North Carolina Auto Accident & Insurance Law

NAGLE

Copyright © 2014 Carl Nagle.

All rights reserved. No part of this book may be reproduced, stored, or transmitted by any means—whether auditory, graphic, mechanical, or electronic—without written permission of both publisher and author, except in the case of brief excerpts used in critical articles and reviews. Unauthorized reproduction of any part of this work is illegal and is punishable by law.

ISBN: 978-1-4834-1755-4 (sc)

ISBN: 978-1-4834-1756-1 (e)

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Lulu Publishing Services rev. date: 08/29/2016

CONTENTS

Foreword

Chapter 1 Money Sources for Accident Victims

Auto-Insurance-Based Payment Sources

and Coverage Types

Liability Insurance Coverage

Advice on Buying Liability Insurance

Excess Liability Coverage—Accessing Multiple Auto Policies

Uninsured Motorist Coverage

Don’t Worry about Your Premiums

Stacking Multiple UM Policies

Avoid Partial Settlements

Advice on Buying Uninsured Motorist Coverage

Underinsured Motorist Coverage

Stacking UIM Policies

Collision/Comprehensive Coverage

Medical Payments Coverage

Don’t Worry about Your Premiums

Medpay Coverage Allows Duplicate Payments

Available Medpay Coverage Options

Avoid Attorneys’ Fees on Medpay

Stacking and Accessing Multiple Medical Payments Policies

Medical Payments Coverage Exclusions

Personal Injury Protection (PIP)

Rental Reimbursement Coverage

Accidental Death and Dismemberment

Money from Sources Other than Auto Insurance

Commercial/Business Insurance Policies

Tractor-Trailer Insurance Policies

Homeowner’s Insurance—Umbrella Coverage

Health Insurance

Workers’ Compensation

Employer-Provided Sick/Vacation Pay

Short-Term and Long-Term Disability Policies

Aflac and Other Accident-Triggered Policies

Crime Victims Compensation Fund

Federal Funds—US Agent Causes Accident

State Funds—NC Employee Causes Accident

Personal Wealth and Assets of Responsible Parties

Chapter 2 Buying Auto Insurance and

Understanding Your Policy Contract

Buying Auto Insurance

How to Find the Best Insurance Company

Finding Coverage at the Best Price

Contents of the North Carolina Auto Policy

Policy Application

Coverage Binder

Policy Declarations

Policy Jacket

Endorsements/Addendums

How to Read Your Auto Insurance Policy

Answering Coverage Questions

Chapter 3 Steps to Take after an Accident—Plan

of Action, Common Accident Causes,

Apply NC Traffic Laws, Consider Hiring a

Lawyer, and Determine Who Owes You

What to Do After an Accident

Take Scene Photos

Secure Witness Identification(s)

Secure Police Contact Information

Secure Vehicle Photographs

Secure Immediate Medical Evaluation

Secure Early and Ongoing Injury Photographs

Review Police Reports Early

Identify All Parties Who Owe for Your Accident Claims

Report Claims to Insurance Carriers

Do Not Sign Medical Authorizations for Insurance Adjusters

Avoid Providing Written/Recorded Testimony to Insurance Adjusters

Settle Property Damage Claims without Discussing Your Injuries or Your Medical Care

Keep a Journal

Retain Pharmacy Receipts

Do Not Provide Medical Receipts/Records/Bills to the Adjuster until All Medical Treatment Is Completed

Document Out-of-Pocket Expenses

Secure Medical Excuse for Lost Work Time

Attend All Scheduled Medical Appointments

Use All Personal Health Insurance Coverage to Fund Medical Care

Determine Whether Your Health Insurance Carrier Has Claims against Your Settlement

Secure Medical Proof of Injury Permanency and Future Medical Care Costs

Secure Economic Proof of Lost Earning Capacity

Speak with at Least One Accident Attorney as Soon as Possible

How a Lawyer Might Help

How the Attorney Is Paid

Common Accident Causes

Relevant Motor Vehicle Accident Law

North Carolina Negligence Laws

North Carolina Traffic Laws—Rules of the Road

Federal Law—Commercial Vehicle Accidents

Determine Who Owes for Your Accident Claims

Chapter 4 Vehicle and Personal Property Damage Claims

Lawyers Are Typically Not Necessary

Property Damage Releases Are Final

Personal Property Loss Other than Vehicle

Vehicle Damage Claims

Source of Coverage—Which Insurer Owes?

