Washington Injury Lawyer Blog

Subrogation, or in other words, the repayment of medical and wage loss benefits to a health insurance carrier, PIP carrier, Medicare (ugh) or L & I is a subject that could take up an entire edition of The Everett Herald, or for that matter, the Seattle Times. But I'll try to make my point and move on.

Prior to the decision in Tobin v. Department of Labor and Industries, 165 Wn.2d 1016, 199 P.3d 411 (2009), DLI always calculated the amount of reimbursement it is owed by including the entire amount of the settlement/verdict which included general damages. I.e. compensation for pain and suffering. Well, the problem with that was that DLI was getting reimbursed out of compensation received for a benefit that they don't provide. So the Tobin Court reined them back in and said that the Department can only be reimbursed for benefits paid. So the Department could not get reimbursed out of a claimant's recovery for pain and suffering and could not use it in the distribution calculation under RCW 51.24.060(1).

To put it politely, the Tobin decision has ticked off the Department. I guess they think this is something new the court invented. But it's not. In Southwest Fiduciary, Inc. v. AHCCCS, 1 CA-CV 10-0300/10-0301, (2011), the Arizona Court of Appeals, Division 1, came to a similar conclusion. The Arizona Health Care Cost Containment System (AHCCCS) had been claiming a lien upon the entire recovery of the claimant, just like in Tobin. The Arizona Court of Appeal clarified and stated that in the context of a tort settlement, AHCCCS's share should be calculated based upon the amounts it has paid.

From my perspective, the Tobin decision doesn't limit the recovery that DLI gets, but allows a claimant to actually keep compensation for pain and suffering that they deserve. So until DLI starts to compensate claimants for pain and suffering and other general damages, they just need to relax and back down.

Posted by John Williams of Williams Law Offices, PLLC.

Unfortunately, this blog entry was prompted because of a current client's experience with a body shop. When your car is damaged in a crash, you get it repaired at a body shop. Sounds simple, but depending on your body shop and other factors, you could end up having a very unpleasant experience. It doesn't matter if you're in Seattle, Everett or Arlington, when it comes to body shops, there are good ones and bad ones. So it's vitally important to make sure that you choose a reputable shop that does very good work. (On a quick side note, you are under no obligation to use a shop recommended by an insurance company) The best way to locate a reputable shop is through a referral from friends and family. But even then, make sure that you like the shop. Does it look professional or is it a guy working out of his garage?

Next, if an insurance company is paying for the repairs, DO NOT sign the insurance check until your car is completely repaired and you have thoroughly inspected your car to make sure you are satisfied with the work. Only then do you sign the check and give it to the body shop. If a body shop wants you to sign the check prior to starting work, immediately go to another body shop. If you sign the check before the repairs are completed, you are at the mercy of the body shop.

When you are in a car crash and your car is either damaged or totaled, you have an immediate problem. At the very least, you car is drivable but damaged, or damaged beyond repair and a total loss. Assuming you have collision coverage on your car, who pays for the damage to your car? Perhaps a better question is, who do you want to pay for the damage to your car? In most cases, I recommend that you go through your own insurance company and use your own collision coverage and rental coverage. Many people don't consider using their own insurance coverage since the accident wasn't their fault, but there are potential pitfalls when going through the at fault person's insurance company. First, you are at their mercy. If they handle the claim slowly and treat you like a second class citizen, there isn't much you can do. But if you are going through your own insurance company, you are their insured and they owe you significant duties when handling your claim and as such, you will get better service and better treatment. Second, especially in a total loss situation, you will likely obtain a better total loss offer from your own insurance company and they will be more likely to work with you to resolve the claim to your satisfaction. Your own insurance has an obligation to treat you fairly and reasonably, the at fault parties insurance company has no such obligation.

If you have any questions, feel free to contact me at 425-252-8547 or John@williamslawpllc.com

You've done your part and obtained homeowner's insurance coverage or renter's insurance. So if anything ever happens you're taken care of, right? Well, not necessarily, especially when it comes to personal property issues or questions regarding the condition of your house prior to a fire, flood or other event. Especially if your house was completely devastated by a fire.

