled in favor of the victims, finding the insurer’s notice requirements unnecessary and burdensome.[3]
When a car accident victim is unable to obtain the full damages they seek and deserve, financial difficulties can quickly follow due to out-of-pocket expenses. In such cases, victims may wonder if filing for an insurance claim was worth the effort.
The unfortunate reality is that there is a significant gap between the compensation awarded in many car accident cases and the actual impact on victims and their families. Bridging this gap requires proactive measures—ideally, with the counsel of a New York Accident Lawyer.
This post will provide an exposé into the challenges of the insurance claim process, revealing common tactics used by insurers and sharing practical tips for negotiating a car accident settlement.
1 National Highway Traffic Safety Administration Report (accessed October 27, 2024)
2 NYC Comptroller’s Annual Claims Report (accessed October 2024)
3 Matter of New York Cent. Mut. Fire Ins. Co. v Aguirre, 20 AD3d 538
Understanding Your Rights under New York Insurance Laws
In New York, car owners are required to carry an insurance policy, which includes minimum coverage for car accidents categorized as personal injuries.[4] The state’s No-Fault Law mandates that the injured party’s insurance company assumes liability for medical treatment and other costs regardless of who is at fault.
If an insurance company fails to cover car accident costs, the financial impact on victims can be severe, leading to accumulating medical expenses, repair bills, and other damages. In the most serious cases, accidents may result in death or lasting injuries, compounding financial strain and stress for families.
However, many insurance claims do yield favorable outcomes for victims, highlighting the importance of understanding New York insurance laws. Victims are entitled to compensation for basic and non-economic losses,[5] including no-fault benefits, with potential awards reaching or exceeding $50,000.
Is New York A ‘No-Fault’ Insurance State? What Does This Mean?
Yes, New York operates under a “no-fault” insurance system. Simply put, an insurance policyholder is reimbursed by their insurance company for accident-related damages, regardless of fault.
According to New York State Department of Financial Services (DFS) guidelines,[6] no-fault coverage includes:
- Reasonable and necessary medical and rehabilitation expenses
- Up to 80% of lost earnings for up to three years
- Up to $25 per day for additional expenses
- A $2,000 death benefit if the accident is fatal
New York’s ‘no-fault’ status requires drivers involved in accidents, such as rear-end collisions, to use Personal Injury Protection (PIP) coverage for accident-related injuries, regardless of fault.[7] However, victims may pursue liability claims against other drivers if their injuries meet specific severity thresholds, necessitating proof of negligence or a safety rule violation.
New York also follows pure comparative negligence principles, allowing crash victims to seek compensation from other parties, even if they bear some responsibility. Liability is assigned proportionally, and damages are allocated accordingly.[8] In practice, this means that even if another driver is only 5% at fault, they may still be liable for 5% of the total damages.
Do Victims Have a Time Limit to File a Lawsuit?
New York state law requires all drivers to carry uninsured motorist coverage as part of their auto insurance.[9] This coverage protects you if an uninsured driver causes your injuries. However, if you lack auto insurance (e.g., you don’t own a car), you may need to file a claim directly against the at-fault driver.
After an accident, it’s crucial to begin the claims process promptly, as there are statutory deadlines for submitting insurance claims.[10] Generally, you have 30 days to file a no-fault insurance claim.
In New York, victims have a limited window to pursue legal action, known as the statute of limitations. Under §214 of the Civil Practice Law & Rules, the time frame to file a personal injury claim is generally three years from the accident date though there are shorter deadlines against certain municipal organizations such as the City of New York or other govermental entities. [11]
If the accident results in death, a wrongful death suit must be filed within the statutory limit set by the Estates, Powers & Trusts Law §5-4.1.[12] It’s worth noting that there are exceptions to these deadlines. Consulting with a car accident lawyer can help navigate these complex laws and determine your options.
Ultimately, in order to protect your rights, it is advisable to speak with an attorney as soon as possible after an accident. Missing an applicable deadline could forfeit your right to seek compensation.
5 New York Consolidated Laws, Insurance Law – ISC § 5102
6 New York State Department of Financial Services
7 NYC Bar – Compensable Damages
8 NY CPLR § 1411
How to Handle Insurance Claims After a Car Accident
Document and Report the Accident
Following a car accident, the first crucial step for the victim is to document the incident. Thoroughly gathering evidence and recording the scene is essential for supporting your insurance claim. Begin by photographing the accident scene from multiple angles, capturing vehicle damage in detail. Ensure that your documentation provides a clear view of the accident location, including intersections, road signs, and traffic lights.
Next, meticulously record all visible injuries sustained in the accident. After completing these essential tasks, exchange information with the other parties involved. Collect names, phone numbers, insurance details, vehicle information (make, model, and license plate number), and driver’s license information.
