I signed up a mother injured in a car wreck in Louisville, Kentucky last week. The problem is that the mother was driving a car owned by her daughter. Consequently, even though the driver/client was not at fault in causing the car wreck, I have to use the daughter’s automobile insurance to pay my client’s medical bills. This is why they call Kentucky a no-fault state. It does not mean that you can’t make a claim for pain and suffering against the at-fault driver. Rather, it means that the car insurance for the vehicle you are riding in is responsible for the first $10,000 of your medical bills and lost wages, regardless of how the car wreck occurs. As a result, I have dealt with several phones calls this morning from both the mother and daughter addressing their concern about using their own car insurance when the mother did nothing to cause the wreck.
The idea behind Kentucky no-fault law is that I should not have to prove fault for an automobile accident in order to get the medical treatment I need. As a result, the Kentucky statutes made this kind of coverage automatic. In essence, when you are involved in a motor vehicle accident in Kentucky whether you were or were not at fault for causing the wreck, you are immediately entitled to $10,000 of medical expense and lost wage coverage. So when you see attorneys advertise that they can immediately get you $10,000 on your personal injury claim, now you know what they are referring to. They are misconstruing the law for the purposes of an advertisement. You don’t get the $10,000 but rather, the insurance carrier has to provide you with medical expense and lost wage coverage up to that amount.
Kentucky law goes on to say that in exchange for that coverage, you give up the right the right to recover the first $10,000 of medical bills and lost wages from the at-fault driver. That legal right of recovery becomes the right of insurance carrier who is responsible for your medical bills and lost wages. If you think about it, it only makes sense. If we are going to obligate the no-fault carrier to pay your medical bills, they should have the right to recover any amounts paid. However, it is for this reason that you do not have a choice but to use your own car insurance to pursue your personal injury claim.
For example, if I submit a personal injury claim on behalf of my client and he has $5,000 worth of medical bills and I want another $6,000 for his pain and suffering claim for a total of $11,000, the insurance company will still only offer me $6,000 at best for my client’s pain and suffering claim. Why? Because they know that it is not my client’s right to recover the first $10,000 in medical bills but rather, it is the right of the no-fault carrier. They also know that if they paid me the full $11,000 on the claim, Kentucky law would still allow my client to make a no-fault claim for the $5,000 in medical bills. Then the no-fault carrier would have the right to recover the $5,000 they paid from the at-fault insurance carrier that now would have paid out a total of $16,000 on the claim when they should only have had to pay out $11,000.
I understand that is complicated. In essence, for a Kentucky motor vehicle wreck, the at-fault carrier will not agree to pay the first $10,000 of your medical expenses as part of your pain and suffering claim because of the risk that they might have to pay these bills twice. Consequently, to not use my client’s no-fault insurance would mean that I could not recover some of the medical bills that compose their personal injury claim. So yes, even though my client did not cause any part of the car wreck, I have to use her own car insurance or I cannot recover fully on her personal injury claim.
A topic for another day is Indiana law in regard to car wrecks and medical bills. In essence, Indiana law does it just the opposite and all medical expenses are considered part of the personal injury settlement.