Insurance plays many roles in virtually every injury lawsuit. First, it is important to know that rarely would any personal injury, wrongful death, or medical malpractice claim be pursued unless there was adequate insurance coverage insuring the wrongdoer (we lawyers often refer to the wrongdoer as the tortfeasor).
To operate a car legally in most states, including Connecticut, New York, Massachusetts, and Rhode Island, liability insurance coverage is mandatory. Further, many people wisely purchase additional protection in case a negligent driver has limited or no insurance coverage at all. This form of protection is called uninsured and underinsured motorist insurance. (See section on buying car insurance.) Also, doctors and hospitals almost always have medical malpractice insurance. Hospital privileges generally require such coverage for doctors.
While most lawsuits seek money damages that will be paid by the tortfeasor’s insurance company, a lawsuit generally does not name the tortfeasor’s insurance company as a defendant. However, make no mistake about it, the lawyer representing the tortfeasor is hired and paid for by the tortfeasor’s insurance company and the insurance company is usually making all of the decisions about whether to settle a case and for how much.
While the parties to a lawsuit, the lawyers, the judge, and most of the jurors know that the damages in a case will be paid by the wrongdoer’s insurance company, it has been the convention that lawyers and witnesses are to refrain from mentioning insurance during a trial unless there are special circumstances. Conceptually, the defense usually fears that the mention of insurance will put that thought in the minds of the jurors who may be inclined to award greater compensation that would otherwise occur if insurance is not on their mind. To this end, defense lawyers frequently file pre-trial motions, called motions in limine, to bar reference to insurance. Defense lawyers also generally insist that documents like the police accident report, medical records, and medical bills be altered (lawyers call it redacted) to eliminate references to insurance. Frankly, in this day and age, it seems unlikely that jurors will forget that cars, businesses, and doctors must be insured. Thus it seems to make little sense to redact documents when the judge, with proper instruction, can simply reinforce the notion that insurance should not be considered in making an award of compensation.
Aside from the insurance that insures the wrongdoer and the first party uninsured or underinsured motorist insurance, the other type of insurance that frequently comes into play in an injury lawsuit including a medical malpractice claim is medical insurance. We are all familiar with the intricacies of major medical insurance that plague patients and health care providers. Here again, generally, the jury will not hear about the existence of or payments by a major medical insurance company or HMO during the course of the trial. Under Connecticut law, after a jury verdict has been accepted by the trial judge, the opposing sides address the issue of the amount of insurance coverage that has been paid for the medical bills. That amount, reduced by the cost of the insurance premiums, is deducted from the verdict to arrive at a judgment. As a consequence, there is no windfall or double recovery for the medical expenses and it would be inappropriate for the jury hearing a case to make any assumptions about the effect of medical insurance. Because of these calculations that must be done, it is very important that the client save and provide to his or her lawyer all of the paperwork that reflects the payments made by any insurance company, HMO, Medicare or Medicaid.