Under New York laws, reporting accidents that result in death or personal injury to the New York Department of Motor Vehicles is mandatory. Reporting is also required if the crash results in property damage valued at $1,000 or more. In these cases, you must file the Report of Motor Vehicle Accident (MV-104) form.[13] If the accident involves a fatality, you must notify the police immediately and file the MV-104. Fleeing the scene of an accident that results in death is a criminal offense in New York.
Even if there were no fatalities, it’s essential to notify your insurance provider promptly, as delays may compromise your claim. This is also an appropriate time to consult with a lawyer who has experience handling insurance claims after a car accident. By thoroughly documenting the accident, you strengthen your insurance claim and establish a solid foundation for a smoother resolution.
Why You Must Seek Medical Attention After a Car Accident
The phrase “health is wealth” takes on added significance when filing an insurance claim after a car accident. Medical expenses can escalate quickly, placing a heavy financial burden on the victim. Injuries from car accidents can range from mild concussions to severe amputations, and in the worst cases, fatalities.
Seeking immediate medical attention is essential, no matter how minor the injuries may initially seem. Some injuries, like whiplash, may not be apparent right away but can have serious health implications later on.
The core of your insurance claim lies in the extent of your injuries. This will justify the compensation you seek and why the insurance company should cover your expenses. To support this, you need concrete medical evidence. A comprehensive medical evaluation can be extremely helpful, as any injuries or bills not substantiated by medical records may be excluded from coverage by the insurance company.
When filing a personal injury claim, the insurance company or court will scrutinize your actions following the accident, particularly any delays in treatment. In New York, only individuals with “serious injuries” may pursue fault-based claims against negligent drivers. Delaying medical treatment could weaken your case, as the insurer may argue that your injuries were not serious or were unrelated to the accident. Timely medical care, on the other hand, establishes a clear link between the crash and your injuries, significantly strengthening your claim.
What to Do If an Insurance Claim Is Denied in NYC
When you file an insurance claim after an accident, an adjuster will assess the extent of injuries and determine whether to approve or deny the claim.
It’s not uncommon for claimants to experience delays or outright denials. If the insurance company denies your claim, they will provide a formal letter explaining the reasons. However, a denial doesn’t have to be the final outcome.
Victims can appeal the decision by gathering supporting evidence, such as police reports, eyewitness statements, photos, and medical records. Successfully appealing a denial requires detailed documentation of the accident and a carefully written letter challenging the denial. The letter should reference the relevant policy provisions and the reasons for the denial.
The reason for denial will influence the best approach for the appeal. Consulting with an attorney can be invaluable in reviewing your case, drafting a compelling response, and potentially overturning the denial.
The appeals process gives you the opportunity to contest a denial and potentially receive the compensation you deserve.
13 Report of Motor Vehicle Accident (MV-104)
Delay, Denial, and Underpayment Tactics by Insurance Adjusters (and How to Handle Them)
Like other businesses, insurance companies are profit-driven. They operate on a simple model—maximize premium collection and minimize payouts to policyholders.
Occasionally, due to overzealous oversight or bad-faith intentions, insurance companies adopt tactics to reduce payouts at the expense of their policyholders. These tactics generally fall into three categories: Delay, Denial, or Underpayment.
Delay Tactics
In some cases, insurance companies engage in bad-faith practices by intentionally delaying the claims process. They may repeatedly ask for documents you’ve already provided, stop responding, demand excessive information, delay sending an adjuster, or take months to process simple claims.
These delays can put financial strain on policyholders, causing some to abandon their claims or accept lower settlements out of frustration.
Blatant Denial or Misrepresentation
Another tactic is to deny legitimate claims. Insurers may give vague or unfounded reasons for denial, or misinterpret policy language. A common approach is to assert that the policy does not cover a specific injury or that the policyholder has failed to meet certain conditions, even when the evidence suggests otherwise.
Disputing Your Injuries or Claim
Insurance companies might argue that your treatment is not medically necessary, even if recommended by a healthcare provider. This tactic is designed to minimize payouts by making you believe that your injury is unrelated to the accident, allowing them to underpay what should be covered medical expenses.
Bad-Faith Investigation and Surveillance
Surveillance is another method insurers use to gather evidence against claimants. By doing so, they aim to misrepresent findings to reduce or deny claims. This invasion of privacy can create a hostile environment for claimants, who may feel discouraged from pursuing their claims.
Lowball Settlement Offers
Insurance companies often attempt to downplay your injuries, offering a low initial settlement that undervalues your claim. This offer may come before you fully understand your injuries’ long-term impact, hoping to capitalize on your lack of information.
This tactic is designed to prompt you into accepting a quick payment, thereby closing the claim and limiting your future financial recovery. Resisting initial pressure to settle allows you to fully assess injuries and damages before making a decision.
Tips for Negotiating a Car Accident Settlement with Insurance Companies
Insurance companies typically begin with low offers, expecting negotiations. Don’t rush to accept an offer before you understand your claim’s full value and have completed medical treatment.
