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Washington Appeals Court Upholds $2.4 Million Insurance Bad Faith Verdict


Auto insurance companies have a legal duty to represent their policyholders in good faith. This means that if an insured driver was responsible for causing an auto accident, the insurer must make a reasonable attempt to negotiate a settlement offer presented by the victims. In most cases this means settling for the limits of the policy, as the victims’ damages often exceed the amount of coverage.

If an insurer acts in bad faith, the policyholder has the right to seek damages. This right can be assigned to the accident victims as part of a settlement of the underlying personal injury claim. The victim can then pursue the full amount of the settlement against the insurer, provided the victim can prove bad faith.

Insurer Offered Just $21,000 to Settle Drunk Driving Accident Claim

For example, a Washington appeals court recently upheld a $2.4 million bad faith judgment against National General Insurance Company. This case arose from a 2016 drunk driving accident. National insured the drunk driver.

To briefly explain what happened, the drunk driver fell asleep at the wheel. He then woke up and accelerated his vehicle, which led to the first of two collisions. This first collision was a minor rear-end contact with a vehicle driven by a woman with the last name of Sumner. The drunk driver continued accelerating following this collision and caused a second “T-bone” collision with another vehicle driven by the plaintiff in this case.

The plaintiff sustained serious injuries in the accident. He sent a demand letter to National seeking the full amount of coverage under the policy, which was $100,000. National made a counteroffer of just $21,000. The plaintiff rejected the offer and proceeded to file a personal injury lawsuit against the drunk driver. The parties agreed to settle that lawsuit for $1.5 million. As part of the settlement, the drunk driver assigned his right to file a bad faith lawsuit against National to the plaintiff.

A jury ultimately returned a verdict for the plaintiff, awarding approximately $1.4 million in damages, which with interest produced a final judgment of over $2.4 million. National appealed the verdict. One of National’s arguments on appeal was the trial judge’s decision to admit a police report of the accident into evidence.

As the Washington Court of Appeals, First Division, explained in its opinion, accident reports made by individual witnesses are typically inadmissible hearsay. But an accident report created by the police can be admitted for certain non-hearsay purposes. Here, the report was used not to prove the truth of its contents, but rather to show that National had received a copy of the police report. This was important as it helped demonstrate National failed to conduct a proper investigation into its potential liability for the accident. The judge instructed the jury that it could only consider the police report in that context. As such, as the appellate court said there was no legal error justifying a new trial.

Speak with a Seattle Personal Injury Attorney Today

Insurance companies will often stonewall even when their liability is crystal clear under the law. This is just one reason you should always work with an experienced Seattle car accident lawyer if you have been seriously injured by a drunk, reckless, or negligent driver. Contact the Emerald Law Group today to schedule a free confidential consultation.


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