These types of cases are tragic. If my client needs a cervical spine surgery due to the defendant's negligence, yet this negligent numbskull had purchased only $25,000 of liability insurance (the minimum required in Georgia), my client is “up the proverbial creek without a paddle.”
If your attorney sends a demand letter according to certain legal standards for the policy limits of $25,000 and the insurance company refuses to settle for this amount, at the trial of the case (about 4 years later) a jury could award damages for an amount in excess of $25,000 and the insurance company would be liable to pay the full amount under what is called “bad faith.”
But what is even more likely is the insurance company recognizes your damages are extensive, probably far over the mere $25,000 of policy limits, and tenders the $25,000. If there is no other insurance available to pay for your serious losses, wage loss, permanent impairment, loss of future wages and pain and suffering, then you are left with the option of suing the individual personally.
Frankly, no lawyer wants to do this unless the defendant has lots of personal assets to collect a judgment from. But if this same defendant has lots of assets, a large house, a business, lots of cars or real estate, that defendant would be smart enough to have a much larger policy or policies of insurance so as not to lose these property assets.
If you did sue the defendant personally and could prove you had, for instance, $300,000 of damages, and a jury could grant you that amount, now you have to go and collect this amount. You would then have to hire a collection lawyer to chase this fellow all over creation to find his assets. Then the defendant could bankrupt against a jury decision.
So, the sad news is that you would have little or no chance of collecting over the “hypothetical $25,000” from either the insurance company or from the defendant.
But, there is hope. It is called Uninsured or Underinsured Coverage. Let's talk about this form of insurance next time.