Debunking Myths About Filing Car Accident Lawsuits in Utah
Car accidents can result in serious injuries and financial loss. Unfortunately, many misconceptions prevent injured individuals from pursuing fair compensation. As a Utah car accident attorney with 20 years of experience, I’m here to clarify these myths and explain why filing a claim or lawsuit is often necessary and justified.
Myth 1: Filing a Lawsuit Will Bankrupt the At-Fault Driver
Many people believe that suing someone for a car accident will financially ruin them. They imagine the at-fault driver losing their home, business, or being forced into bankruptcy. This is rarely true.
The Role of Insurance Companies
When you file a claim or lawsuit, the at-fault driver’s insurance company typically pays the damages. Insurance policies are designed to protect individuals from financial ruin by covering their liability.
Who Decides to File a Lawsuit?
Only you, the injured party, can decide whether to file a lawsuit—not your attorney. You also have the final say on whether to pursue an excess judgment above the insurance policy limits.
Bankruptcy Fears Are Unfounded
In my 20+ years of handling car accident cases, I have never seen a case where filing a lawsuit forced someone into bankruptcy. Excess money judgments are rare and often uncollectable.
The Utah Exemptions Act
Utah law protects individuals’ personal assets under the Utah Exemptions Act (Utah Code 78B-5-503). For example:
- Up to $84,000 of equity in a primary residence is protected.
This means even if a judgment exceeds someone’s insurance limits, many of their assets remain protected.
Myth 2: Excess Jury Verdicts Are Common
Another misconception is that large jury verdicts exceeding insurance policy limits happen all the time. In reality, excess judgments are rare.
The Role of Insurance Policy Limits
Insurance companies typically pay up to the at-fault driver’s liability policy limits. If the damages exceed these limits, the injured party must decide whether to accept the settlement or pursue the individual’s assets.
What Happens in an Excess Verdict?
Excess verdicts often occur when the insurance company fails to tender the policy limits in a reasonable timeframe. This exposes their insured to risk.
Are Excess Judgments Collectable?
Excess judgments can be futile and uncollectable, especially when the at-fault party:
- Has no significant assets (e.g., poor college students).
- Can discharge the judgment through bankruptcy.
Examples of Rare Excess Judgment Cases
Example 1: The College Student
- Situation: A BYU student with a $25,000 policy causes $50,000 in medical damages.
- Reality: The injured party accepts the $25,000 settlement. The student has no assets to pursue, and no judgment forces bankruptcy.
Example 2: The Business Owner
- A Provo businessman with a $1 million commercial policy causes a tragic accident.
- Solution: The insurance company tenders the $1 million policy to avoid an excess judgment.
Example 3: The Wealthy Businessperson
- A businessperson with a $31 million net worth only carries $25,000 in liability insurance.
- Outcome: The injured party can pursue the individual’s personal assets because of their negligence in being underinsured.
Example 4: The Underinsured Doctor
- A surgeon with $2 million in assets and a $500,000 policy causes a fatal accident.
- Outcome: The injured party may accept the $500,000 or pursue additional compensation.
Myth 3: Filing a Lawsuit Makes You Greedy
Filing a lawsuit is often necessary to receive fair compensation, especially when insurance companies make low initial offers.
Low Insurance Offers Force Litigation
Insurance companies frequently offer less than what is fair. When this happens, filing a lawsuit may be the only way to recover damages for:
- Medical bills
- Lost wages
- Pain and suffering
Seeking Fair Compensation Is Justified
Filing a lawsuit does not make you greedy. It ensures you are fairly compensated for injuries caused by someone else’s negligence.
How Insurance Works in Utah Car Accident Claims
Minimum Liability Limits in Utah
Utah law requires drivers to carry a minimum of $25,000 in liability insurance. Unfortunately, this amount is often insufficient for severe accidents.
Why Being Underinsured Creates Risks
Individuals with significant assets who choose to carry only minimum insurance limits expose themselves to financial risk.
Why Hire a Utah Car Accident Attorney Like Jake Gunter?
With 20 years of experience, I’ve seen every scenario. I know how to deal with insurance companies, protect your rights, and secure fair compensation.
How an Attorney Ensures Fair Compensation
- Negotiating with insurance companies
- Filing lawsuits when necessary
- Pursuing all available damages
Call/Text Jake Gunter for a Free Consultation
If you’ve been injured in a car accident, don’t let these myths hold you back. Call or text Jake Gunter at (801) 373-6345 for a FREE consultation. Let my experience work for you.