Repair Versus Total Loss

Vehicle Repair Claims

What Is Owed

Allowable Use of Used or Reconditioned Parts

Choosing a Repair Facility

Rental Car Versus Loss of Use

Approving Body Shop Repairs—You Are the Customer

Paying the Shop

Diminution of Value

Statutory Diminution of Value Claims

Total Loss Claims

How Total Loss Value Is Determined

Confirming the Adjuster’s Total Loss Value

Challenging the Total Loss Offer

What Is Included in the Total Loss Payment

Effect of Vehicle Lease/Financing

Towing and Storage Charges

Rental Car Obligations

Documents Involved in a Total Loss Claim

Retaining Your Salvage Vehicle

Unique Vehicle Cases

Rare and Collectible Cars

Motorcycles

Scooters and Mopeds

Bicycles

Chapter 5 Injury Claims

Author’s Words of Warning

How Attorneys Increase Injury Claim Payments

Nature of the Injury Claim

Summary of Damages Owed to the Injury Victim

Maintain the Threat of Trial

How to Approach Initial Medical Treatment

Collision Scene and First Responder Treatment

How to Pay for Thorough Medical Care

At-Fault Driver’s Liability Insurance

Private Health Insurance

Medicare and Medicaid

Military Benefits and Tricare

Medical Payments Coverage

Workers’ Compensation

Seeking Medical Treatment on Private-Pay / Credit Basis

Proper Medical Care & Your Injury Claim

Report All Symptoms to Your Doctors

Follow the Medical Path to Conclusion

The Missed Appointment Trap

The Importance of Medical Specialists

The Injury Claim Process

Dangers of Early Settlement and Scheduled Releases

Hidden Traps in the Scheduled Release

Settlement—Timing and Deadlines

Proper Injury Case Presentation

Elements of Evidence in the Injury Claim

Who Receives Your Settlement Demand

Proving and Collecting Medical Expenses: Billed Versus Paid—Tragic North Carolina Tort Reform

Placing a Value on the Injury Case

Injury Claim Settlement Process

Negotiating toward Settlement

Settlement Versus Trial

Injury Claim Settlement Documentation

The Vanishing Settlement

Outside Claims against Settlement Proceeds

Taxes on the Injury Settlement

Chapter 6 Common Traumatic Injuries

Evidence and Case Value Considerations

Abrasions and Lacerations

Scarring and Disfigurement

Fractures—Broken Bone Cases

Brain, Spinal Cord, and Nervous System Injuries

Back Injury

Facial Injuries

Dental/Tooth Injuries

Chest Injuries

Abdominal Injury

Clavicle/Collarbone Injury

Shoulder Injuries

Hand and Wrist Injuries

Hip Injury

Knee Injury

Foot Injury

Chapter 7 Litigation and Trial

Parties in the Civil Action

Choice of Venue

Suit Filing Deadlines and Procedure

District Court Versus Superior Court

Small Claims Court

Federal Court

Defendant’s Initial Court Filings

The Discovery Process

Scope of Discovery

Tools of Discovery

Benefits of Discovery

Mediation—Settlement After Suit Is Filed

Offer of Judgment

The Jury Trial

Special Proceedings

Chapter 8 Unique Accidents and Special Cases

Injury of a Minor Child

Structured Settlements

Uninsured Driver Accidents

Underinsured Motorist Claims

Hit-and-Run Accidents

Phantom Vehicle Accidents

Motorcycle Accidents

Moped / Motor Scooter Accidents

Bicycle Accidents

Pedestrian Accidents

Eighteen-Wheeler—Tractor Trailer Accidents

Commercial Vehicle Accidents

Drunk Driving and Punitive Damage Cases

Animal in the Road Accident

Fatal Injury & Wrongful Death

Elements of a Wrongful Death Claim

Proving & Collecting All Damages

The Role of the Estate Representative

How Family Members Divide a Wrongful Death Award

Wrongful Death Case Defenses

Wrongful Death Case Filing Deadline

How to Divide and Pay Out Wrongful Death Funds

After working for years in the insurance industry, I felt a calling to educate and assist accident victims. Through this book, I offer my guidance and experience to victims of vehicle collisions. This work is dedicated to the wonderful clients who have allowed me to assist them through their medical recovery, and to help them resolve all financial and legal problems arising from motor vehicle accidents. Thank you dear clients for giving me the opportunity to serve you.