While you may have coverage for personal property, it can become a monumental task to reconstruct all of your belongings. Maybe you have some documentation in a safe deposit box, or perhaps a retailer has information that you purchased that ring or television, but for the most part you will have to attempt to remember all of your property. At best, you may be able to remember half of what was actually lost. Think of all of the little items that you'll forget. Maybe it's something that was just worth a dollar, but there will be a lot of items worth a dollar, or five dollars that you will not get compensated for.

The solution? It's easy. Videotape your house and everything in your house. I mean everything. Open drawers, open cabinets, open closets, go in the garage, leave nothing out of the video. It doesn't have to be a masterpiece, just enough to help identify items and enough to help you itemize your property. So when you are videotaping, freely talk about what you are looking at, describe it, pick it up if necessary to get a better view. There may be some items that you want to take pictures of as well. If you own guns, they should ideally be in a fireproof safe or other safe location, and in addition to videotaping them, be sure to write down the serial numbers. If you have expensive jewelry, you may want to have it identified and appraised by a jeweler. I would suggest redoing the video every two to three years or when your personal property substantially changes.

All of the information must then be stored off site, at a relative's house, your office etc. Not a lot of use in compiling all of this information and having it burn up in a fire. Also, as a side note, if you have important documents and/or photos on your home computer, get a back up drive and get that information backed up so it can be stored off site. Enduring a tragedy that takes your house is bad enough, don't compound it by lack of preparation.

Ok, I do roll my eyes whenever anyone starts talking about "The McDonald's Case". So far, no one has ever come close to describing the real facts. I hope the following article will help to set the case straight.

There is a lot of hype about the McDonalds' scalding coffee case. No
one is in favor of frivolous cases of outlandish results; however, it is
important to understand some points that were not reported in most of
the stories about the case. McDonalds coffee was not only hot, it was
scalding -- capable of almost instantaneous destruction of skin, flesh
and muscle. Here's the whole story.

Stella Liebeck of Albuquerque, New Mexico, was in the passenger seat of
her grandson's car when she was severely burned by McDonalds' coffee in
February 1992. Liebeck, 79 at the time, ordered coffee that was served
in a Styrofoam cup at the drive-through window of a local McDonalds.

After receiving the order, the grandson pulled his car forward and
stopped momentarily so that Liebeck could add cream and sugar to her
coffee. (Critics of civil justice, who have pounced on this case, often
charge that Liebeck was driving the car or that the vehicle was in
motion when she spilled the coffee; neither is true.) Liebeck placed
the cup between her knees and attempted to remove the plastic lid from
the cup. As she removed the lid, the entire contents of the cup spilled
into her lap.

The sweatpants Liebeck was wearing absorbed the coffee and held it next
to her skin. A vascular surgeon determined that Liebeck suffered full
thickness burns (or third-degree burns) over 6 percent of her body,
including her inner thighs, perineum, buttocks, and genital and groin
areas. She was hospitalized for eight days, during which time she
underwent skin grafting. Liebeck, who also underwent debridement
treatments, sought to settle her claim for $20,000, but McDonalds
refused.

Here's an interesting AP story which I think really shows what motivates Allstate Insurance:

NEW YORK (AP) — Allstate Corp. CEO Thomas J. Wilson received total compensation valued at $10.4 million in 2009, up about 30% from a year earlier, according to a regulatory filing.

The pay raise for Thomas Wilson came as the property and casualty insurer stanched steep investment losses to help post a profit for the full year. Wilson had earned $7 million in the previous year, according to an Associated Press analysis of a filing with the Securities and Exchange Commission.

In 2009, Wilson earned a base salary of $1.1 million, which was an increase of 6 percent. His performance-based compensation was $1.7 million, more than double the $736,261 he got in 2008.

Wilson also got stock and options worth $6.5 million when they were granted, compared with $5.2 million in 2008.

