Insurance Claim Form After Personal Injury

The collateral source rule is a law that applies in Nevada personal injury cases. It helps victims reasonably recover when they’re hurt. The law says that when a person’s injured, they can recover the full amount of their damages from the individual who hurts them even in cases where they have insurance or other ways to cover their losses.

 

What’s a Collateral Source?

When you’re hurt in a traffic crash, the person who causes the crash pays for your losses. They’re the primary source for recovery. If you have another source to recover your losses from, that’s called a collateral source.

 

In most cases, the collateral source is your own car insurance. That is, your insurance pays you an amount for your losses even though you look to the responsible person first and foremost for your recovery.

 

Nevada’s Collateral Source Rule

In Nevada, a person that’s hurt because of someone else’s behavior has a right to collect a full recovery from the person that hurts them. This is the case even if the victim has a collateral source such as insurance that’s also going to pay them no matter what.

 

The person responsible for the injuries can’t tell the jury about any other methods of payment that the victim might have. They also can’t use those payments to reduce or offset what they owe to the victim. Rather, the victim gets to make a full recovery from the person that’s responsible for their losses.

 

An Example of the Collateral Source Rule

This might play out when a person suffers an injury in an auto accident. The crash is the other driver’s fault. The victim brings a case to recover from the other driver for their losses.

 

The victim has $50,000 in damages. While the case waits for the court, the victim’s own insurance pays them $25,000. That leaves $25,000 in losses for the victim.

 

In this case, the victim can recover the full $50,000 from the responsible party. The responsible party can’t tell the jury that the victim has this insurance. Instead, the victim gets a full recovery for their losses.

 

What’s the Purpose of the Collateral Source Rule?

The purpose of the collateral source rule is to allow victims to get justice. Nevada lawmakers and courts don’t think it’s fair that a person should get less of a recovery just because they make a choice to purchase insurance. State law makes the judgment call that the person who chooses to buy the insurance should be the one who benefits from it. After all, they found the insurance and dutifully paid the premiums.

 

The courts believe that if a jury hears evidence about payments from a collateral source, it could bias their judgment. That is, they might let the responsible party off the hook because of the insurance even though they’re at fault. Refusing this kind of evidence at trial ensures that the jury bases their decision on only the relevant facts and law.

 

Workers Compensation Cases

One notable exception to Nevada’s collateral source rule is for worker’s compensation cases. In a worker’s compensation case, the jury can hear evidence that the victim has received worker’s compensation payments.

 

However, the court tells the jury to base the award on the full amount of the victim’s losses. The court also lets the jury know that the court uses funds from the judgment to repay the insurer or administrator for what they’ve already paid to the victim.

 

Recent Developments

Medical Lien After Personal Injury

Recent cases from the Nevada Supreme Court continue to strengthen Nevada’s commitment to the collateral source rule. One example is the 2016 Khoury case. In the Khoury case, the victim suffered injuries in an accident. Medical providers agreed to treat the victim on the condition that they get paid out of the victim’s personal injury recovery. This is called placing a lien on the recovery.

 

The medical providers then sold the liens to a third party for less than the total cost of care. The person responsible for the accident wanted to tell the jury about the lien and that the care provider sold the lien to someone else. They said that it was fair in order to argue to the jury that the true cost of medical care was less than the actual medical bills.

 

The court said that selling a lien to a third party amounts to using a collateral source for payment. As a collateral source, it’s not admissible to reduce a party’s recovery. The court went on to say that a lien might be admissible in court in order to argue to the jury that a doctor has a bias in the case in favor of the injured person because they want to get paid from the proceeds of the lawsuit.

 

The court said that a medical lien by itself isn’t a collateral source, so just the fact that the lien exists doesn’t trigger the collateral source rule. However, selling the lien to a third party is finding payment from a collateral source. For this reason, evidence of selling the lien isn’t admissible in court.

 

Subrogation

In states that allow insurance subrogation, an insurance company that pays benefits may sue the responsible person for reimbursement of their claim. Nevada doesn’t allow this for car accident claims.

 

They say that the victim can recover both from their own insurance and from the responsible party. The insurance company that pays the victim has no right to recover what they pay from the person who causes the accident. The case that talks about this rule is Maxwell v. Allstate Insurance.

 

Why Do I Need an Attorney?

An attorney can help you make sure that the other side doesn’t get away with trying to admit evidence of insurance payments or another collateral source. They can file paperwork before the trial to prevent the other side from even mentioning an insurer or other collateral sources of payment.

 

The right personal injury attorney can make sure that collateral source issues don’t become a road block as you work together to get you fair compensation in your case. They can also help you negotiate a fair settlement or prepare your case for trial in the best possible light. Ultimately, Nevada’s collateral source rule should work to your favor, because it prevents responsible parties from pointing fingers in other directions.