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FOREWORD

I dislike insurance companies. Through their advertising, they encourage us to trust them after an accident occurs. However, they remain detached and uncaring, and they only look to maximize profits for their executives and shareholders.

Before law school, I worked for several years as a claims adjuster for a large, national auto insurance company. I was trained to avoid payment of valid claims. Insurance adjusters are cost-control experts who will offer words of kindness and then pay you as little as you let them. Frankly, nice guys finish last when dealing with insurance adjusters after an accident.

I also worked as an insurance company lawyer defending at-fault drivers who faced valid lawsuits filed by accident victims. With my past experience, I can confirm that insurance companies always seek to minimize payment to innocent victims.

This book is offered to help level the playing field. Whether you hire an attorney or handle your case alone, you need to know the rules of the game before you can assess payment offers on all accident claims. Insurance companies hold on to your money by leveraging superior knowledge, by questioning valid claims, and by putting you in the uncomfortable position of defending your credibility. If you know your rights, you can meet the insurance adjusters on even ground. If you understand what you are entitled to and how to access multiple insurance policies to collect the full value of all allowable accident claims, you will not leave your money in the insurance company’s bank account when your claim file is closed.

North Carolina collision law is quite complex. As a practicing attorney who only handles auto accident cases, I must caution you that no single book can provide complete legal advice to every accident victim. This book, however, will help you to prepare for your discussions with insurance adjusters. If you choose to hire an attorney, this work will help you understand all of the steps your attorney should take to earn his or her fee, to increase your settlement, or to collect full case value through a jury trial. If you handle your case without an attorney, this book will help you to confront most of the pitfalls and payment-avoidance techniques that adjusters use in every injury case.

Money is far less important than health, safety, and quality of life. However, money is the only focus for insurance companies and the adjusters who represent them. Insurance companies know that accident victims have legal rights and that the law allows the victim to collect money for various expenses and losses. While you seek to focus on recovering your health, the insurance adjusters are solely concerned with minimizing their financial obligations. From the first report of a covered accident, they begin collecting evidence that allows them either to deny your claims or to reduce what they owe. They will not openly explain what you can collect, and indeed, they will keep your money if you do not know what to ask for.

I truly hope this work helps you to understand your legal rights, your legal options, and your best plan of response following a motor vehicle accident. If you have questions about your rights or options or if you need help applying this text to your unique circumstances, I can be reached by telephone at (800) 411-1583 or online through www.naglefirm.com. No accident victim should feel alone when responding to a collision. This book provides immediate guidance, and I hope that you gain every advantage as you seek to protect your family’s health, credit, and financial interests.

Carl Nagle

CHAPTER 1

MONEY SOURCES FOR ACCIDENT VICTIMS

After an accident, one of the first questions you face is who will pay for your expenses and losses. A discussion of the sources of payment involves analysis of the various types of insurance policies that fund auto accident claims. While car insurance policies fund most claims, there are additional outside sources that must be considered in cases involving serious injuries and higher damages.

We will explore all of the sources that might provide payment to your family following an auto accident. We begin with a general discussion of the types of coverage provided through auto insurance policies: liability insurance, uninsured motorist coverage, underinsured motorist coverage, collision coverage, medical payments coverage, and personal injury protection. We will then look at non-auto-based insurance and other outside payment sources that provide essential additional payments to victims who suffer more serious injuries. Because duplicate payments are often allowed, victims should look at every money source as they seek full and fair payment for expenses and losses arising from a motor vehicle accident.

