Today’s Post March 16, 2012 – The legal philosophy that a person is completely responsible for his or her negligence seems to be under heavy criticism these days. The question really is; “is a single moment of negligence responsible for a lifetime of lost earnings or poverty producing medial costs too great a price to pay?”.

Few drivers fully understand auto insurance.  As the need for financial responsibility has become a financial necessity, Auto insurance has come to be regarded as a means of reimbursing Bodily Injury and Property Damage resulting from the cost of At Fault Accidents.  Actually, this may not be entirely true.  Auto Insurance Liability Coverage protects the insured against a liability expense for his or her negligence. The Auto Insurance Company will completely fulfill its obligation when a release is signed by the claimant of the at fault accident.  This means, in the situation when a claim has been brought against a negligent driver and her or she maintains an auto insurance policy, the claiming party waives their right to bring suit against the negligent party personally.  They will accept the payment provisions of the negligent parties car insurance limits of liability as full and complete payment. At least one driver in any car accident cannot legally be reimbursed under terms of the typical car insurance liability policy.  This feature of our common law system is the reason for both spirited criticism and defense of the car insurance system.

Actually, the argument involves the principle of tort law. This legal philosophy that everyone is responsible for his or her negligence gave birth to the car insurance liability industry.  A major point of criticism is the number of motorists who are unable to recover losses resulting from bodily injury. A recent study of auto injuries shows that less than 37% were compensated under the tort law. Of the total, about 1/2 were the negligent drivers and their guests.  The remaining 15% probably had insignificant  claims. Among those seriously injured, only 45% were compensated under the terms of the state tort laws. Defenders of the state tort system argue that negligence deserves no reward and at fault drivers should not be compensated. They point to drunken drivers and road racers as beneficiaries of a system that compensates without regard for fault.

-Mike 

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
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