$1 Million Recovery Despite Inadequate Insurance and Coverage Dispute
John Doe was headed out for a lunch break when the Proclean van crossed the center lane and hit his pickup head on. John's most serious injuries were his broken left ankle, which required external fixation, and a torn anterior cruciate ligament in his right knee, which required surgical repair. The injuries immobilized John for months and made it difficult for him to return to his job as a warehouse supervisor.
Proclean had only a $300,000 liability insurance policy. When Pajcic & Pajcic offered to take the limits, Proclean's attorney recommended settlement, but the insurance company decided to raise a coverage defense and file a declaratory judgment action against Proclean.
The key question in the declaratory judgment action was whether the Proclean driver was covered by the insurance policy. The insurance company listed him as an excluded driver, but subsequent notices from the independent insurance agency created ambiguities.
John's case against Proclean settled at mediation for a $100,000/$1,000,000 high-low agreement contingent on the outcome of the declaratory judgment action. After further discovery that case was resolved in favor of coverage. The insurance company is now pursuing the insurance agency and its insurer for reimbursement.