Over the past several years, we have handled cases where several people are injured as the result of one collision, and often as the result of one motorist's negligence. When several people have claims against one motorist, the injured parties are often competing for limited insurance policy proceeds. Let's start out with the basics on coverage, and go from there.
Many Oregon auto policies have "per claim" and "per accident" coverage amount limits. We often refer to these as "policy limits." For example, Oregon requires a minimum coverage of $25,000.00 "per claim," and $50,000.00 "per accident." "Per claim" means that the most the insurance company will pay for one particular claim is the policy limits of $25,000.00. "Per accident" refers to the total amount that the insurance company will pay for all claims arising from one collision.
To illustrate, let's assume that four people are returning from a night out Seaside, and on the way back to Astoria, a negligent motorist with the minimum required insurance coverage crosses the centerline, and strikes the driver and three passengers, injuring everyone.
The motorist and the three passengers have a claim against the negligent driver who crossed the centerline. However, the careless driver's insurance will only pay up to $25,000.00 for any one particular claim, and only $50,000.00 for all claims. This is regardless of the nature and extent of all the injuries, or the medical bills.
If we add up all of the medical bills for all four injured folks, they may very well exceed the $50,000.00 policy limit. In many cases, the four injured motorists will have to accept a "pro-rata" share of the available policy proceeds as full and final settlement of their claims. This could result in an injury claim settled for far less than even the medical bills, let alone adequate compensation for the loss of health.
Once again, this real life scenario illustrates the need for underinsured motorist coverage. Even if your insurance coverage limits or "policy limits" are not higher than the negligent motorist, you may still make a claim for underinsured motorist benefits.
If you or a friend or loved one is facing a similar issue, call us at 503-325-8600. We have handled many multiple party cases over the years, and can help you learn where you stand with your case.