Pittsburgh Lawyers For Dog Bite Insurance Liability Issues
Each Pittsburgh lawyer at our firm recommends that every dog owner carry liability insurance to protect against a claim for damages from a dog bite. But what happens when the dog bite claim exceeds the available canine owner's liability insurance coverage? This question creates enormous headaches for both dog owner and their liability insurance company.
Dog Owner With Little Liability Insurance
Dog bite liability insurance is not required in PA, but it's foolhardy to not carry at least some. Let's say a dog owner carries only $20,000 in renter's insurance for his little poodle, then, one little "nip" from the tiny canine causing facial disfigurement of a person who works as a model, causing not only pain, suffering, and medical expenses, but also lost wages and earning opportunity as a result of the animal attack. This particular dog bite claim -- though rare -- is potentially worth millions but coverage is only $20,000. This creates a massive gap, exposing the dog owner's assets to collection to satisfy a judgment in excess of insurance.
Potential Nightmare For Dog Owner
Having Any Liability Coverage For a Dog Bite Creates Leverage
Could the above case somehow settle for the amount of coverage, only $20,000?
The answer is, yes, every case is negotiable.
So why would the above plaintiff accept only $20,000? Lots of reasons. Defense counsel -- hired and paid for by your liability insurance carrier -- will have experience with dog bite cases in PA. He or she will look for a defense to liability: did the injured party antagonize the dog? Or, perhaps the dog owner is otherwise judgment-proof, having no assets to satisfy the judgment, making bankruptcy the only option, further delaying the receipt of any funds.
Hence, defense counsel can take the position: "Dear Plaintiff, to get the $20,000 of coverage available, you must to release all claims against the dog owner, sparing him of further liability. Otherwise, we'll keep defending." The leverage here is, the insurance carrier has a duty to defend, regardless of the amount of coverage, and must continue defending even after tendering 20K, so the insurance carrier will demand a release of all claims, before tendering the 20K.
Make sense? All that said, you should still have at least $200,000 in liability insurance for a dog bite in PA, as we explain in another article, because 20K in the case described above will likely expose your personal assets to collection.
Liability Insurance Company's Perspective - Potential Gap Coverage
A liability insurance carrier owes special duties to its insured in PA, including the duty to put a reasonable value on a claim and try to settle the case promptly. Otherwise, the insured could be dragged through unnecessary litigation -- after paying for insurance to avoid just that!
Bad Faith Insurance Practices in Dog Bite Cases
Pennsylvania created statutory -- 42 Pa.C.S.A. § 8371 -- and common law rights by dog owners, against their insurance companies for "bad faith," for exposing the insured to litigation and/or a judgment that embarrasses the insured and causes stress, and damage to his personal or professional reputation. After all, a high verdict makes it look like the defendant is irresponsible -- falsely -- if he had paid for liability insurance to cover claims against him, to pay injured parties so they don't have to sue.
It is well established in Pennsylvania that a liability insurance company acts in "bad faith" when it refuses to tender its policy limits promptly when the facts warrant it. In Birth Center v. St. Paul Companies, Inc., 787 A.2d 376, 567 Pa. 386 (2001), the defendant-doctor was sued for malpractice for the death of a child during birth. St. Paul Insurance Company provided liability coverage to the defendant-doctor and had a policy of "never settling" cases involving a "dead baby," allegedly. The malpractice case went to verdict, and the Defendant lost! The verdict greatly exceeded the amount of liability coverage. St. Paul owned up to it, and paid the entire amount of the verdict, even though it exceeded the liability coverage.
End of the story for St. Paul insurance?
Not by a long shot.
Insurance Carrier's Severe Liability to Insured Dog Owner
In the Birth Center case, the Supreme Court of Pennsylvania held that any insurance carrier in PA -- who unduly exposed the insured to litigation -- is liable to pay the excess verdict, as St. Paul had done. Only, the PA supreme court went a step further, and ruled that the the defendant-insurance company was also liable to pay punitive damages based upon:
§ 8371. Actions on insurance policies.
In an action arising under an insurance policy, if the court finds that the insurer has acted in bad faith toward the insured, the court may take all of the following actions:
(1) Award interest on the amount of the claim from the date the claim was made by the insured in an amount equal to the prime rate of interest plus 3%.
(2) Award punitive damages against the insurer.
(3) Assess court costs and attorney fees against the insurer.
Was this the end of the analysis? Again, not by a long shot, the court further held:
Today, we hold that where an insurer acts in bad faith, by unreasonably refusing to settle a claim, it breaches its contractual duty to act in good faith and its fiduciary duty to its insured. Therefore, the insurer is liable for the known and/or foreseeable compensatory damages of its insured that reasonably flow from the insurer's bad faith conduct."
Compensatory damages so "flowing" can include: aggravation, costs, and even damage to the Defendant's reputation, for creating the false impression that the defendant failed to take responsibility for it's actions. Thus, refusing the tender policy limits -- in a clear liability and high value dog bite case -- can create massive liability for an insurance company.
With that background, enter the litigants in a recent PA nightmare -- for all parties concerned.
Lynda Boccella v. Hichman
As Terell Owens famously said: "Getcha popcorn ready!" Only, this particular train-wreck outcome was not popcorn-ready for anyone. Regarding this dog bite lawsuit, everything went wrong, for the Plaintiff, Defendant, Insurance carrier, jury, and even the witnesses who testified.
In Lynda Boccella v. Hichman, if the jury's verdict of $3,000,000 was an accurate valuation -- if -- then it means the Defendant's $300,000 in liability coverage was woefully inadequate, yet it was not tendered until moments before closing arguments, as reported. This was far "too late," according to Plaintiff's counsel. By then, everyone had suffered through an unnecessary trial: the judge, jury, parties, and witnesses.
Indeed, as these dog bite attorneys can attest, by the time closing arguments come, the parties have already been put through an entire trial, and indeed it is "too late" to talk settlement, in may respects. By then, the parties and witnesses had already lost time: away from their families, their work, plus they endured the stress of a trial.
This is why we say, everything went wrong. So who's at fault? Lots of parties in this equation could have messed up. Perhaps the Plaintiffs lawyers failed to impress upon the insurance company the gravity of the claims until, indeed, it was "too late." Maybe they were at fault for this case going to verdict, unnecessarily.
However, these Pittsburgh lawyers highly doubt it. Here's why.
Valuation of Dog Bite Claims in Pennsylvania
The case of Lynda Boccella v. Hichman went to trial in Philadelphia, where verdicts on average for pain and suffering are at least three times higher than in Western PA, including Pittsburgh, where our lawyers practice. This is common knowledge. We know it. Other lawyers know it. Insurance companies should know it.
Therefore, any insurance carrier -- who fails to take prior dog bite verdicts into account -- does so at its peril. Thus, we place no fault whatsoever on the dog bite lawyers for the plaintiff in that case. To the contrary, we applaud them for zealously advocating for their clients, and not accepting the last minute tender of policy limits.
Pittsburgh Lawyers & Free Consultation For Dog Bite Claims
Our Pittsburgh attorneys offer a free consultation for any dog bite claim in Pennsylvania. Call or email us today!