Massachusetts Appellate Court Upholds Dismissal of Lawsuit Alleging that Insurer Engaged in Bad Faith Settlement Practices

Massachusetts requires drivers to maintain an insurance policy. This means that if you are involved in an auto accident, you will probably have to deal with your insurance company, the other party’s insurance company, or both. There are certain practices and procedures that an insurance company must follow in order to treat the involved parties fairly. As experienced Boston car accident lawyers, we have seen that many insurers attempt to cut corners in bad faith or to ignore these rules entirely in an effort to save money.

In a recent appellate case, the court examined whether an at-fault party’s insurance company made a reasonable settlement offer before the matter proceeded to a jury trial. The underlying accident involved in the appeal occurred when a woman was struck by a motorist while walking. The insurance company for the motorist deemed the woman more than 50 percent at-fault for her injuries, based on information suggesting that she stepped out from between two vehicles during the early morning hours and while wearing dark clothing. A witness to the accident stated that he saw a car driving at what he described as an excessive speed and that the car left the scene after the impact. The driver indicated that she circled the block after the accident and did not leave the scene. She also stated that she was not given a citation by the police.

The injured pedestrian made a demand for the plaintiff’s policy limits, but only if the parties entered into a settlement before filing a lawsuit. The motorist’s insurer offered $5,000 to settle the claim, instead of the $100,000 available under the motorist’s policy. The injured pedestrian filed a personal injury lawsuit against the motorist. The driver’s insurer attempted several times to take testimony from the witness but was unsuccessful until reaching him immediately before trial. After the close of evidence, the jury returned a verdict awarding the plaintiff $414,500 in damages and assigning 35 percent of the fault to the plaintiff. The driver’s insurance company paid the policy limit of $100,000.

The pedestrian then filed a lawsuit against the insurance company, stating that the insurance company’s offer of $5,000 was not reasonable. The trial court concluded that the settlement offer was reasonable and found no evidence suggesting that the insurance company engaged in bad faith settlement practices. In reaching this conclusion, the trial court noted that there was no expert witness testimony presented about the insurer’s duty under Massachusetts statutes regarding good faith settlement offers. The appellate court also noted that the insurer was provided with vague facts regarding the series of events and that the witness was difficult to depose throughout the matter. As a result, the appellate court upheld the lower court’s determination that the insurance company did not engage in bad faith.

At the Law Office of Michael O. Smith, we have handled many different types of car accident cases on behalf of injured Massachusetts residents. Whether the accident was relatively minor or resulted in catastrophic injuries, we are committed to providing you with the diligent, personalized, and empathetic legal counsel that you deserve. Our team offers a free consultation to help you learn more about your options, so call us now at 617-263-0060 or contact us online to get started.

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