Woodland Hills personal injury attorney Barry P. Goldberg is asked this question all the time—why won’t the insurer for the driver that hit me disclose the available policy limits information? The insurers’ continued refusal to cooperate and disclose is often viewed as “shady” by auto accident victims. Ironically, the insurers’ steadfast refusal drives potential clients to lawyers in order to find out this relatively simple and often time benign information. Recently, I handled a case in which State Farm, the nation’s largest auto insurer, refused to follow the law in this area.
Consider that most drivers in California maintain the absolute minimum amount of insurance. The limits for the minimum are hardly adequate in about 50% of all accidents. That means it is very important to determine whether the at fault driver has those low limits right away. A careful accident victim will consider as soon as possible 1) whether his Underinsured Motorist limits will apply; or 2) whether medical treatment and property damage repair should be minimized. It is standard practice in California for the insurer to send a written request to its insured asking for permission to disclose limits information.
Sometimes insureds grant permission—sometimes they do not. Whether to grant such permission is a hot topic and question we see on social media sites with great frequency. My advice is always the same—disclose the information. It may avoid a lawsuit against you.
The insurers traditionally have analyzed the issue completely upside down. The insurers argue that if a claimant learns that the at fault driver has large limits, he will unnecessarily incur extensive and unneeded medical care in order to take advantage of the opportunity to obtain a larger settlement. Back in the 1980’s, the fight over disclosure of policy limits was hotly contested and litigated resulting a final determination that everyone (almost) abides by. See, Griffith v. State Farm Mut. Auto. Ins. Co. (1991) 230 Cal.App.3d 59.
As will be discussed more fully below, it is my opinion that Griffith unilaterally brokered a workable solution that is based on fairly dubious reasoning. Here is the short summary of the Griffith holding. Prior to the filing of an actual lawsuit, an injury victim is not entitled to the adverse driver’s insurance information—–unless, the adverse driver agrees to provide the information. After a lawsuit is filed, the insurer must disclose the information and consent from its insured is not needed. The court reasoned that the insured’s privacy rights outweighed the victim’s right to know up and until the time of filing a lawsuit:
“Similarly, once a lawsuit has been filed, and thus the potential claimant has demonstrated a serious claim is being asserted against the insured, courts have recognized that an adverse party has a “ ‘discoverable interest’ in [the other party’s] liability insurance which arises with the ‘very pendency’ of the action against the assured; that therefore, the existence and policy limits of the [insured’s] liability insurance are relevant to the subject matter involved in the personal injury action….” (Pettie v. Superior Court, supra, 178 Cal.App.2d at p. 683, 3 Cal.Rptr. 267, emphasis added; Laddon v. Superior Court, supra, 167 Cal.App.2d 391, 334 P.2d 638.) The courts have acknowledged that the disclosure of the information will facilitate the resolution of the pending controversy. (Pettie v. Superior Court, supra, 178 Cal.App.2d at p. 689, 3 Cal.Rptr. 267.) However, this right to know arises upon the pendency of the suit.” (Griffith at pp. 69-70.)
I would argue that the “very pendency” of a real claim should be the trigger particularly in a state absolutely loaded with “underinsured” motorists.
Ironically, the case determining the absolute right of claimant’s to obtain such information from the adverse insurer involves State Farm. My recent experience with State Farm is that company wide, State Farm will not voluntarily disclose policy limits information even after a lawsuit is filed contrary to Griffith vs. State Farm!
In truth, an insurer’s failure to voluntarily disclose policy limits information rarely impacts the way we handle our cases. If an insured refuses to allow its insurer to disclose policy limits, we write a letter telling the insurer to inform its insured that if they do not disclose, we will immediately file suit and the insurer is obligated by law (Griffith) to disclose the information with or without their consent. Guess what? They always disclose!
As for State Farm, I will seek a judicial determination that its conduct is contrary to law at the first opportunity that it is presented! If you have questions about the adverse driver’s policy limits, I advise that you consult with an experienced personal injury attorney that will not take “no” for an answer!