Litigation 101: Arkansas Insurance Law

What is uninsured/underinsured motorist coverage?

These kinds of insurance coverage were developed to help injured drivers and passengers take care of medical bills and other damages where another party was at fault but where that party’s insurance coverage was lacking, either in part or in full.

Uninsured and underinsured insurance coverage are similar – in that they both are designed to compensate an individual who is injured by another person’s vehicular negligence.

Studies show that roughly 14% of drivers in the U.S. are uninsured. As a result, uninsured coverage is somewhat more common than underinsured coverage.

Sometimes referred to as “UIM” coverage, Arkansas allows for the recovery of a 12% penalty plus attorney fees in the event an insurance company wrongfully refuses to pay the appropriate UIM coverage to a policy owner.

I received an offer from the insurance company that seems too low to me. How did the insurance company come up with this figure?

This is a question we seek to have answered in UIM litigation. There must be some rational justification for the settlement amount, which must be fair and appropriate to the situation.

My medical bills were paid by my insurance. Do I still have a case against the person responsible?

Yes. Even though you may have insurance coverage which initially pays for the medical expense, you are entitled to recovery from the negligent party. When your own insurance coverage pays, it is generally known as a “collateral source” of payment, and the negligent party does not get “credit” for payments made by a “collateral source”. In fact, in most situations, the “collateral source” may attempt to assert a claim for reimbursement or “subrogation” to the recovery against the negligent party, but Arkansas law recognizes that the right of subrogation generally does not arise unless and until the injured party is “made whole”.


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