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Comment by dragonwriter | Hacker News Reader

> ...I got zero ($0.00, zlich, nada) from the other driver's liability insurance.

Well, yeah, you didn't legally establish any liability, or even, apparently, make even the suggestion of the intent to do so.

Insurance companies, being for-profit entities, aren't in the business of giving out gifts.

> Now, if I had comprehensive coverage, they'd be facing my insurance company

Yes, dealing with other driver's insurance companies (along with uninsured drivers) is among the more significant reasons to carry more than liability coverage.

> The whole thing is a scam.

I don't see a scam anywhere.

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The police report, however, did. Throwing ones hands up to say "well, of -course- the company is going to avoid paying anything out unless taken to a court of law" is to abdicate corporations of all responsibility other than profit making. Just because a person can't afford justice doesn't mean we should accept injustice.

> The police report, however, did.

Police reports are evidence that can support a finding of liability, but they are not a legal establishment of liability. There are very good reasons (the due process clause of the 14th Amendment comes to mind) why that should be the case, it's not a scam..

> Throwing ones hands up to say "well, of -course- the company is going to avoid paying anything out unless taken to a court of law" is to abdicate corporations of all responsibility other than profit making.

Untrue. The corporation here has other responsibilities, but they are all to their paying customer.

So you don’t think corporations have any responsibility to act ethically?

> responsibility to act ethically

They have the opposite responsibility, if anything... They have a fiduciary duty to their shareholders, and considering that the behavior being suggested here would see them quickly run out of business by their less-moral competition, it would probably be a breach of that duty.

The solution is to change laws about redress. For example, statutory punitive damages and attorneys' fees in lawsuits against insurers where the final judgement is significantly different from the insurer's initial offer.

Talk about what is ethical is idle because that simply does not drive corporate behavior.

> They have a fiduciary duty to their shareholders...

Citation please.

Does this work?

https://www.nolo.com/legal-encyclopedia/fiduciary-responsibi....

No, that paragraph describes the duty of officers of the company to put the interests of the company before their own. It doesn’t claim that these officers need to behave unethically. You could even argue that displaying unethical behavior is not in the best interests of the company in the long run but this is of course hard to prove in any direction.

You asked for a citation of fiduciary duty. I already explained why that precludes moral action in this case

I now realize I misinterpretted your prior reply as copypasta of the "maximize shareholder value" trope.

My apologies.

>The solution is to change laws about redress. For example, statutory punitive damages and attorneys' fees in lawsuits against insurers where the final judgement is significantly different from the insurer's initial offer.

1. I you're supposed to have negotiated with the counterparty in good faith prior to a lawsuit. If not, that will be looked negatively by the judge. https://www.sbwllp.com/rule-68-offers-of-judgment/

2. This probably doesn't play well with probabilities/statistics. Suppose we accept your proposal, and say any final judgement that's 5x larger than the offered settlement should be hit with extra damages. Now a lawsuit comes along that the insurance company thinks there's a 12.5% chance of winning, and if they win, the damages awarded will realistically be $1M. Based on expected value calculated from the previous facts, and factoring in court/attorney's fees, the insurance company offers the plaintiffs $150k to settle. That seems like a good offer for all parties involved. However, if the plaintiff gets greedy, and on the off chance he wins, the insurance company will have to pay extra damages, because from an initial offer to final judgement perspective the disparity is huge.

Part 1 is just a matter of public policy. This is all armchair theory anyway.

Regarding Part 2, I actually don't see the problem. If the result is causing insurance companies to be more cautious about lowball offers when there's a range of reasonable outcomes, is that bad? The plaintiff still must succeed at proving damages, so it's not like that outcome is unforseeable.

It does increase "settlement risk" for insurers, but _they're insurers_. Of every kind of entity out there they should be the most comfortable with risk. The greater risk of unfavorable settlements would obviously increase insurance premiums, but if premiums increase because insurers are actually paying more in fair settlements and/or punitive judgements because they failed to pay a fair settlement, again I cannot see the problem.

>but if premiums increase because insurers are actually paying more in fair settlements and/or punitive judgements because they failed to pay a fair settlement, again I cannot see the problem.

But the problem is that in the example I given, the lowball option is fair given the probabilities/expected value.

Corporations are no more ethical than wild animals. "Responsibility" doesn't enter into it, the fact is they don't understand human morality and can't be made to, so you have to handle them with that in mind.

Good luck proving it was unethical as compared to a ‘misunderstanding’. A lot of people are pretty good at CYA.

Being on the shitty end of the stick, of course the poster sees what is happening. But until a judge or impartial third party with some pull sees it, it might as well not exist. And that’s hard.

The idiot of your whole thread is that while you're talking about how "insurance is a scam". Well, you might not like taking the complicated process needed to get stuff from an insurance company, sure. But if you were instead just dealing with an individual, it's obvious your situation would be not better but completely impossible.

>I don't see a scam anywhere.

They are telling the government they will pay out if the insured party is at fault for an accident, but in some (many?) cases they don't actually pay out. That sounds like a scam to me.

> They are telling the government they will pay out if the insured party is at fault for an accident

No, they aren't.

They are telling the government and their customer they will pay out if the insured party is found to be legally liable for injury or property damage while driving. (That is, in exactly the situations where the customer would legally be obligated to pay.)

They are also telling their customer that they will defend them from such claims to the extent reasonable, settling where it makes sense to contain liability. That is actually a big part of why one would pay for insurance rather than posting a liability bond (as most states allow) unless you have the funds to keep a general attorney on retainer and seek task-specific representation as needed.

Had they paid out when there was no expectation you would establish liability, that would be a scam against their paying customer.

In this case, who is legally liable?

No one. It's up to a court to decide. If you haven't been declared liable/guilty by a court, you're not liable/guilty. It's simple as that.

> They are telling the government they will pay out if the insured party is at fault for an accident

A police report doesn’t establish proof of fault. Neither does a video. Neither does eye witnesses. All of those are evidence of fault, but not legal proof of fault.

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