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If you’ve been injured in a car accident was caused by another driver’s negligence, you are likely wondering who exactly is responsible for paying your medical bills related to the car accident—the at-fault driver’s auto insurance carrier? Your auto insurance carrier?

Many of our clients are surprised to learn there is nothing in Tennessee law that requires the at-fault driver’s insurance carrier or your own uninsured/underinsured motorist insurance to pay your medical bills after a car accident.

At-Fault Driver’s Insurance Carrier

The adjuster for the at-fault driver’s insurance carrier will often tell injured claimants to “send me your medical bills as you receive them,” and then they usually follow up with something to the effect of “we will make this right” or “don’t worry, we are accepting liability.” This kind of misleading rhetoric from adjusters leads claimants to believe that the at-fault driver’s insurance company will pay their medical bills related to the accident upon receipt. This is not true. The at-fault driver’s insurance company will not piecemeal settlement monies by paying your individual medical bills. The insurance company for the at-fault driver will not pay out any money on your injury claim unless you agree to release their insured from any and all liability. In other words, they don’t pay you a cent until your entire injury claim is resolved.

Underinsured/Uninsured Insurance Coverage

If the driver that hit you was uninsured or underinsured, you may be dealing directly with your auto insurance carrier regarding your injury claim. Similar to the at-fault driver’s insurance carrier, your uninsured/underinsured motorist coverage will not pay individual medical bills prior to the resolution of your injury claim.

Medical Payment Coverage

On the company’s website, Allstate defines medical payment coverage as follows:

Medical Payment Coverage is part of an auto insurance policy. It may help pay your or your passengers’ medical expenses if you are injured in a car accident, regardless of who caused the accident…Medical payment coverage is sometimes referred to as medical expense coverage or just “med pay.”

Medical Payment Coverage is the only type of auto insurance coverage that will pay your medical bills upon receipt prior to the resolution of your injury claim. Typically, medical payment coverage has a policy limit of $5,000 or $10,000 per person. Whether or not you should use your medical payment coverage to pay your medical bills after a car accident can be a somewhat complicated issue.

Tip: Regardless of whether you decide to use your medical payment coverage or not, one of the first things you should do after a car accident is notify your auto insurance carrier in writing NOT to make direct payments to any medical providers under your medical payment coverage without your explicit approval.

This prevents the emergency room or hospital that treated you after the accident from using part or all of your medical payment coverage. Going straight for an injury victim’s medical payment coverage is the hospital’s way of collecting 100% of the total charges without having to give the contractual discount they have to give your health insurance carrier or even the self-pay discount they automatically give all patients that are uninsured (which is often 50% of the total charges). The reason this is so important to someone injured in a car accident is because any monies paid to health care providers through medical payment coverage or health insurance are subject to what is known as “subrogation” (often referred to as subro).

Subrogation

Basically, subrogation means if your health or auto insurance carrier makes payments on your behalf to cover medical expenses or other damages that are related to the car accident, it is legally entitled to reimbursement of those payments from any settlement you receive from the at-fault party.

Here’s an example of how subrogation could impact your settlement:

Jack and Jill were injured in a car accident that was not their fault. They both go to the emergency room after the accident and incur $10,000 in charges. They both have health insurance and also have $10,000 in medical payment coverage under their auto insurance. They each receive a $30,000.00 settlement from the at-fault driver. However, Jack’s net recovery from the settlement is $27,000 and Jill’s net recovery from the settlement is only $20,000. So why did Jack receive $7,000.00 more than Jill despite having identical medical bills and receiving identical settlements from the at-fault driver? The answer is that Jack’s $12,000 emergency room bill was submitted to his health insurance, who received a contractual discount, which brought the total charges down to $3,000. This means that out of his $30,000 settlement from the at-fault driver’s insurance company, Jack only had to pay $3,000 in subrogation to his health insurance carrier, leaving him with $27,000 in his pocket. On the other hand, Jill’s $12,000 emergency room bill was submitted to her auto insurance and paid under her medical payment coverage, so she received no contractual discount and paid the full $10,000 available under her medical payment coverage directly to the hospital. Basically, out of Jill’s $30,000 settlement, she was required to pay $10,000 in subrogation to her auto insurance company, leaving just $20,000 in her pocket, even though the actual settlement amount was the same as Jack’s.

