We get asked all the time, what should I do if someone sues me for a car accident in Ontario, or what if someone sues my insurance company? If you are responsible for another person’s injury or financial loss due to his carelessness or negligence, that person may file a lawsuit against you. however, assuming you have auto or home insurance, your insurance company will pay that claim.
Can an insurance company sue me?
When someone sues your insurance, that injured party is not actually suing your insurance company by name. they sue you personally and your insurance company answers the claim on your behalf.
If you injure someone in a car accident, or if someone slips and falls on your icy driveway, you may receive a letter from the injured party notifying you of a claim. This letter can be informal or it can be a formal letter from the other person’s attorney asking you to contact their insurance company. in effect, the injured party or their attorney is letting you know that your insurance is being sued or, more accurately, going through you to get to your insurance company.
working with your insurance company
When you are sued for a car accident and you have insurance, you must ensure that your insurance company will respond to any claim, you must contact them immediately and fully cooperate with them. if you don’t, some of the insurance coverage you paid for may not be provided, due to late notification to the insurance company (denying them the opportunity to investigate and respond to the claim in a timely manner).
in the case of an insurance company refusing to cover you or covering you for less than the full insurance policy limits, either because you notified them late, did not notify them at all, or perhaps knowingly provided them to you with false information when applying for insurance (known as a “material misrepresentation”), you may find yourself partially or entirely personally liable to the injured party for your losses. You don’t want to have to sell your personal assets or refinance your home to pay an injured party’s claim. That’s why it’s important to be honest with an insurance company when applying for a new policy and to cooperate with them fully.
The insurance company will investigate the claim and try to resolve it at an early stage. If the claim is for significant injury or financial loss, your insurance company may need to retain an attorney to handle the case. either way, you and your personal property will be protected up to the limits of your policy.
Most auto and home policies in Ontario have $1,000,000 liability coverage, which is adequate in all but the most severe cases.
what to do if someone sues you for a car accident in ontario?
When someone sues after a car accident, if an insurance adjuster is unable to settle the claim early, you may receive a statement of claim, which is the first step in personal injury litigation. You may be wondering why you are personally named on the claim, even though you have insurance coverage. That’s because an injured party cannot directly sue their insurance company, since the insurance company did not directly cause any injury or financial loss. Your insurance policy responds to a claim because you bought that policy for peace of mind in case you accidentally injure someone and get sued as a result.
if a claim proceeds to litigation
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If someone hands you a statement of claim, don’t panic. just contact your insurance company, provide them with a copy of the claim, and they’ll handle it. they will retain an attorney to act on her behalf (although he or she is actually acting on behalf of your insurance company to ensure that you pay as little as possible to settle the claim). The adjuster or the insurance company’s attorney, or both, may meet with you at various times to discuss what happened to cause the other person’s injury and to explain the litigation process, beginning with the statement of claim.
what if someone sues you for more than your insurance company covers?
In rare cases, an injured person may claim more than their insurance policy limits. Let’s say, for example, that you are involved in a car accident in which another person is paralyzed and requires considerable medical attention, but also loses their ability to work. that person’s claim could be significantly higher than his $1,000,000 liability limits, in which case he must obtain separate legal representation to protect her personal assets. Note that one way to avoid this unlikely scenario is to pay for additional insurance. he can get $2,000,000 or even $3,000,000 of liability coverage for a little more than he is paying now. You can even get an excess “umbrella” policy for both your car and your home that covers you for several million dollars if someone is injured by you in a car accident or on your property. It’s a good idea to talk to an experienced insurance broker about this excess coverage.
If litigation proceeds, your attorney and your insurance company will guide you and prepare you for the subsequent steps in the litigation process:
- discovery exams, in which you are asked under oath in a boardroom about how the injured party was hurt
- exchange of documents, where you may need to provide the insurance company’s attorney with information and documentation relevant to the case
- before trial, where the parties meet with a judge to discuss the case and whether it can be resolved (usually you would not be personally involved in this)
- trial, where you would testify on the witness stand about the circumstances that started the lawsuit in the first place
What happens if someone sues your insurance company? or more accurately, if your insurance is being sued using your name? Contact your insurance company immediately, fully cooperate with them and your attorney, and in the unlikely event that the value of the claim is greater than your policy limits, seek your own attorney to protect your personal assets.
updated content: originally published on July 3, 2018
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