February 4, 2013

Louisville Car Accident UIM Case

In November of 2012, the U.S. District Court for the Western District of Kentucky heard a case involving a Louisville car accident and an underinsured (UIM) issue. (See Netherlands Insurance Co. v. Brock, 2012 WL 5397953 (W.D. Ky. 2012)).

In this Louisville car accident UIM case, the issue was whether or not the UIM insurer complied with the Kentucky Insurance Code so as to preserve its subrogation rights against the tortfeasor’s liability carrier. The case is before the court because the Plaintiff is seeking declaratory relief on the grounds that it fully complied with the mandatory requirements of the KRS.

The Louisville car accident occurred on May 12, 2009. The Defendant while driving a company car was injured in a car accident. The defendant in that car accident had a $25,000 policy that it was ready to tender. It offered the policy on February 12, 2011. On March 14, 2011, the Louisville attorney for injured party sent a certified letter to Plaintiff in this case detailing the proposed settlement per the KRS requirement also known as a ‘Coots’ letter. (All Louisville car accident attorneys know what a “coots” letter is.)

On April 14, 2011, the thirtieth day following receipt of the proposed settlement an agent for the Plaintiff contacted the Louisville car accident lawyer and informed him of their intention to preserve its subrogation right and that they would tender payment of the $25,000 offered by the other carrier. A check for $25,000 was received by the Defendant’s attorney on April 15, 2011. One day after the 30-day time period requirement.

Since the check was received late, the Louisville car accident lawyer rejected the payment and accepted the payment from the original tortfeasor. So, the Plaintiff in this case then filed its declaratory action.

“To recover UIM benefits from the insurer, Kentucky law directs the injured to provide the UIM insurer notice, by certified or registered mail, of his intent to settle the personal injury claim with the third-party tortfeasor before the claim is settled. This preserves the UIM carrier’s subrogation rights by not releasing the tortfeasor and its insurer. The statute at issue provides the UIM insurer with “thirty (30) days to consent to the settlement or retention of subrogation rights.” (cites omitted). If an underinsured motorist chooses to preserve its subrogation rights by refusing to consent to settle, the underinsured motorist must, within thirty (30) days after receipt of the notice of the proposed settlement, pay the insured party the amount of the written offer from the underinsured motorist’s liability insurer.” (cites omitted)
So, based on what the court found as clear language, the Plaintiff had to have paid the injured party on or before the 30th day. Since the check came on the 31st day, the court said that the language was “mandatory” and that failure to preserve said subrogation rights is thereby lost.

If you have been the subject of a Louisville Underinsured (UIM) Car Accident matter, please call and speak to a Louisville Underinsured (UIM) Car Accident lawyer at the Law Offices of Alitowski & Moore, P.A. at 888-ASK-ANDREW (888-275-2637) or contact us online. We are available 24 hours a day, 7 days a week.

If you are injured…Ask Andrew!!!