Understanding the Role of Insurance Companies in Auto Accident Cases

The role of an insurance company in an auto accident case is simple. However, depending on the complexity and legal issues involved in the specific circumstance, an insurance company’s role may become expanded or at the least, more involved.

In simple terms, an insurance company’s role is to protect its insured motorist against any claims involving an auto accident. Their role is also to pay up to the limits of their policy for all damages caused to another party by their insured motorist.

This role means that they will also investigate and defend their driver’s liability if there is a lack of evidence demonstrating that their driver was at fault. An insurance adjuster’s job is not to simply pay out what is asked by an attorney during negotiations. In fact, their job is quite the opposite. They aim to pay out the lowest possible amount – even if their driver is proven to be at fault.

The Different Types of Insurance Coverage

There are numerous types of coverage one can purchase in California.

The type of coverage you buy should largely abide by the minimums set forth by the state, as well as any additional coverage that you feel may best suit your needs. Regarding the state mandatory minimums, according to Geico Insurance, in the state of California, motorists are required to carry:

  • California requires drivers to carry at least the following auto insurance coverages:
  • Bodily injury liability coverage: $15,000 per person / $30,000 per accident minimum
  • Property damage liability coverage: $5,000 minimum
  • Uninsured motorist bodily injury coverage¹: $15,000 per person / $30,000 per accident minimum
  • Uninsured motorist property damage coverage¹: $3,500 minimum

As far as the differing types of auto insurance, there are six primary coverage types. These types range from personal liability coverage, comprehensive coverage, collision coverage, and uninsured/underinsured motorist coverage to medical payments coverage (also known as med pay), and gap coverage. There are also umbrella policies. While they are not a type of car insurance coverage, they can still help if your liability exceeds your coverage, in which case, your umbrella policy can cover any remaining amount up to the umbrella policy amount.

How Insurance Companies Investigate Auto Accidents

Insurance companies are compelled to investigate any claims petitioned to recover damages. They do this for two main reasons. One, they investigate all claims to protect themselves from fraudulent claims. And two, they need to gather as much information as possible to perform their own calculations of the damages in order to counter any amounts claimed by the attorney. This is where negotiations come into play.

In any case, adjusters are sent by the insurance company to perform their own investigations to find culpability and calculate damages.

In order to do this, the adjusters will first interview the driver in an attempt to validate liability. They will also interview any passengers and eyewitnesses to the accident. Next, they will inspect both vehicles, assessing damage to not only calculate the cost of the damages but also to determine who was at fault in the accident. Last, they will request all medical records and, if necessary, investigate the claimant to ensure the claims made in the suit are accurate and valid.

Insurance Company Tactics to Reduce or Deny Claims

Insurance companies often deploy defense tactics to avoid paying a fair settlement. Remember, an adjuster’s job is to protect the company, not you. They will sometimes go pretty far to avoid paying a fair amount, so much so, that they may be willing to take it to trial to prolong payment or to try to avoid it altogether.

Some of these tactics are:

  1. They may contact you right after the accident. They do this before you’ve had a chance to assess the extent of your injuries and damages and before you have had a chance to hire an attorney. Adjusters may make you an offer in the hopes you will accept it to avoid paying a large settlement down the road.
  2. They may ask you for a statement on the record. They do this to use against your claim, to prepare for any claims down the road, and to find anything that may be contradictory to devalue your claim.
  3. They may attempt to fight against all or a portion of your medical claims. Never forget, insurance companies are not your friend. They will do anything they can to get out of paying.
  4. They may attempt to delay the process. Insurance companies routinely act as if they don’t care, forgot, or simply haven’t gotten to you yet. They do this to cause frustration because they know you are financially vulnerable. They want to be sure you are in need so they can get you to agree to a lower figure or to give up entirely.
  5. They may attempt to misrepresent the law or try to tell you that hiring an attorney is pointless. They do this to prey on your worries and fears so they may take advantage and get you to either forget about filing a claim or get you to accept a ridiculously low offer.

Remember to never give any statements to insurance adjusters. In fact, it’s better to not speak to the other driver’s insurance company at all. Always seek medical attention right away and contact an attorney. A skilled personal injury lawyer will always protect you and your interests. They will speak on your behalf.

The Role of an Attorney in Dealing with Insurance Companies

An experienced attorney will represent you to the fullest extent of the law. They will explain to you the law as it pertains to your specific case, helping you to understand where you stand and providing you with a rundown of your legal options. They will give you legal advice, letting you know the direction they feel is best for your case, how to get there, and the steps you need to take. 

A qualified personal injury attorney will also file your claim on your behalf and handle all the paperwork involved. This includes collecting evidence, and medical records, and calculating a fair settlement offer. If, however, the insurance company does not act in good faith, your lawyer will be prepared to litigate your case in court. This happens when an insurance company refuses to negotiate a fair settlement offer. When this happens, your attorney will sue the insurance company. You will then have legal representation in front of a judge.


The role of insurance companies in auto accident cases is to protect their insured motorist and company. They will try to find ways to delay case proceedings if possible to get you to accept low offers. They investigate claims to find fault and to calculate monetary damages. They will also find any reason to avoid paying you a fair settlement award. Finally, they will make every attempt to get you to provide a statement to them on the record to use against you and not hire a lawyer.

Always be sure to seek medical attention and speak to an attorney right away. Never give statements to the opposing insurance company or give any statements at all. A qualified attorney, such as Pyramid Legal, will protect your rights and get you the biggest settlement award under the law. They will collect evidence, make statements, file your claim, and handle all paperwork on your behalf.

If you’ve been injured in an auto accident, slip and fall, or due to the negligence of another, contact Pyramid Legal today.

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