North Carolina Insurance Law Newsletter: Insureds Seeking Extra-Contractual Damages From Their UM/UIM Insurers

Your insured is injured in an auto accident and makes a claim pursuant to his/her UM/UIM coverage.  You can't agree on the reasonable settlement amount, so your insured invokes the arbitration clause set forth in the auto policy.  An award of damages is eventually entered by the arbitration panel, and you promptly pay that award in full. 

 

Having completely satisfied the terms and conditions of the auto policy, your company can now close the claim and move on to the next one, right? 

 

Not necessarily, a federal court  recently concluded.  In Guessford v. Penn National (M.D.N.C. Jan. 16, 2013), Judge Beaty held that an insured who had been paid promptly and in full by his UIM carrier following the entry of an arbitration award could still assert claims for bad faith and unfair and deceptive trade practices based on Penn National's handling of the UIM claim. 

In the current issue of the North Carolina Insurance Law Newsletter, I provide a summary of the Guessford decision, followed by some lessons that North Carolina auto insurers can take away from that case.  Click here to read the newsletter http://ow.ly/kBnfP and, if you are so inclined, I encourage you to sign up to receive my quarterly newsletter via email.  You'll find the sign-up box in the right-hand column of my blog. ==>

A Preview Of Potential Insurance-Related Legislation During North Carolina's 2013 Legislative Session

The Insurance Committee of the North Carolina House of Representatives invited Insurance Commissioner Wayne Goodwin and his Legislative Counsel, Rose Vaughn Williams, to speak to it earlier today regarding potential insurance legislation for the 2013 Session.  During the roughly thirty minute presentation, Commissioner Goodwin pointed to the following areas where insurance-related legislation might be anticipated:

• Expanding the state’s current captive insurance law; it is believed a bill will be proposed in the Senate in the near future.
• Commissioner Goodwin seeks increased authority over long term care insurance rates.  This issue arose out of consumer complaints regarding sharp, unexpected increases in the cost of such coverage. 
• Updating the state’s risk based capital requirements to obtain reaccreditation from the NAIC.  This will prevent North Carolina based insurers from having to undergo otherwise unnecessary audits in other states where they write coverage.
• Preserving the authority to assist with appeals by consumers who have had health care coverage denied.
• Maintaining state control in the health insurance arena.  Commissioner Goodwin did not delve into the details of the debate over the proposed health insurance exchange (which appears to be a lost cause), but he did make the point that, whatever one thinks of Obamacare, it is advantageous for North Carolina to retain as much control over healthcare as possible, rather than ceding power to the federal government.
• Commissioner Goodwin acknowledged there will likely be proposed legislation (not for the first time) to change the way auto insurance rates are set.  He urged lawmakers to question why some (but by no means all) auto insurers seek to change the current system.  He also emphasized that under the current ratemaking system North Carolina has the lowest auto insurance rates in the south and the seventh lowest rates in the country.  He noted further that there are more than 200 auto insurers writing coverage in North Carolina, and that the Rate Bureau has not asked for rate increases in four years - facts which arguably suggest that the current system is healthy and works just fine.
• Finally, Commissioner Goodwin observed that there are ongoing challenges in the property insurance market.  One problem that he noted was the difficulty the insurance industry has in obtaining adequate reinsurance in the event of a catastrophic loss, such as from a hurricane.

A Conversation With Ray Evans, General Manager Of The North Carolina Rate Bureau

Despite the North Carolina Rate Bureau’s substantial impact on the finances of the state’s residents, it is safe to say that its purpose remains unknown to the large majority of North Carolinians.  And that’s just fine with Ray Evans, who’s skillfully served as the Rate Bureau’s General Manager for the last twelve years: “We’ve kind of been in the background and try to stay out of the way.  But a lot of things go on here.”  Curious to learn more about just what sorts of “things go on here,” I recently sat down with Mr. Evans at the Rate Bureau’s new office in North Raleigh, where he was kind enough to provide an overview of the organization’s history and its day-to-day operations.  Mr. Evans also offered some comments about what the uncertain future might hold for the Rate Bureau.

North Carolina Insurance Law - 2012 Year End Review

The world of North Carolina Insurance Law had a number of important developments during 2012, and in the new issue of the NCIL newsletter you will find a recap of the year’s biggest insurance stories from the executive, legislative, and judicial branches.  To read an overview of the biggest stories of the year, click here to read the newsletter. 

If you would like to receive the NCIL newsletter via email each quarter, please use the sign-up option in the box you will find in the right hand column. ==>

Should A Judgment That Has Been Paid In Full By A UIM Carrier Be Marked "Satisfied" As It Concerns The Defendant?

Is a judgment against a defendant automatically satisfied when it is paid off in full?  Not when that judgment is paid by a plaintiff's own UIM carrier, according to the North Carolina Court of Appeals’ decision in Wood v. Nunnery.  Even though the plaintiff has been paid in full under the contractual terms of a UIM policy, the defendant is still liable in tort.  As the court put it: since “the judgment was entered only against defendant [and not the UIM carrier] … defendant is responsible for satisfying the judgment entered against him.” (p. 9)

Co-Presenting Continuing Education Course - "Auto Torts & Pedestrians"

I'm pleased to announce that, along with my colleague Todd King, I will be co-presenting a continuing education course on November 28, 2012, entitled "Auto Torts & Pedestrians." The program has been approved for three CE credit hours by the North Carolina Department of Insurance, and covers North Carolina statutory and case law governing the auto/pedestrian relationship, case handling strategies, applicable insurance coverage under the North Carolina personal auto policy, as well as trends and statistics pertaining to this area of the law.  Todd and I will be giving our presentation tomorrow at Amica Insurance here in Raleigh, but we will be happy to schedule a free presentation for the claims professionals in your office anytime.  Please don't hesitate to contact me at 919-863-8749 if you would be interested in having the presentation brought to you.

If this happened in the U.S., the clip would end with Chevy Chase getting served with a lawsuit!

North Carolina Insurance Law Newsletter - Fall 2012

With Election Day just around the corner, this issue of the North Carolina Insurance Law newsletter features my interviews with the two candidates for the post of North Carolina Insurance Commissioner - incumbent Democrat Wayne Goodwin and his Republican challenger, Mike Causey.   

Who are the two men who seek your vote for North Carolina Insurance Commissioner, and what do they stand for?  Check out my newsletter to find out: http://ow.ly/eXjJX

If you would like to receive my quarterly North Carolina Insurance Law newsletter via email, please sign up in the box to the right. ==>