As I’ve mentioned in previous articles, the best way to get your medical bills paid after a car accident is to submit them to your health insurance carrier. For an in-depth explanation, read “Why You Should Submit the Medical Bills From Your Car Accident to Your Health Insurance ASAP.”

Car accident victims who mistakenly believe that the at-fault driver’s insurance company will automatically pay their medical bills when they send them to the carrier are often unpleasantly surprised to learn those same medical bills have been turned over to collection and their credit score has dropped significantly. If you are injured in a car accident and don’t have health insurance, it’s a good idea to contact the medical providers directly to set up a payment plan so you can avoid having the bills turned over to a collection agency.

1. If You Were Hurt In A Car Accident, Then The Adjuster Is NOT Your Friend.

The adjuster is not your friend. Seriously, they’re not.

The more significant the damages are in your car accident case, the more likely it is that the adjuster contacting you will act like your friend—at least at first. If the adjuster believes the value of your injury claim is below $5,000, they are more likely to be rude and abrupt. (Many of my clients relay in our initial consultation that the adjuster handling their claim actually hung up on them more than once.) If an insurance company perceives that they have a significant loss exposure, the adjuster is most likely going to establish rapport with you and will seem helpful and fair, at least until they start talking about money.

One reason, on high damage injury claims, that the adjuster may be friendly and even appear helpful is that they want you to trust them when they tell you, “you don’t really need to hire an attorney; they’ll just take part of your money.” The adjuster does not want a claimant to have an advocate that understands the ins and outs of the claims process—that would make it more difficult for them to settle the claim for a fraction of its actual value.

When an adjuster says “we accept responsibility,” it does not mean the adjuster will make a fair or reasonable settlement offer to resolve your claim.

Helpful Hint: Insurance adjusters commonly use phrases such as “we accept responsibility,” or “we are going to take care of you” to lull claimants into thinking they will be fairly compensated for all their damages.

Generally, the innocent victim mistakenly believes that if the insurance company accepts responsibility, then the company has a duty to fairly compensate the victim for his or her damages.

Frequently, it is only after the adjuster actually discusses compensation that the personal injury victim realizes that they need an attorney. Unfortunately, that usually happens many months after the accident, and many things that should have been done to document the claim have not been done because the victim expected fairness by the insurer.

2. Communicate With The Adjuster In Writing Not Over The Phone.

Communicate with the adjuster handling your claim by email whenever possible.

During the first conversation with the adjuster, get all their contact information, including email address, physical address, fax number and phone number. Immediately after that first conversation, send the adjuster an email confirming your conversation and stating you are willing to provide them with the necessary information to evaluate your claim, but all communications must be through email. Adjusters like to do their dirty work over the phone. They will be reluctant to use some of their shadier tactics if you force them to communicate with you in writing.

3. Do Not Give A Recorded Statement To The Insurance Company.

What you say can hurt you!

Insurance adjusters will want to take recorded statements from a personal injury victim soon after a car crash. Some may even suggest they cannot process a claim unless you give a statement. This is not true in Tennessee for injury claims made to the other party’s insurer!

Helpful hint: It’s not a good idea to give a recorded statement to an adverse adjuster after a car accident.

However, if you give a recorded statement to an adverse adjuster, be very careful what you say.

The insurance adjuster handling a car accident claim has several huge advantages when dealing with a unrepresented claimant. Adjusters have usually handled hundreds of accident claims. They have been trained in how to take statements from personal injury victims that illicit information from the victim that hurts their injury claim. Do not let them put words in your mouth. A question such as “When did you first see the other vehicle?” is a loaded question because it assumes that you saw the other vehicle prior to impact.

