After Woman Dies In Car Crash, Brother Says Her Insurance Company Defended Other Driver In Court

UPDATE #2: Progressive has denied its attorneys acted as legal counsel for the other driver in the lawsuit.
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UPDATE: Some more information has come to light, along with one expert’s explanation for why Progressive might have done what the victim’s brother says it did.
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The Twitter-sphere (and the Consumerist tipline) are blowing up this afternoon with the story of a man who claims that after his sister’s life was taken in a tragic car crash, her insurance company — Progressive — came to the aid of the man driving the other car.

As he details on his Tumblr page, in June 2010, Matt’s sister was killed in Baltimore when another car allegedly ran a red light and crashed into her vehicle as she crossed through the intersection.

According to Matt, the other driver’s insurance company settled with his sister’s estate “basically immediately,” but because that driver didn’t have much insurance, there wasn’t much to be gotten from his insurance company. However, Matt’s sister had a Progressive policy that he says was intended to protect her in the case of the other driver being under-insured.

But Matt claims that Progressive refused to pay out that policy. Left without other legal avenues to pursue, he says that his family sued the other driver in order to establish his negligence, which they could then use as leverage to compel Progressive to pay they believed was owed.

“Now my parents don’t harbor much venom for the guy who killed my sister,” he writes. “But kicking that guy around was the only way to get Progressive to pay.”

But, claims Matt, when the case came to trial, the other driver was defended by Progressive’s lawyers.

In the end, it didn’t matter, as the jury found the other driver responsible, which means the policy — at least according to Matt’s story — should pay out.

We’ve reached out to both Progressive and Matt to see if anyone will provide any further details on this story. If we hear anything from either party, we’ll be sure to update.

UPDATE: When reached for comment, a rep for Progressive issued the following statement to Consumerist:

“This is a tragic case, and our sympathies go out to Mr. Fisher and his family for the pain they’ve had to endure. We fully investigated this claim and relevant background/evidence, and feel we properly handled the claim within our contractual obligations. Again, this is a tragic situation, and we’re sorry for everything Mr. Fisher and his family have gone through.”

Comments

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  1. consumerd says:

    I guess under all that “flo-talk” there is a dark side after all. She always did strike me as “creepy” Now I know why!

  2. pecan 3.14159265 says:

    Um, does anyone have that policy? Are you in Maryland? Can you tell the posters what it says so we have something to talk about?

    • snarfies says:

      I don’t have an Allstate policy, but I can tell you that the minimum mandatory UM/UIM coverage in Maryland was 20k/40k (more recently raised to 30k/60k). The first number is the maximum payoff to one party, and second number is the maximum payoff for all parties.

  3. lancedriftwood says:

    The sister’s estate lawyer needs to sue Progressive for policy limits under the uninsured/underinsured motorists coverage. If Progressive does not pay – they are wide open for a
    ‘bad faith’ claim with no policy limitations.

    • katstermonster says:

      The original article states that Maryland law does not allow you to sue the insurance company.

  4. Guppy06 says:

    Stay classy.

  5. colpuck says:

    As a former PI attorney I can vouch that is standard practice. The other drivers insurance paid out to its policy limit, which is what it was obligated to do. At that point the plaintiff goes their insurance seeking reimbursement under their uninsured/underinsured policy. If the Plaintiff’s insurance thinks the amount demanded is out of line they will not pay it. Then story plays out exactly as the OP described it.

    The defendant’s insurance has no incentive to fund the defense because they are not on the hook anymore. It falls to the plaintiff’s insurance to fund the defense if they do not want to pay.

    • rawrali says:

      Agreed. Once the other party’s insurance has paid its limits, it no longer has any duty to defend its insured. That is why Progressive stepped in.

