When an insurance company refuses to settle, it can be a difficult situation for both the insured and the insurer. In many cases, the insurance company may be liable for the full amount of the excess judgment after trial, notwithstanding the lower policy limits. This is due to the insurance company’s duty of good faith, which aligns the insurance company’s incentives with those of its insured.
When an insurance company refuses to settle, the insured may be left with no other option than to take the case to trial. This can be a lengthy and expensive process, as the insured will have to pay for the cost of the trial, as well as any damages awarded. Additionally, the insured may be liable for any costs associated with the trial, such as expert witness fees, court costs, and other related expenses.
The insurance company may also be liable for the full amount of the excess judgment after trial, even if the policy limits are lower. This is because the insurance company has a duty of good faith to its insured. This means that the insurance company must act in the best interests of its insured and must not act in bad faith or with malice. If the insurance company refuses to settle, it may be found liable for the full amount of the excess judgment after trial.
When an insurance company refuses to settle, the insured may be able to seek damages from the insurance company for bad faith. This may include damages for emotional distress, mental anguish, and punitive damages. Additionally, the insured may be able to recover attorney’s fees and costs associated with the trial.
It is important to remember that when an insurance company refuses to settle, the insured may have no other option than to take the case to trial. This can be a lengthy and expensive process, and the insured may be liable for any costs associated with the trial. Additionally, the insurance company may be liable for the full amount of the excess judgment after trial, even if the policy limits are lower. This is due to the insurance company’s duty of good faith, which aligns the insurance company’s incentives with those of its insured.