Rejecting the first offer is common and rarely backfires, as insurers usually anticipate negotiations. Consulting with a lawyer can help you make informed decisions.
While insurance companies have vast resources, you have the right to hold out for fair compensation. Take the time to fully evaluate your injuries and their long-term costs, and don’t hesitate to seek expert advice.
Insurance adjusters expect rejection of the first offer, using it as a negotiation starting point. Unless the claim lacks merit, rejecting the initial offer typically leads to further discussions. Understanding these dynamics and standing firm can help you navigate the settlement process and achieve your desired outcome.
In a recent ruling, the New York Court of Appeals held that insurance carriers must demonstrate prejudice before denying coverage based on late notice of a Supplementary Uninsured/Underinsured Motorists (SUM) claim, provided the insured gave timely accident notice.[14] This case underscores insurers’ contractual obligation to act in good faith toward their policyholders.
14 Rekemeyer v State Farm Mutual Automobile Insurance Company (2005)
How Can I Avoid Bad Faith Insurance Tactics?
Bad faith insurance occurs when an insurer intentionally tries to renege on its obligations to clients. Simple mistakes don’t necessarily qualify as bad faith, but a pattern of unethical behavior or intentional deception may.
There are ways to protect yourself from bad-faith insurance practices. First, keep detailed records of all interactions, correspondence, and claims submissions. It’s also essential to understand your policy’s terms, limitations, and exclusions. If anything is unclear, consider hiring a lawyer to help interpret the policy.
Clear communication can also help shield you from bad-faith tactics. Express your concerns and expectations early on. Many states have laws in place to protect consumers from bad-faith insurance practices, so familiarize yourself with these regulations and seek support when needed. By recognizing bad-faith tactics and taking proactive steps, policyholders can work to ensure fair treatment and protect their rights.
It’s important to note that not only insurance companies can be guilty of bad faith; occasionally, claimants attempt to exaggerate or falsify claims to secure larger settlements. In a 1959 case, for instance, the court ruled in favor of the insurance company after finding inconsistencies in the claimant’s testimony.[15]
Cases like this are, however, the exception rather than the rule, as insurance companies are often seen cutting corners themselves. In a notable 2000 case,[16] car accident victim Carmella Pinto sustained serious injuries, including a herniated disc and nerve damage. The defendant’s liability was conceded, and jury deliberations suggested a high probability that the verdict would exceed the $100,000 policy limit held by Allstate Insurance.
Despite this, Allstate initially offered only $30,000 to settle the claim. The jury ultimately awarded Pinto $350,000. After Allstate paid its policy limit of $100,000, Pinto’s legal team filed a federal lawsuit against Allstate, alleging bad faith for failing to settle within the policy limits when it was apparent that a jury might award a much higher amount.
A lower court initially granted summary judgment in favor of Allstate. However, this ruling was overturned on appeal by the Second Circuit Court of Appeals, leading to a trial. Ultimately, Allstate agreed to settle for an additional $325,000, bringing the total to $425,000—far above their original policy limit.
15 Car and General Insurance Corp. v. Goldstein, 179 F. Supp. 888 (S.D.N.Y. 1959)
16 Pinto v. Allstate Insurance Company, 221 F.3d 394 (2d Cir. 2000)
Why Should I Hire a Lawyer?
When hiring legal counsel for insurance-related cases, carefully assess their success rate in similar cases. The lawyer you choose should be able to demonstrate knowledge of potential obstacles set by insurance companies and strategies to overcome them.
A good rule of thumb when hiring a lawyer is to prioritize firms with a proven track record in car accident cases, expertise in New York insurance laws, and strong negotiation skills. Dandalaw’s legal team, for example, has achieved remarkable success in car accident insurance claims, including securing a multimillion-dollar award for a six-year-old victim of an ambulance-minivan collision, despite the insurance company’s initial denial of liability.[17]
How Can I Cover Legal Costs?
Fortunately, contingency fee arrangements offer a practical option for victims who cannot afford hourly legal fees. In this type of arrangement, the lawyer is entitled to a predetermined percentage of the settlement once the case is resolved in your favor. Dandalaw offers contingency fee payment options tailored to the unique circumstances of each case.
Conclusion
After familiarizing yourself with the basic requirements for pursuing a claim, maintain detailed records of the accident to support your case, and consider hiring an attorney who can strengthen your claim with evidence and investigative expertise to help you pursue the maximum compensation under the law.
No-fault insurance in New York is designed to protect citizens’ rights, but these rights are best asserted with strong legal representation. With a qualified attorney, you can confidently claim your legal entitlements from the insurance company.
When it comes to settlements, experience is essential. You need a lawyer who understands the complexities and tactics that insurance companies might employ to limit your compensation. Have you faced difficulties with an insurance company after an accident? Consult a lawyer to negotiate a fair settlement. Share your story below or contact dandalaw.com for a free consultation.
17 Dandalaw – Car Accident Case Resulting in Serious Injuries