In cases of serious catastrophic injury, we often see auto insurance coverage limits impose a barrier in the amount we are able to collect and recover. In all cases involving serious or permanent injury, the victim or his or her attorney should perform careful asset searches based on public record. One Canadian asset search vendor will actually provide current bank account balances along with a detailed summary of all corporate affiliations, real estate owned, registered owned vehicles, and all other indicia of owned assets and wealth. Also, www.lexis.com has powerful asset search tools that help to locate property and identify wealth and assets.
If the injury claim value exceeds the amount of available coverage, a trial verdict would be necessary to levy against bank accounts and personal property and to perfect a judgment lien against owned real estate. Thus, you cannot collect from the at-fault driver’s assets unless you complete a trial. This means you cannot accept the liability policy limits unless you either first prevail at trial or unless you forfeit your right to a trial and give up any claims that exceed the available insurance coverage limits.
In catastrophic injury matters, asset searches should be performed soon after the collision occurs. Unfortunately, we often see responsible drivers facing significant legal liability transferring assets after an accident to divest themselves and avoid judgment. North Carolina law prohibits “fraudulent conveyance” intended solely to avoid creditor claims. Early asset searches paired with subsequent asset searches clearly show wealth transfers made solely to avoid victim claims. These transfers can be halted and reversed by the court.
A large verdict and judgment will occasionally render a responsible driver insolvent. In these cases, he or she may file bankruptcy to avoid payment of the victim’s claims. Victim claims arising from a collision caused by a drunk driver are not subject to discharge in bankruptcy. Also, in many Chapter 7 and Chapter 13 filings, the victim can collect some fraction of their judgment from the insolvent debtor’s bankruptcy estate.
In the next chapter, we discuss how to choose an insurance company and how to read and understand your car insurance policy. Thereafter, we thoroughly explore how to protect your legal rights after an accident, how to safely report all insurance claims, and how to collect maximum payment for all property damage and injury claims. We review the terms of a proper settlement and consider the steps involved in litigation and trial if the insurance carriers refuse to offer an acceptable settlement for all accident claims.