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The following is a list of terms (and definitions) often used by attorneys and insurance claims adjusters when talking about automobile collision matters. If you are familiar with some of these, your understanding of the process and your comfort level throughout it will be enhanced.
1. Insurance coverage terms.
Liability – This is how much coverage you have if you cause a collision, that is, the amount your insurance company is “liable” for. This coverage is shown to you on the “Declarations” page of your policy. This coverage is typically shown with a slash “/” separating two numbers, such as: 25/50, or 100/300. These numbers are in thousands of dollars, so the 25 means $25,000.00. The first number is the amount your company would be responsible to pay, at a maximum, to any single person who got hurt in the collision. This is called the “limit”. The second number, to the right of the slash, is the total amount the insurance company could be made to pay to all individuals, in total, who got hurt in the collision.
Uninsured, or “UM” coverage – An automobile coverage allowing for recovery when one is injured due to the negligence of another, when that at fault party does not have liability insurance coverage. In Virginia and in Maryland, the policy limits are most often identical to the liability limits discussed above.
Underinsured, or UIM coverage – An automobile insurance coverage where one may make a claim to recover damages in excess of the policy limits of the negligent party.
MED-Pay / Medical Expense Benefits / Virginia only – This is an optional, but very important and (I believe) necessary coverage on your automobile policy which covers medical bills. This coverage has limits, typically in increments of $1,000.00. This is a provision which pays medical bills in the event you get hurt in a collision. It has nothing to do with fault. Using this coverage will not increase your premium and the company cannot cancel your policy for providing these benefits.
PIP / Maryland only – Stands for “Personal Injury Protection”, and is the same as Virginia Medpay, but also covers wage losses. Typical coverage begins at $2,500.00.
2. The insurance players.
Agent – This is the person who sold you your insurance policy. He or she has nothing to do with claims, and if you are intent on not using the services of an attorney, you should report a collision to the company, as it is more direct and will provide a more efficient path to results.
Appraiser – This is the insurance company representative who estimates the repair cost of your damaged car. This person is also the one who will decide if your car is a total loss.
Adjuster – The person who negotiates settlement for the insurer. They are often attorneys.
Supervisor – This is the individual who the adjuster tells you must approve the settlement offer. Often this is a ruse to stall or delay your case, such that the adjuster appears to be trying to help you, but bad offers or delays are the fault of the supervisor who won’t approve more money, or who isn’t in to approve the settlement offer the adjuster says he or she wants to make.
Committee – This is the group of people at the insurance company who approve larger settlements. See discussion on Supervisor to get an understanding of how the process works.
3. “Car Stuff”.
P.D. – Property damage; relating to the damage to your car
Total – Means that the cost to repair your car is 70% (sometimes 80%) of its value, and thus, not “worth it” to fix it. (Example: Car’s current value is $10,000.00, and repair costs exceed $7,000.00). Accordingly, the insurer pays you the value of the car.
Salvage Value – If your car is declared a “total loss”, and you want to keep it, the insurance company will deduct the scrap, or salvage value, of the parts, the metal, etc., and give you the difference. (Example: Car’s current value is $10,000.00; car’s scrap value is $1,500.00; insurer gives you $8,500.00).
PDW – Physical Damage Waiver. When you rent a car, the rental company will want you to “purchase” the PDW, so that if something happens to their car while you have it, there is insurance to pay for the damage. Typically this cost is anywhere from $6.00 to $12.00 per day. If you have collision coverage on the insurance policy covering your car (the one that was in the collision), you should sign and initial on the rental contract indicating YOU DO NOT WANT to pay the extra charges, and that you “waive” the “physical damage protection”. Your insurance will cover you in the event something happens to the rental vehicle.
4. Miscellaneous Insurance Terms.
Liability – Different than under the Insurance Coverages section, this word in general usage refers to a determination of fault.
BI claim – Meaning “bodily injury” claim. The claim you have for money for your injuries, medical bills, lost wages, pain and suffering, and anything else that isn’t related to your car.
PD claim – Property damage claim. The claim you have for repair of your car, or payment for it if it is a total loss, and for rental car reimbursement.
1st party claim – Claim you have against your insurance company for Medpay or PIP.
3rd party claim – Claim you have against the other guy’s insurance company for BI & PD.
Specials – The total value of your medical bills and lost wages.
Claimant – This is you. You are “claiming” benefits.
IME – This is translated “Independent Medical Exam”. I like to call it Defense or Insurance Medical Exam. Often, insurers will require under the terms of your policy, when you apply for Medpay or PIP benefits, that you attend an examination with a physician of their choice, to allow them to confirm that you are indeed injured, and that you need medical care. Equally as often, the Liability Insurer will want this type of examination, by their chosen doctor, for the same purpose. (We don’t always agree to let the Liability Insurer’s doctor examine our clients).
