Prompt Offer of Policy Limits Defeats Attempt to Set Up Insurer for Bad Faith

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Daniel Ilias was badly injured in a multi-vehicle automobile crash. The driver at fault for the accident was insured by Defendant USAA General Indemnity Company. Ilias sued the driver for his injuries and obtained a judgment for $5,230,559.44. Ilias then brought this third-party bad-faith action against USAA, who had insured the driver for $10,000. Ilias sued USAA for its purported bad faith in failing promptly to settle Ilias’s personal injury claim against its insured. USAA moved for summary judgment. In Daniel Ilias v. USAA General Indemnity Co., Case No. 8:20-cv-834-WFJ-TGW, United States District Court Middle District Of Florida Tampa Division (June 24, 2021) the injured person received a more than $5 million Judgment after failing to accept a policy limits offer.

ZALMA OPINION

Bad faith set-ups exist because courts often allow them to succeed. Even finding that Furman attempted – although poorly – to set up USAA for a bad faith suit the court was not willing to fault Furman for her attempt because of the serious injuries suffered by her client. The judge was wrong – there is no reason to attempt to create a bad faith suit – when an insurer acts fairly and in good faith and offers up its full policy limits. A bad faith set up is an attempt at fraud and, in this case, the injured person testified he would have accepted the $10,000 policy limit if Furman had so advised him. This type of conduct should not be faultless but should, rather, be condemned.