His other perks and compensation totaled $68,072 and consisted of $23,154 for personal use of a company plane and $9,800 in matching contributions to a retirement plan. The remaining $35,118 was for miscellaneous items including life insurance premiums, cell phones, tax preparation, financial planning, security, ground transportation and supplemental long-term disability coverage.

For 2009, Allstate said better risk management in its investment portfolio helped it earn $854 million, or $1.58 per share, compared with a net loss of $1.68 billion, or $3.06 per share, in 2008.

In the final quarter of 2009 alone, Allstate posted a profit of $518 million, or 96 cents per share, a great improvement over its a loss of $1.13 billion, or $2.10 per share, in the period a year earlier.

Allstate's operating income, which excludes investment gains and losses, rose 14 percent to $592 million, or $1.09 per share, versus a profit of $518 million, or 96 cents per share, a year ago.

So you have comprehensive coverage that provides coverage in the event your car is stolen. Your car is stolen by some juveniles that went on a long joyride until caught by police. During the course of the theft and their joyride, the engine blows and the car is now a total loss. Your insurance company simply pays you for the value of your car, right? Well, no.

Allstate Insurance insured my client for comprehensive coverage, but claimed that the real cause of the engine blowing was her failure to maintain the car. Allstate actually hired an expert to inspect the engine and miraculously come to the same determination. My client’s car did have an oil leak, but she had regular maintenance performed and ensured that the oil level was always correct. After all, the engine never blew when she was driving. In fact, she had her car serviced and the oil changed one month prior to the theft.

The Good Hands people would not budge from their completely unreasonable position, so we were forced to file a lawsuit. Copeland v. Allstate Insurance Co. The lawsuit contained numerous causes of action including bad faith and violations of the Washington Insurance Fair Claims Act. Shortly after filing the lawsuit, Allstate settled my client’s case for roughly 4 times what her actual damages. It is truly unfortunate that lawyers are necessary in order to have an insurance company provide the coverage that their insured has paid premiums for. So much for being in good hands.

Insurance agents have the remarkable ability to know very little about the product they are selling, or at the very least seem to do a poor job of explaining coverages to their customers. Yes, I know that there are good agents out there, I have one of them at PEMCO in Seattle, but unfortunately that isn't always the case. One of the biggest misconceptions is that if you are in an accident that isn't your fault, the other persons insurance company will pay for your medical expenses. Well, this is half true. When the other persons insurance company settles the claim with either you or your attorney, the settlement will include your medical expenses. But that doesn't help you if you do not have the ability to pay for necessary medical care now. So what's the answer? PIP

Personal Injury Protection (PIP) is a coverage available in Washington that insurance companies must offer you, and if you reject it, you must do so in writing. PIP is basically health insurance if you are injured in an auto accident. It will pay for your medical bills which are "reasonable, necessary and related" to injuries sustained in a car accident. PIP will also, to a limited extent, pay for lost wages and also household services.

PIP is considered a no-fault coverage which means it is available to you regardless of fault. PIP will pay for your medical bills whether or not you are at fault for an accident. Many clients have expressed to me how it seems wrong that their own insurance company should have to pay for medical treatment caused by injuries from an accident that wasn't their fault. Don't worry, your insurance company will get repaid (subrogation).

If you do not have PIP, please have it added to your policy immediately. It costs very little and is vital, especially if you do not have any health insurance. Even if you have health insurance, consider PIP since it will cover many types of care that may have limited coverage under your health insurance policy, such as chiropractic, massage and acupuncture treatment. PIP is generally available with limits of $10,000.00 or $35,000.00.

If you have any questions regarding PIP coverage or insurance coverage in general, please feel free to contact me.

When you're in a car accident and you are injured by the negligence of another driver, they (or in most cases, their insurance company) will pay for all of your damages including medical bills, right? While that's technically true, this answer fails to address the complete picture.

The at-fault driver's insurance company will pay for your medical expenses, lost income, other out of pocket expenses and general damages (commonly called pain & suffering), but only as a lump sum when your case is settled or a verdict rendered. They do not act as your health insurer and pay for your medical care as you incur those costs for treatment. This is where PIP comes in. When you open a PIP claim under your own auto insurance policy, this coverage pays for your medical expenses as you incur them. Essentially, your auto insurance company acts as a health insurer for injuries related to the car accident. Your insurance company then has a right to get repaid out of your settlement with the at-fault driver.

