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The Complex Relationship Between Defendants And Insurance Companies


When you sue a Defendant, you may be a little confused, because often we talk about the Defendant in an injury case, and then other times, we talk about the insurance company. You may even hear your own injury attorney speak about the Defendant, but also about the insurance company. But which is it—are you suing an actual company or person, or are you suing an insurance company?

It may help to understand how an insurance company works, when it comes to defending people or companies who are sued.

What Insurance Companies Do in a Lawsuit

Most insurance companies not only pay for any damages that the Defendant owes or settles for, but they also have a duty to defend their insured. Practically, that means that they appoint, hire, and pay for an attorney to Defend the Defendant in court.

Some insurance companies, like many car insurance companies, have now turned to having their own in-house law firms that the insurance company owns and operates. That means that they don’t have to pay the hourly rates that many defense attorneys charge; rather, they pay their attorneys a yearly salary, the attorneys only handle the insurance company’s cases, and their attorneys can handle as many cases as the insurance company may need to handle.

Who Makes the Decisions?

The insurance company also largely calls the shots in the defense of the case. It is the insurance company that will decide whether to send a victim to an IME, or whether it is worth the money to hire a defense expert. It is the insurance company that will determine whether to settle the case, if the case settles for within the policy limits.

The insurance adjuster will even be present at most court proceedings, like hearings, mediations, or depositions, along with the actual Defendant.

This creates a unique situation: On the one hand, the person or company being sued, is the client of the Defense attorney. On the other hand, it is the insurance company that is paying any settlement or verdict, and the insurance company that is paying the attorney.

Ethically, the defense attorney represents the Defendant, regardless of who pays the attorney, and regardless who will ultimately pay any verdict.

In court, the jury is not allowed to know or to be told that there is an insurance company involved. That’s why you will never hear the insurance company referred to by name in any trial, or on any official court filed documents.

Self-Insured Defendants

Note that some defendants don’t have insurance, because they self-insure. For larger companies that have millions of dollars at their disposal, they will have insurance departments, or separate companies that they own, which will act the way that insurance would.

Contact Barbas, Nunez, Sanders, Butler & Hovsepian if you are in any kind of accident and have questions about who may be responsible for your injuries. Schedule a consultation with our Tampa personal injury lawyers today.


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