      The OP seems to believe that Progressive had the duty to immediately pay out its entire UM/UIM limits when his sister died. That is not the case – there are a lot of factors that go into these payments – age, education, job, etc. Depending on the state, there are limits to what a deceased’s survivors can recover. Parents are oftentimes limited in what they can recover if the deceased was an adult. Children usually collect the most in these cases. The way a person died can also impact what a company is willing to pay out – i.e. being killed instantly will likely result in less money than prolonged suffering. Based on what the OP said, Progressive didn’t refuse to pay out their money, they just refused to pay out their limits.

      This process is understandably confusing and frustrating to the grieving parties, but it is the way the system works.

  6. Milquetoast says:

    If you switched insurance carriers every time you found out your current one did something unethical, you wouldn’t have insurance. I don’t know for a fact that this is a common occurrence, but it’s not the first time I’ve heard of something like this, and I would not be surprised if it’s a somewhat standard practice. It’s most likely much cheaper for Progressive to offer free legal services to the “other” driver than to pay out the policy.

  7. mbd says:

    Duh? That is what insurance companies do. If the driver was insured by Progressive, they will either settle if they can or defend him in court. It does matter if the deceased party was also insured by the same insurance company. I’m shocked, yes shocked to find out that an insurance company would want to pay out as little as possible. The family of the deceased did exactly what they should have done, and sued the driver so that a court could settle the amount due them.

    • katstermonster says:

      The way I read this is that the other driver DIDN’T have Progressive – they had some other insurance. The case file (the link to which I’ve sent to the tips address, as it “outs” the defendant, which feels a little icky to me) indicates this as well. Progressive had to file a motion to be considered as a defendant.

    • ecuador says:

      Your reading comprehension skills are lacking.
      The driver did not have Progressive. His own insurance settled immediately.

  8. TrustAvidity says:

    It’d probably go down nationwide if they made it illegal. Doesn’t make it a good idea.

  9. longfeltwant says:

    I have a proposal.

    In some industries we separate business functions in order to remove conflicts of interest. I would like to divide the insurance industry between companies which offer insurance policies, and companies which decide whether events are covered by policies.

    This would be similar to dividing the legislative and judicial branches of government, or similar to dividing investment banks from ratings agencies.

    • Bsamm09 says:

      Basically you want every claim made on an insurance policy to go to a court/arbitrator/mediator?

      I think that’s what happened in this case.

      • Loias supports harsher punishments against corporations says:

        It went through a jury. Says so in the article.

        • Bsamm09 says:

          I know. You want that for every insurance claim you make from now on? I don’t.

          • Chuft-Captain says:

            No, what he wants is for the insurance compant to have to submit the claim to another agency. The sole job of that agency is to look at the claim, look at the policy contract, and say “According to the policy this is covered” or “According to the policy, this is not covered”, then hand it back to the insurer to process accordingly. Thus removing the financial pressure for the insurance company to deny claims itself by having a third party make the call who does not stand to gain extra either way.

    • Loias supports harsher punishments against corporations says:

      We disagree much of the time, but I find this very reasonable, even logical. Beyond some extra steps and bureaucracy, this would work out swimmingly for consumers. Probably not for insurance.

      • unpolloloco says:

        Insurance companies typically target a payout ratio somewhere around 1 (sometimes above 1). That is, their payouts are roughly equivalent to what they collect in rates. They make their money off of the markets in the intervening time between when they collect and pay out. Therefore, every dollar of additional cost gets sent straight to policy rate increases. Is that really good for the consumer?

        • Loias supports harsher punishments against corporations says:

          What’s good for the customer is to get what they pay for, period.

          You are right, that proposed method would most likely increase overall rates (there’s an arguement for lost of payouts versus elimination of legal fees to fight claims). But for a consumer, the most important thing is to get what is promised. The price is a secondary consideration.

    • Jane_Gage says:

      Also insurance companies should get their own auto body shops with some sort of third party auditor. I see too many cars getting totaled just because the rates to fix them are so outrageous.

  10. enomosiki says:

    Insurance companies are scummy at best.

