At Barry P. Goldberg injury lawyers in Woodland Hills, we handle all things “Uninsured” and “Underinsured.” A frequent question we get all the time is “How long does an underinsured motorist claim take?” It is a great question because the answer is not obvious and implicates earlier actions and procedures. Nobody—not even Barry Goldberg—The UM Guru— can give exact calculations. However, with more and more accident cases implicating “Underinsured Motorist Coverage” (“UIM”) consider some of these important factors in making your own calculations.
There is a “Prerequisite” before Underinsured Motorist Coverage Applies—Exhaustion
In order to do the proper calculations, it is important to understand exactly what UIM coverage actually is. UIM presupposes that a third-party settlement or judgment has been obtained for the full amount of available liability coverage. The law contained in Insurance Code 11580.2 requires that the available third-party liability coverage be “exhausted.” That means that the policy limit or limits must be physically paid and that reasonable proof be submitted that all of the available liability insurance was considered.
When you understand what UIM coverage is, this makes perfect sense. In order to determine if UIM applies, it is a simple mathematical comparison. You take the amount of your “Uninsured” motorist coverage and subtract the amount of the third-party liability insurance available. If there is an amount remaining, that is the amount of available UIM coverage in your case. (For example, if you have $50,000 in Uninsured Motorist coverage and the third-party at fault driver has $15,000 in liability coverage. Then, you have $35,000 in UIM coverage over and above the $15,000— after that $15,000 has been “exhausted” by payment.)
The insurers usually only require a copy of the third-party’s Declaration Page showing the extent of coverage. That Declaration Page is what is issued by the insurance company telling you exactly what you are covered for. In some more complex situations, further proof may be required to rule out other possible coverages, umbrella policies and overlapping policies. It is customary to send your UIM insurer a copy of the third-party declaration page along with a copy of the check showing that the amount listed on the declaration page was actually paid or “exhausted.” Best practices suggest that the UIM insurer also be provided with a copy of the third-party Release and a declaration from the insured (or the insurer) that no other liability insurance is available or applies to the subject loss.
A quick word about third-party Releases. You do not need the UIM insurer’s permission to settle the underlying claim for the policy limits. Further, your third-party Release does NOT release your UIM claim!
The Length of the Third-Party Claim Influences How Long Your UIM Claim Takes
A better question than how long does your UIM claim take is “How long does your whole claim take!” As an expert on all things UM and UIM, I can say that I have almost seen it all on the time it takes for a UIM claim. Often, I am consulted after the underlying third-party claim is concluded. That amount of time varies greatly from case to case. Consider the time it would take to “exhaust” a $15,000 California state minimum liability insurance policy when the case is potentially worth several hundreds of thousands of dollars. An experienced trial attorney can “exhaust” that minimum in a matter of days.
Alternatively, consider a disputed liability circumstance where the value of the claim is just slight above the $15,000 minimum limits. A case like that may take considerably longer to resolve. In fact, we have seen cases where it takes tears to resolve and exhaust the third-party limits. Sometimes, close to 5 years later after a trial! Then, and only then, may the insured present an UIM claim to his or her insurer. Of course, that is the exception. But you can see how an UIM claim can stretch way out.
As a result, in California, there is no official “Statute of Limitations” when it comes to underinsured motorist claims. There are, however, requirements that the claim not be delayed or stalled.
The Actual UIM Portion of Your Claim Should be Fast—No Lame Attorney Excuses!
Okay, your third-party liability claim is exhausted by payment, how long now? Other than forwarding the closing documents, most UIM claims are ready for submission to the insured’s carrier for payment. We see all the time, plaintiff’s attorneys that drag their feet in making and concluding an UIM claim. The reason, in most cases, is that the plaintiff’s attorney is not really “solid” on the UIM law and procedure. So, the case takes an unnecessary backseat to other matters. In fairness, the UM and UIM laws are both confusing and scattered around. That is why it is nice to work with our firm and the UM Guru!
Barry P. Goldberg has published numerous articles and blogs urging counsel to quickly and promptly move and resolve UIM claims. The insurers have many delaying tactics and seem to regularly convince plaintiff attorneys to wait to conclude the claim. An Underinsured Motorist claim must be pursued aggressively right from the start. We recommend that selection of the single arbitrator commence in the very first demand and notification letter. If the insurer and counsel delay, we recommend the filing of a Petition to Compel Arbitration, followed closely by a Motion to Select an Arbitrator.
Obtaining an arbitration date appear over and over to being the key to getting an UIM claim paid. There is usually no problem getting an UIM arbitration set within 90 to 120 days. Most cases are truly ready on day one after the third-party settlement. In fact, most UIM claims are based on the exact same facts and medical analysis as the third-party claim. Why not send your demand letter with all the attachments on day one?
Admittedly, Some UIM Claims Take Longer.
Although most UIM claims can be resolved in relative short order, there are some big and complex cases that can take an additional year or more. For example, significant discovery and exchange of information is usually required when there is a large UM policy and a much smaller third-party liability policy. (Consider, however, that the third-party policy should be tendered relatively promptly!)
If it is a big and complex case, that might also mean that the injuries and damages may take longer to evaluate after treatment. There will be experts, depositions and discovery, much like a “regular” court-litigated case. That said, it is our opinion that most lawyers still take too long because discovery should be limited to an extent. In addition, since it is a first-party case (insurer and insured), the insurer must look for ways to evaluate and pay the claim as soon as it can reasonably do so, or face “bad faith” liability.
So—How Long Does My UIM Claim Take?
If you take all of the above factors into consideration, your UIM claim should take just a little more time than your third-party claim alone (unless it is a big policy or complex case). In our office last year, the average case, from front to back took just about 8 months. Of course, this average included cases that were very small and that were very large. It included cases that were actively litigated in the Superior Courts and—- finally— cases that had UIM claims.
Because UIM claims have the prerequisite “exhaustion” requirement, it is fair that your UIM claim will skew towards the longer side of our firm case averages. In most UIM claims the cases are concluded in total between 6 months and a year. If the claim involves a long or disputed third-party claim before exhaustion, add the time to conclude that claim to an additional 3 to 6 months.
If you are wondering how long your claim actually will take, you need to call our office for a free consultation. We will provide you with a fair time analysis based upon the factors listed above. If your third-party claim is either concluded or about to conclude, go ahead and send your lawyer this article and request that he or she push the case to an UIM arbitration date as quickly as possible!