At the conclusion of your case, we will determine the amount that your insurance company is legally entitled to receive. In most cases, this amount is less than the total amount your insurance company has paid for your medical care. We will do everything we can to ensure that you are fully compensated for all of your losses and damage resulting from the car accident.

So let's say you're driving into Seattle and unfortunately someone behind you is paying more attention to their Blackberry than driving, and rearends you. You're injured and need medical care, but at least you have Personal Injury Protection (PIP) which will take care of your medical bills. Did you know that in some circumstances you have to reimburse your insurance company for any payments made under PIP coverage? That's right, you pay them a premium, they provide PIP coverage, and then you pay it back.

Ok, it sounds a little counter-intuitive, but it really does make sense. Lets take a couple different senarios. Number 1 - You are injured in a car accident, you use your PIP coverage to pay for your medical care and you do not pursue a claim against the other driver. Maybe you don't want to. or perhaps the accident was your fault. In this senario, you do not have to reimburse your insurance company because you did not receive a settlement from another party. To put it another way, your insurance company does not have a right of subrogation (right of reimbursement) in this case. Lets look at senario Number 2 - You are in a car accident, it's not your fault, you are injured and use your PIP for your medical care. You then settle your claim against the at fault driver. Your insurance company will have a right of subrogation.

We all know that Seattle is a dangerous place to drive a car, or especially be a pedestrian. While Washington's new cell phone law is a start, a very SMALL and almost useless start in my opinion, there are still many distracted driver's out there that don't see other cars, trucks or pedestrians. And if you drive a motorcycle, you probably feel that there is some cloaking shield around you that makes you and your motorcycle invisible! If driver's can't "see" a SUV, they certainly won't see you on your bike.

Ok, so now your motorcycle is a total loss and you have severe injuries and can't work. So how do you pay for your medical bills? If you are in your car, you simply use your personal injury protection (which everyone should have) to pay for your medical bills. But unfortunately, you discover that you do not have PIP coverage on your motorcycle, since no insurance company offers that coverage for motorcycles. While I haven't researched the reason for this, I would guess that the number of severe injuries is significantly higher than for cars and trucks. In addition, while Washington state law requires that PIP coverage be offered on car and truck policies, it is not mandated for motorcycle policies. The backup to PIP coverage is your own health insurance, but if you are among the many uninsured in the state, you could be in real trouble.

Many people are under the impression that the at-fault driver's insurance will take care of your medical bills. While this is technically true, they will not pay for your medical bills as you incur them like PIP or health insurance. Through settlement or a verdict, your medical bills will be reimbursed, but that could be 1, 2 or 3 years down the road. If you ride a motorcycle and do not have private health insurance, I would encourage you to take another look at your transportation options.

I usually receive a blank stare when I ask if someone has PIP coverage, but it's a very important and fairly inexpensive coverage on your automobile policy. PIP coverage has to be offered to you when you obtain an automobile insurance policy and has to be rejected in writing if you do not want the coverage. PIP is generally available with limits of $10,000.00 or $35,000.00.

PIP will pay for accident related medical expenses, wage loss (up to a maximum amount per week set by the policy), and necessary household expenses such as house cleaning and yard services. PIP is no fault coverage, which means it is available to you regardless of your fault for the accident. PIP is especially important if you do not have health insurance, otherwise, obtaining medical care in the event of an auto accident is very difficult.

Perhaps the biggest misconception regarding PIP coverage is that is really isn't needed if you aren't at fault for an accident, since the other insurance company will pay for your medical expenses. While this is technically true, they have no obligation to pay as you incur your treatment which is critical. Their only obligation is to pay for your damages either through settlement or verdict, after you have incurred your medical expenses.

If you do not have PIP coverage or simply don't know if you do or not, contact your insurance agent and have it added. It's costs very little so you get a lot of bang for your buck if you ever need it.