    Several years ago, I was involved in a vehicular accident, with the fault being the other driver. Specifically, I was in the process of making a left turn at an all-way stop intersection, when the car at the other side plowed through his stop sign and nearly T-boned me with enough force that my SUV did a 180 degree spin. And it wasn’t like the other car was another SUV or anything; it was a compact, so it would have had to been traveling at a somewhat substantial speed to have my car, something that weighs twice as much as his, to spin like that.

    My insurance company, Allstate, did nothing regarding the incident. And, when I said nothing, I mean abso-fucking-lutely IDGARA nothing. It made me question what the hell was the point of being insured. Oh, wait, because in my state, every vehicle HAS to be insured, so the insurance companies couldn’t care any less as long as they collect the fees. Oh, boy!

    Because Allstate wasn’t willing to do anything, I had to contact the other driver’s insurance company, Countrywide, and personally work everything out. It was frustrating that it took them THREE MONTHS to send out an someone to assess the damage, which came out to be a total loss for my car. And, the worst part is that they only offered 30% of the KBB value, despite the fact that everything was in my favor. And that was AFTER I threatened them with a letter to the AG and small claims court.

    NEVER assume that your insurance company has your back. They don’t. All they care about is siphoning your money and, when it’s the time to get them involved, they will do everything in their power to screw you over.

    • snarfies says:

      Former auto insurance adjuster. Based soley on what you told us, OF COURSE they did nothing, because you have a basic misunderstanding of what your insurance is FOR – Its to pay for property and/or medical damage that you cause to OTHERS. Its good to notify your insurance company of your accident, but unless you were invoking your collision coverage (which you didn’t state you had), then yes, if you want your damages pay for, you persue the OTHER party.

      • Lyn Torden says:

        “no fault” insurance was supposed to fix this scam.

        • NeverLetMeDown2 says:

          How is this a scam? The insurance company isn’t going to pay out for something they’re not responsible for…

      • IGetsAnOpinion says:

        I was under the impression that you are supposed to contact your Insurance Co and they are supposed to fix your car (pay your claim), then they go after the person at fault’s insurance to collect what they paid out.

        Although I do remember one time, we did have to call the other person’s insurance company and deal with them directly – but it was only minor damage that needed to be fixed.

      • Geekybiker says:

        Sure if you only have liability. Insurance companies are much more responsive if you have comprehensive as they have money on the line if they can’t make the other company pay.

    • Kaniac says:

      I totaled my own car, and it was my fault. (Winter, night and freezing rain: when I told the officer I was going well under the posted speed limit, he said that if I hadn’t been going “too fast for conditions” I wouldn’t be in the ditch with my car upside down. He had a point…)

      Anyway, my insurance – State Farm – completely covered a new car (one with a lower center of gravity!) I expected that much given the policy I had/have. What I didn’t expect was that my rates didn’t even go up because I hadn’t had an accident in the 10 years I’d been driving. I was pretty shaken up after the accident, but that (and, of course, the fact that no one got seriously hurt) made me feel a bit better about the whole thing.

      So, not all companies are terrible and/or shady. Now I just have to make it another 6 years without another crash…

    • SirWired says:

      Did you have collision coverage on the car? If so, all you have to do is file a claim with your own insurance company if the other driver’s coverage won’t play ball. (The idea is that your insurance pays, and then they subrogate the claim to the other company and recovery your deductible when that’s complete.) I’m not quite following when you said that your own insurance company “didn’t do anything.” Did you file a collision claim, and they simply ignored it? This is downright baffling… Allstate isn’t exactly a low-rent outfit; should have taken them about 24-48 hours to deploy an adjuster.

      Now, if you only had liability coverage on your car, then I would not expect your insurance company to do anything whatsoever, as you didn’t pay them to.

      And if an insurance company won’t play ball with a claim, the AG’s office is not where you go; you file a complaint with the state insurance commission. (And “threatening” legal action is a bad idea; just file. “Threats” mean your claim goes directly to the legal department; Do not pass Go, Do not pay out $200.)