Auto-Insurance-Based Payment Sources

and Coverage Types

In chapter 2, we look at the North Carolina standard form auto policy and discuss the basic legal principles of insurance. In this chapter our focus is on how each of the coverage types is triggered, and what the insurance companies owe under each section of the insurance policy. Since multiple coverages can often be accessed, each money source should be considered to determine whether duplicate coverage and duplicate payment of covered losses might be available.

Liability Insurance Coverage

Liability coverage protects other drivers and individuals if you cause an accident. This is mandatory coverage and will be part of every auto insurance policy issued in North Carolina.

Liability means legally responsible. To collect from another driver’s liability insurance, you must prove that the other driver was careless or negligent. You must also show that you did not contribute to causing the accident. Beware in North Carolina because our pure contributory negligence law is the most difficult negligence law in the country. If you are slightly at fault for the accident (even just 1 percent to blame), you have no claims or right of payment. Never admit blame or responsibility in discussions with insurance adjusters and other drivers.

Liability insurance follows the vehicle in North Carolina. If you are driving your own car, your personal auto policy will provide liability coverage if you cause an accident. If you are driving a borrowed car, the car owner’s liability policy is first in line to pay for the damages caused to other parties. All victims will present their claims under the policy covering the at-fault vehicle. If multiple drivers and vehicles are responsible for causing the accident, claims can be presented against multiple policies. This allows you to add all available liability coverage together and increase the insurance money available to pay your claims.

Example

John and Andy are both driving separate vehicles and both enter the same intersection under a red light. Alice enters the intersection under a green light and is struck by John and Andy. Alice’s injuries and losses are caused by the combined negligence of two drivers. Therefore, she can collect from John’s liability policy and Andy’s liability policy.

The two types of liability coverage found on every policy are property damage liability and bodily injury liability. Property damage coverage pays for all vehicle damage and other personal property loss. Bodily injury liability is separate coverage for physical injuries caused in the accident. Only innocent victims can collect, including other drivers and all innocent guest passengers. The coverage for bodily injury is typically split-limits, with a single per-person limit and a per-accident limit on the same policy. The per-person limit is the most any single victim can collect from that policy, regardless of the extent of medical care costs or the severity of injury. The per-accident limit is the most any group of victims will receive for all injury claims arising from a single accident or occurrence.

Liability coverage on auto policies is typically issued in the following amounts:

• property damage—$25,000.00

bodily injury per victim / per occurrence—$30,000.00/$60,000.00

• property damage—$50,000.00

bodily injury per victim / per occurrence—$50,000.00/$100,000.00

• property damage—$100,000.00

bodily injury per victim / per occurrence—$100,000.00/$300,000.00

• property damage—$100,000.00

bodily injury—$300,000.00 combined single limit

• property damage—$100,000.00

bodily injury—per victim / per occurrence $250,000.00/$500,000.00

• property damage—$250,000.00

bodily injury—per victim / per occurrence $500,000.00/$1,000,000.00

Advice on Buying Liability Insurance

If you cause an accident, you are personally responsible to pay for all vehicle damage, personal property damage, victim medical care costs, victim wage loss, and for all victims’ pain and suffering. Car accidents cause serious injuries, and the victims’ claims can easily exceed $100,000.00. If you do not purchase enough coverage, a victim can sue you and secure a verdict for the full value of all losses. If your insurance is not sufficient to pay the verdict in full, they can levy and take your bank accounts and personal property, place a judgment lien on your home, and collect the uninsured portion of their verdict from your personal wealth.

Always carry enough insurance. This determination depends in part on the personal wealth and assets you have to protect. We recommend that any driver carry at least $100,000.00 per person / $300,000.00 per occurrence in bodily injury liability coverage.

The cost of a single emergency room visit following a serious accident can approach the state’s required minimum liability coverage limit. Thus, even if you have little wealth to protect, it costs very little to increase your coverage limits above the state minimums. If you carry sufficient coverage, you can trust that your insurance carrier will have sufficient resources to resolve almost any claim that follows a typical car accident.

Excess Liability Coverage—Accessing Multiple Auto Policies

Accident victims often fail to present their claims and collect under all available insurance policies! They leave their money in the insurance company’s hands simply because they don’t know where to look for additional coverage and benefits. If the insurance coverage on the vehicle is not sufficient to pay victim claims, it is essential to look carefully to identify hidden policies that will help to fund your claims.

