Understanding Legal Malpractice: The Importance of UIM Carrier Consent in Settlements

In the realm of personal injury law, the process of settling a case involves several critical steps that must be carefully navigated to ensure the best outcome for the client. One such step, particularly in Maryland, involves obtaining the consent of an underinsured motorist (UIM) carrier before settling the case with the negligent driver. Failure to do so can lead to significant legal and financial consequences, not only for the client but also for the attorney handling the case. This oversight may constitute legal malpractice.
The Role of UIM Coverage in Maryland
Underinsured motorist coverage is designed to protect individuals involved in an accident with a driver whose insurance coverage is insufficient to cover the damages incurred. In Maryland, if a client’s case exceeds the negligent driver’s insurance policy and the client has applicable UIM coverage, then before a settlement with the negligent driver can be finalized, the attorney should obtain consent from the client’s UIM carrier. This requirement is rooted in the principle that the UIM carrier has a vested interest in the settlement process, as it may affect the carrier’s liability under the policy. Since UIM claims are often contractual in nature and may differ depending on the applicable law, this post is solely focused on Maryland law.
Consent of the UIM Carrier
In Maryland, the specific legal requirements for obtaining underinsured motorist (UIM) carrier consent before settling with a negligent driver are outlined in the Maryland Insurance Article, Section 19-511. This statute mandates a structured process to ensure that the UIM carrier’s rights are protected when an insured individual is negotiating a settlement with a negligent driver’s insurance company. Here are the key requirements as per Section 19-511:
- Notification to UIM Carrier: If an injured person receives a written offer from a motor vehicle insurance liability insurer or that insurer’s authorized agent to settle a claim for bodily injury or death, and the amount of the settlement offer, in combination with any other settlements arising out of the same occurrence, would exhaust the bodily injury or death limits of the applicable liability insurance policies, bonds, and securities, the injured person is required to send by certified mail, to any insurer that provides uninsured motorist coverage for the bodily injury or death, a copy of the liability insurer’s written settlement offer.
- Written Consent: Within 60 days after receipt of the required notice, the UIM carrier must consent to acceptance of the settlement offer and to the execution of releases; or provide written refusal to consent to acceptance of the settlement offer.
- UIM Carrier’s Obligation to Pay: Within 30 days after a refusal to consent to acceptance of a settlement offer, the UIM insurer shall pay to the injured person the amount of the settlement offer.
- Failure to Obtain Consent: If the insured settles with the at-fault driver’s insurance company without first obtaining the required written consent from the UIM carrier, the insured may forfeit their right to claim underinsured motorist benefits under their policy.
It’s important for both the insured and legal professionals to adhere to these requirements to ensure that the insured’s rights to UIM benefits are not compromised. Compliance with Section 19-511 is essential for protecting the interests of all parties involved and for facilitating the fair resolution of claims involving underinsured motorists.
Legal Malpractice and UIM Carrier Consent
Legal malpractice occurs when an attorney deviates from the accepted standard of care and such deviation causes harm to the client. In the context of UIM carrier consent, legal malpractice can arise if an attorney settles with the negligent driver without obtaining the necessary consent from the UIM carrier. Such an oversight can jeopardize the client’s ability to claim underinsured motorist benefits, potentially leaving the client with uncompensated damages.
Consequences for the Lawyer and Client
For the lawyer, failing to obtain UIM carrier consent can lead to a legal malpractice claim. The client may seek compensation for the losses suffered due to the attorney’s negligence, including any additional damages that could have been covered under the UIM policy. For the client, the failure to secure UIM carrier consent can result in a significant financial shortfall, impacting their ability to fully recover from the accident.
Steps to Take if You Suspect Legal Malpractice
If you believe your attorney failed to obtain UIM carrier consent before settling your case, it is crucial to seek legal advice promptly. A legal malpractice claim may be necessary to address the professional negligence and recover any losses incurred. Consulting with a legal malpractice attorney can provide you with the guidance needed to navigate this complex area of law.
Contact Us for a Consultation
If you have concerns about how your personal injury case was handled, particularly regarding the consent of an underinsured motorist carrier, Henderson Law invites you to contact our law firm for a consultation. Our team is experienced in handling legal malpractice cases and is committed to advocating for the rights of clients affected by professional negligence.
For more information or to schedule a consultation, please contact us at (410) 721-1979.
This posting is intended to provide general information about the issue of legal malpractice related to UIM carrier consent in Maryland and is not legal advice. Each case is unique, and we recommend consulting with a qualified attorney to discuss the specifics of your situation.
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