  11. katstermonster says:

    Just as a heads up to other commenters – I was able to find the case in Maryland’s judicial records, and it indicates exactly what the OP claims: Progressive filed a motion to be considered as another defendant. I have emailed the link to the tips line, since posting it here and “outing” the defendant on the interwebs seems a little icky to me. Yeah, it’s public records and all that, but he’s paid his debt, it seems wrong to preserve a link to the case here for all of eternity.

  12. crispyduck13 says:

    That’s horrible and I feel terrible for the family to have to go through such sudden loss like that.

    This is why you need to have life insurance people. Take what you think you need and add 50%.

    • NeverLetMeDown2 says:

      How on earth does this follow? If the OP’s sister was, single and without kids, then anything she was paying for life insurance (beyond perhaps enough for burial expenses) was a waste.

      Having life insurance only makes sense if there are others dependent on your income (or for tax/inheritance planning purposes).

      • unpolloloco says:

        Or in this case, when you have people responsible for your student loans if you die

        • NeverLetMeDown2 says:

          Good point – didn’t see any mention of that in the story. Certainly, if you have liabilities to settle, that’s good reason as well.

  13. SirWired says:

    I imagine that’s how an un/under-insured motorist policy would work. I don’t see a story here, other than an interesting lesson about how Un/Under-insured motorist coverage pits your own insurance company against you. I imagine this would be a largely inevitable consequence of the very nature of the policy if you don’t accept whatever settlement the insurance company is offering (if any.)

    • katstermonster says:

      I’m pretty sure that’s the entire point of the article – most people don’t realize that your insurance company will defend the other party if they don’t feel like paying out the rest of the claim. I had no idea, personally.

  14. tlvx says:

    This behavior should be wholly illegal. Changing sides with the wind- for the sole purpose of reducing claim exposure- is a clear violation of their fiduciary responsibility to their insured party.

    That’s like a derivatives broker taking bets on a companies success, while they put everything on the company failing… even securing an insurance policy so they cannot lose… Oh, wait!

    • NeverLetMeDown2 says:

      “This behavior should be wholly illegal. Changing sides with the wind- for the sole purpose of reducing claim exposure- is a clear violation of their fiduciary responsibility to their insured party.”

      No. If they’re the one that’s going to have to pay out, but believe that the facts of the case dictate that they shouldn’t, they’re perfectly justified in arguing that.

  15. JJFIII says:

    The OP lost me with this one ” my parents don’t harbor much venom for the guy who killed my sister,” he writes. “But kicking that guy around was the only way to get Progressive to pay.”

    So the guy who KILLED your sister is ok, but you are mad at a company that wont give you MONEY. You have basically just made your sisters life all about the money instead of about the guy who killed her.

    The way life is, your sisters life is assessed a value. To you it may be $100 trillion. That is not the way the courts value life. They will take into account the number of working years left, the salary she would make, the loss of companionship etc. The driver at faults insurance company gave the max that their insured could get. Basically you are valuing your sister at one thing, while the insurance company has another valuation. THAT is exactly what the courts are for in this situation.

  16. Jawaka says:

    I’m curious what the family was suing for? Matt’s sister unfortunately died in the accident so it wasn’t to cover medical bills. The story said that the other driver had insurance which settled so they already received some money. Is this all just about greed?

  17. robertkillen says:

    They defended the other party so they wouldn’t have to pay out under UIM. If the victim was even partially liable, they wouldn’t have to pay out.

  18. picabo says:

    UPDATE #2: Despite a denial of assisting the individual responsible for the death, a simple search for court documentation shows that Progressive was given permission to participate on the side of the defense back in May 2011. The document reads:

    It is this 19th day of May, 2011, by the Circuit Court For Baltimore City, hereby ORDERED

    1. That Progressive Advance Insurance Company be and is hereby allowed to intervene as a party Defendant.

    2. That Progressive Insurance Company is GRANTED all rights to participate in this proceeding as if it were an original party to this case.