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Car Crash UIM Policy Will Pay Max Even After Two-Year Delayed Acceptance

November 16, 2012 by The Parrish Law Firm

A northern Virginia plaintiff who accepted a settlement from an insurance company almost two years after it was offered will get the maximum under the policy despite the elapsed time, reports Virginia Lawyers Weekly.

William Calvert, who suffered a car accident in 2009 that led to $75,000 in medical bills and lost wages, will receive $25,000 from his UIM (underinsured motorist coverage) in addition to a previously awarded $100,000 from the negligent driver’s liability carrier.

Hopewell Circuit Judge Nathan Lee awarded the payout on Nov. 9th despite the arguments made by the UIM carrier’s lawyer that the decision goes against Virginia state law, which does not treat an offer as indefinitely open.

INS Insurance, the company which covered Calvert under the UIM policy, offered him $25,000 on Nov. 24th, 2010, eight days after the liable party’s insurance company, Farm Bureau Insurance, offered him $100,000 providing there was a waiver of subrogation from all UIM suppliers.

Calvert’s attorney accepted the offer for $125,000 total on Sept. 7th, 2012, which included the $25,000 payment from INS. However, INS claimed that the offer was a unilateral mistake, and so Calvert attempted to have the settlement imposed in court.

Judge Lee went through Virginia contract law and found that unless an offer is accepted within a sensible time period, the law presumes it is withdrawn when it is made without time guidelines dictating how long the offer remains valid.

However, Lee could not find a Virginia case that handled issues similar to those of Calvert and INS, and so he examined law from other jurisdictions and determined the “accepted industry standards.” He found that a “lapse of almost two years between the settlement offer by both Farm Bureau and INS and Plaintiff’s subsequent acceptance is not an unreasonable delay… it is common industry practice to treat offers from insurance carriers as open and continuing until they are withdrawn or rejected.”

Lee noted that Calvert’s lawyer did communicate with the INS adjuster by telling her that he and Calvert were continuing to look the offer over.

Eric S. Jensen, the lawyer representing INS, stated that Judge Lee’s reasoning was flawed; firstly, because the offer became stale due to the prolonged period of time that passed, and secondly, Calvert essentially rejected the offer by filing an additional suit. However, Jenson at this point has no plans to appeal the court’s decision.

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