Standard Automobile Insurance Policy in New Orleans
Car accidents can result in personal injury and thousands of dollars’ worth of damages. In the state of Louisiana, all drivers are required to be covered by an automobile insurance policy. Not only may driving without insurance result in legal fines and penalties, but it will also exclude you from filing an insurance claim in the event of an automobile accident. If you do have insurance and you are involved in an accident, the coverage and compensation you can expect varies by the type and extent of your insurance policy.
Minimum Required Car Insurance in Louisiana
All Louisiana drivers must have liability coverage, which is a basic insurance policy that covers damages or injuries caused by the driver in a car accident. Policy holders have binding minimum coverage limits, which consist of:
- $15,000 of bodily injury coverage per person
- $30,000 of bodily injury coverage per accident
- $25,000 of property damage coverage
Remember, liability coverage does not typically afford the insurance policy holder any form of compensation in the event of an accident. For example, if your insurance is only liability and you are involved in an accident that you were the cause of, your policy will compensate only the other party for damages or injuries sustained, up to the limits defined in your insurance contract.
Additional Forms of Coverage
Drivers can opt to purchase additional types of insurance coverage that pay for damages and injuries otherwise not covered. These include:
- Collision coverage: This pays for any repairs your vehicle needs following an accident.
- Comprehensive coverage: This covers more general sources of damage to your vehicle, including severe weather and theft.
- Uninsured/underinsured motorists (UIM) coverage: If you are an accident caused by another driver who is uninsured or underinsured, that person may not be able to compensate you for injuries or damages. UIM coverage pays for accident-related expenses under these circumstances. UIM can be broken down into three further types, including UIM bodily injury, UIM property damage, and UIM economic-only. In the latter’s case, this form of coverage will not pay for non-economic costs, such as emotional suffering.
- Medical payments coverage: This form of coverage pays for medical expenses, as well as funeral expenses in the event of a fatal accident, regardless of who is at fault. Typically, insurance providers will pay for some predetermined period of time following the accident.
You can also opt for rental reimbursement coverage, as well as for towing and labor coverage.
Bad Faith Automobile Insurance Litigation
The purpose of automobile insurance is to help policy holders pay for unexpected financial losses. Implicit in any insurance contract between the driver and the provider is an obligation to act in good faith, which refers to a duty to uphold the terms of the contract in an honest way. Sometimes, one party or the other breaches this obligation. An insurance company, for example, may unreasonably delay or suspend the distribution of pay, or it may fail to address the holder’s claim altogether. On the other end, drivers can also attempt to defraud their insurance providers by damaging their vehicle in a way that breaches the duty of trust between the contracting parties. Under these circumstances, the person or party who breached their obligation of good faith can be filed a claim against under bad faith law.
Which statutory bad faith laws apply depends on the type of insurance coverage:
In the case of
first party insurance, which includes coverage types such as comprehensive and collision, the
insurer is contracted to directly pay the insured for certain financial
losses. In order to file a claim for bad faith, the insured must explicitly
communicate a specific dollar demand to the insurer and must warn the
company that bad faith is being asserted. The insurer then has 60 days
to pay the claim.
The case of
uninsured motorist coverage is similar in that the insured must make a claim and the insurer has 60
days to pay. However, bad faith in UIM cases differ from first party insurance
in that the company is only obligated to pay the covered loss and no more
than 25 percent of the damages caused by the uninsured motorist. Under
the UM statute, the plaintiff can also cover reasonable attorney fees.
- Bad faith in liability insurance claims usually carries with it harsher penalties. This is because an insurance company acting in bad faith can leave the insured in a situation of considerable financial exposure.
Experienced Insurance Litigation in New Orleans, LA
Peirce Hammond is a skilled and practiced attorney in insurance litigation, with ample experience in defending insurance companies. His knowledge of how insurers operate and his understanding of the laws that bind insurers and the insured will prove indispensable in your claim.
If you suspect of bad faith by part of your insurer or if you have been unjust accused of bad faith, contact the New Orleans, LA law offices of Hammond Law Firm to schedule your complimentary case review today. Call us at (504) 586-3535.