Later in this chapter, we discuss excess liability coverage scenarios that do not involve auto insurance, including commercial/business liability insurance (which applies when an employee causes an accident during work hours) and homeowner’s umbrella insurance. These nonauto sources are typically high-limits policies that provide a great deal of money to cover your losses and expenses. In serious and catastrophic injury cases, always look for these hidden policies, as they provide large money sources to cover your claims.

Example: Hidden Policy Pays $550,000.00!

We represented Carol F., who approached us following an accident. She and her husband had already secured a policy limits offer of $100,000.00. They simply wanted our advice to confirm that this was the only money available. After performing an asset search, we determined that the at-fault driver had very little wealth and no real estate to pursue. However, we looked closely at the collision facts and noticed that the at-fault driver was driving a late-model pickup truck at lunchtime near downtown Raleigh. On suspicion that he may have been employed, we compelled the liability insurer’s legal representatives to secure a sworn affidavit from the at-fault driver disclosing the nature of his journey and his point of origin and destination, identifying his employer, and confirming whether he was within the scope of his employment when the crash occurred. After learning that he was employed, we were able to collect an additional $575,000.00 from the employer’s commercial liability policy for Carol. Before they secured the advice of counsel, they were very close to signing a release limiting their payment to the initial/primary coverage. This release would have barred all additional claims. Thankfully, the hidden excess commercial policy paid over a half million dollars in additional benefits for Carol’s family.

The most common excess liability scenario is the borrowed vehicle accident. Liability insurance follows the vehicle in North Carolina. If a driver borrows a nonowned vehicle and causes an accident, the first source for payment of victims’ claims will be the vehicle owner’s policy. If the owner’s policy is insufficient to pay all losses, the driver’s personal auto policy provides secondary or excess liability insurance. This coverage is called excess because it pays only after all coverage for the primary policy (the policy covering the at-fault vehicle) is paid out and exhausted.

Example

John borrows Andy’s car to run errands. John causes an accident after he disregards a stop sign and collides with Alice. The primary policy covering Andy and Andy’s car provides the state minimum mandatory liability coverage of $30,000.00 per person for bodily injury. John has his own car insurance with bodily injury liability coverage of $100,000.00 per person. The total liability insurance available to pay Alice’s injury claims is $130,000.00. If Alice’s injury claims are valued at $90,000.00, John’s primary policy pays the first $30,000.00. Andy’s personal auto policy provides excess liability coverage to pay the additional $60,000.00.

Another common excess liability scenario is the extra liability policy in the driver’s household. The accident victim should request the policy information for every family member (person related by blood or marriage who resided with the at-fault driver on the accident date) whenever the value of the injury claim exceeds the coverage limit available on the policy that covers the at-fault vehicle. If the at-fault driver has his or her own policy, this coverage would be second in line behind the vehicle policy to pay victim losses. If these two policies are not sufficient to cover all injury claims, family members’ auto liability policies will often provide additional, excess coverage to pay the victim’s claims. Be sure to look for all coverage to ensure that your claims are paid in full.

Beware of any partial settlements in excess liability cases! If multiple liability policies protect the at-fault driver, you must settle your claim with one single settlement against all liability carriers. If you sign a release to collect under just the primary policy, this release waives and stops all claims against any available excess coverage. Whenever you are facing a policy limits settlement offer that does not fully pay your claims, take the time to scrutinize the collision facts, vehicle ownership facts, and the driver’s employment and wealth before you accept the policy limits offer that leaves your losses only partially paid.

Uninsured Motorist Coverage

Uninsured motorist (UM) coverage pays the claims of all victims who are injured by a driver who failed to pay premiums and carry insurance and victims of hit-and-run drivers. Under the UM policy, you may claim payments for car and personal property damage under the uninsured motorist property damage (UMPD) coverage, and you can also collect for all injury claims under the uninsured motorist bodily injury (UMBI) coverage.

In hit-and-run cases, you cannot use the uninsured motorist coverage to pay for your property damage. This is unfortunate because the collision deductible is almost always higher than the standard $100.00 deductible that applies to UMPD claims. Also, in