5. Some Legal Terms.
Plaintiff – This is you once you file a lawsuit.
Defendant – The person who is being sued by the Plaintiff
Subrogation – An insurance company’s right to be repaid once another responsible party pays you. Common example is health insurance company which pays your medical bills. Once the other guy’s insurance pays you, your health insurance company wants to be paid back.
Tort – Acts or omissions that interfere with somebody’s freedom to enjoy their personal or property rights. An example of a “tortious” act would be rear-ending somebody’s car. An example of a “tortious” omission would be not mopping up a spill on a floor in a grocery store.
Negligence – The failure to use reasonable care.
Contributory Negligence – Used as a “bar” to recovery in Virginia and Maryland. This is the allegation from the other party or their insurer that both parties “contributed” to the collision. In these cases, neither party can make a claim against the other.
Litigation – Process of filing a lawsuit and going to court.
Arbitration – A hearing which is held, generally less formal than a trial, where the parties have an independent person, called the Arbitrator, decide the case after evidence is presented. Arbitration can be binding, or non-binding. Often “limits” are set in advance as to the “high” and “low” values for your claim. A decision by the Arbitrator for an amount more than the high limit will result in the claimant being paid only the high limit. Contrarily, an award for less than the low limit results in the claimant getting the previously agreed low limit.
Mediation – A settlement tool similar to Arbitration, but generally not involving testimony or evidence. A Mediator attempts to help the parties settle the case through negotiation.
6. Legal Terms when you go to court.
If filing a lawsuit becomes necessary, there are numerous terms which you will then be exposed to. Some of these are as follows:
Statute of Limitations – Period of time within which legal action can be taken. If action (filing a lawsuit) is not taken within that time period, the claim legally “dies”, and no claim can then be brought. In Virginia, the Statute allows two (2) years after the injury occurs; in Maryland, it is three (3) years.
Pleading – Any document filed with the court.
Motion For Judgment – In Virginia, this is the name of the lawsuit you file for damages.
Complaint – In Maryland, this is the name of the lawsuit you file for damages.
Answer – This is the response of the Defendant to your lawsuit for damages.
Discovery – This is a broad term which is the process for each side finding out about the other side’s information. This includes everything, even if such information cannot be used in court. Things typically “discovered” about you are your medical history, your employment history, how you maintain the collision occurred, your injuries, your medical treatment, the medical bills you incurred, your current employment information and the losses you claim, your private life leisure and enjoyment activities (and those you claim have been changed due to your injuries), and more, if the other side believes it might help them assess your case fully. Things typically “discovered” about the Defendant are driving history, his or her version of how the collision occurred, employment matters if they were on duty at the time of the collision, and more, again, depending upon what may be important to assess the strength and weakness of the defense.
Interrogatories – These are written questions which the parties to the lawsuit must answer, under oath. These are “discovery” questions. See explanation above for what they may contain.
Deposition – This is an in-person question and answer session, where the attorneys are allowed to ask parties and other individuals about matters relating to the case. Again, this is part of the “discovery” process. The answers given by the “deponent” are under oath.
Hearsay – This is an “out of court” statement which is being offered by someone in court, to attempt to prove the truth of the matter asserted. Hearsay statements are generally not allowed because there is no way to “test” the truthfulness of them. An example is someone (call him Fred) saying in court that someone else (call him Bruce) said the traffic light was red. There is no way to “cross examine” Bruce, to see if he really saw the light red, where he was when he saw it, etc. Clearly, the purpose of Fred saying Bruce said the light was red is to try to prove that the light was in fact red. Thus, hearsay is generally not allowed, and that means that in court, people testifying cannot say what other people said.
Objection – We’ve all seen enough TV shows to know what this is, but, it is simply one attorney objecting to something going on in court, and asking the judge not to allow whatever it is that is being objected to, to be allowed as evidence or to be shown to the jury.
Sustained – This is the judge’s ruling on an objection, agreeing with the attorney making the objection, hence the thing or statement being offered by the other side will not be allowed.
Overruled – This is the judge’s ruling on an objection, disagreeing with the attorney making the objection, hence the thing or statement being offered by the other side will be allowed.
Subpoena – This is a court order requiring attendance. Typically it is issued to individuals to appear at depositions, and for witnesses to appear at trial.
Subpoena Duces Tecum – This is a court order requiring production of documents or things. Typically this accompanies a subpoena and involves bringing documents such as tax returns, medical bills, etc.
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