In December of 2014, the Court of Appeals of Kentucky heard a case with regard to a July 2007 car accident. (See Hollaway v. Direct Gen. Ins. Co. of Miss., 2014 WL 5064649 (Ky. App. 2014)). The plaintiff filed a claim with the defendant insurance company and demanded the policy limits of $125,000. Id. This was a low speed impact with one of the cars backing out. The total damage to the plaintiff’s vehicle was $463.42. Id.
The defendant paid the plaintiff the amount of the property damage within a few weeks even after they had not fully decided liability that it was their fault. There were competing views as to how the Kentucky car accident occurred. Further, the defendant did offer the plaintiff $5,000 to resolve her claimed injuries. Id. Plaintiff’s Kentucky car accident bad faith lawyer filed suit in May of 2008. Id. The plaintiff’s Kentucky car accident lawyer filed a claim of negligence, UIM, Bad Faith, and Kentucky Unfair Claims Settlement Practice Act (KUCSPA), alleging that the defendant had failed to reasonably evaluate, investigate, and negotiate a settlement of her bodily injury claim. Id.
It appears that at some point, the defendant paid the plaintiff $22,500 to settle her claims against the defendant driver. Id. All that remained was the bad faith claim. The defendant claimed that the Kentucky car accident was a relatively minor impact, that the parties had been wearing seatbelts, no airbags deployed, and that the plaintiff had treated for a preexisting conditions to same body regions. Id.
The plaintiff’s Kentucky car accident bad faith lawyer tried to argue that the paying of the monies demonstrated beyond dispute that the defendant acted in bad faith and with malice or in reckless disregard of her rights. Id.
A bad faith claim in Kentucky is followed under the this criteria: An insured must prove three elements in order to prevail against an insurance company for alleged refusal in bad faith to pay the insured’s claim: 1) the insurer must be obligated to pay the claim under the terms of the policy; 2) the insurer must lack a reasonable basis in law or fact for denying the claim; and 3) it must be shown that the insurer either knew there was no reasonable basis for denying the claim or acted with reckless disregard for whether such a basis existed.. An insurer is .. entitled to challenge a claim and litigate it if the claim is debatable on the law or facts. “ (cites omitted).
The insurer has tort liability for bad faith if, and only if, its liability for paying the claim in question was “beyond dispute.” (cites omitted). Absent that, an insurer has a right to defendant the case, without making any settlement offer at all, until appellate review is final. (cites omitted). In this case even though the defendant paid the property damage and even paid the plaintiff bodily injury claim, under Kentucky law, a settlement is not evidence of legal liability, nor does it qualify as an admission of fault. Id.
In the case at hand, the plaintiff’s Kentucky car accident lawyer did not prove beyond dispute that the defendant caused the car accident. Id. The defendant throughout has always contested liability.
If you have been the subject of a Kentucky car accident case, please call and speak to a Kentucky car accident bad faith lawyer at the Law Offices of Andrew Alitowski, P.A. at 888-ASK-ANDREW (888-275-2637) or contact us. We are available 24 hours a day, 7 days a week.
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