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Q: If someone is injured in an automobile accident as a result of my negligence and the insurance company refused to settle within the limits of my policy, what happens if the trial jury awards damages in excess of my policy limits? Will I be responsible for paying the excess amount rather than my insurance company?

A: It depends. As your insurance company, they are responsible for operating in good faith on your behalf. If the company refuses to settle on a reasonable offer and allows the case to proceed to trial, some states require that the insurance company be held liable for all damages as a result of bad faith negotiations. In some instances, punitive damages may even be ordered to be paid by the insurance company if they are believed to have negotiated in bad faith.





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