Tuesday, October 9, 2007

Third Party Insurance Claims Eliminated to the Detriment of Indirect Victims

California law limits the liability exposure of California insurers from bad faith arrangements by eliminating the right of third party claims. This means that with exceptions, a defendant’s insurer cannot be sued without contractual relationship regardless of how affected the third party is by the insurer’s atrocious conduct. First party claims remain viable: this article http://www.righthandfirm.com/blog/ sets forth California Insurance Code Section 790.03 which states in part the unfair practices of insurers.
An example of this is my client, Janine’s claim for damages. Janine is an 18 year old theater performer in Los Angeles. This year, her production company decided to sponsor a big theatrical play, “The Lion, the Witch, and the Wardrobe” and Janine was chosen to portray a major role, Lucy Pevensie. She was ecstatic! The event was supposed to be launched this July 12 but due to unfortunate events, the opening play was postponed.
Janine and the rest of the production team rigorously prepared for the show for five months, six times a week, almost 24/7. There is no way the show could go wrong. In the night of July 10 on her way home however, Janine, standing by the pedestrian side walk, was hit by a reckless car. She was unconscious and was rushed to the hospital by her actor friends. The driver was proven to be under the influence of alcohol.
Janine not incurred fractured limbs and legs; she also was unconscious for a number of days. Janine was uninsured so until the negligent driver’s insurance company pays for her claims, her father had to bear all the medical expenses on his shoulders. The production company was also devastated as they had to cancel their shows.
Janine couldn’t act on the complaint immediately and file for damages during her unconscious state. Her father’s funds were drying up and he had to rely on the negligent driver’s insurance to cover up for his daughter’s medical expenses. Janine’s mother also suffered from depression seeing her daughter in a state of unconscious injury. The production company also wants to seek damages for their lost opportunity.
These third party claims were put on hold as Janine was the only party who can assert insurance claims. Until she regained consciousness, her family and production company couldn’t push through with the case. I as her trial attorney exhausted all means to give them due justice but procedural law is a tough
This law that limits liability of insurers may actually reduce bad faith claims from the insurers but in perspective, it’s inclined to favor insurers more than facilitating justice. It’s disheartening especially since insurance industry’s bad faith practices are becoming more apparent and rampant these days.