Another area of conversation that comes up in recorded statements is the extent of injuries. Sometimes, a victim may not know the extent of their injuries until after a day or two, or even later. Other times one area hurts so badly that other medical problems are not identified. Also, be weary of an adjuster that asks you if you are okay. Many of my clients have had an adjuster justify low-ball settlement offers by saying “You said yourself you were okay when I spoke to you immediately after the accident.” Avoid giving statements while taking medicine.

If you give a recorded statement to the adverse adjuster, follow these guidelines:

• Do not volunteer information.
• Do be truthful and concise
• Don’t guess if you’re not sure.
• Qualify your answers when appropriate.

4. Do Not Sign A Medical Authorization For The Insurance Adjuster To Obtain Your Medical Records.

The insurance adjuster will try to get you to sign a medical authorization allowing them to get your medical records. Don’t do it. Adjusters use medical authorizations as a way to try and dig up something in your prior medical history they can use against you. If you look closely at the medical authorization it usually gives the adjuster complete access to your medical history and your employment records. You should get copies of your medical records and billing related to the wreck and provide them to the adjuster.

5. Finish Your Medical Treatment Before You Settle Your Injury Claim.

Adjusters often want to pressure injured claimants into prematurely discussing settlement amounts before they are done being treated. Don’t fall for it. Make it clear to the adjuster you will not discuss any settlement offers until you’re fully healed or released from treatment by your doctors.

Underinsured Motorist Bodily Injury Coverage:

Coverage that pays for your bodily injury and related medical expenses when you’re injured in an automobile accident and the responsible party (other than yourself) doesn’t have adequate auto insurance.

Uninsured Motorist Bodily Injury Coverage:

Coverage that pays for your bodily injury and related medical expenses when you’re injured in an automobile accident and the responsible party (other than yourself) doesn’t have auto accident insurance or can’t be located (hit-and-run).

Vehicle Identification Number (VIN):

Your vehicle’s serial number assigned by the manufacturer. The VIN identifies the year, make, model, options and other information that are unique to your specific vehicle.

At Fault:

The degree to which you caused or contributed to an accident, or are “at fault,” and determines whose auto insurance company pays what portion of the damages. The method by which this is determined varies from state to state.

Bodily Injury Coverage:

If you are at fault for an automobile accident, bodily injury coverage, or an auto insurance policy, pays the medical expenses and additional damages for which you are liable for other individuals injured in the accident.

Liability Coverage:

Coverage for damages your auto accident causes to others and their property.

Claim:

When you suffer a loss that’s covered by your insurance, such as an automobile accident, you submit a request to your auto insurance company to pay or reimburse you for expenses, damages, and other financial obligations.

Claims Adjuster:

A representative of an auto insurance company who investigates and settles claims to ensure that all parties—you, your auto insurance company, and any else involved—receive fair compensation.

Collision Coverage:

Coverage that pays for physical damage to your vehicle caused by rolling over or a collision with another vehicle or object, such as a building, fence or telephone pole.

Covered Loss:

Any damage to yourself, your vehicle, or other people or property that is covered under your insurance policy.

Exclusions:

Specifically identified situations that are not covered by your auto insurance policy.

Deductible:

The portion of a covered loss for which you are responsible, as opposed to the portion your insurance company pays. A higher deductible allows your insurance company to offer you lower premiums, as you assume responsibility for a larger amount of loss.

Declaration Page (Dec Page):

An auto insurance coverage summary that lists the following:

• Types of coverage you have elected
• Costs for each coverage
• Specified vehicles covered by the policy
• Types of coverage for each vehicle covered by the policy
• Other information applicable to the policy

Medical Payments (MedPay) Coverage:

This is an optional moto insurance coverage that pays for reasonable and necessary medical and funeral expenses for a person covered by the policy. These expenses must be incurred as a result of an auto accident.

Named Person:

The first person in whose name the insurance policy is issued.

Occasional Driver:

A person who is not the primary or principal driver of the insured vehicle is an occasional driver.

Principal Driver:

The person who drives the car most often is the principal driver.

Property Damage Liability Coverage (PD):

If an insured person is legally liable for an accident, PD coverage pays for damage to others’ property resulting from the accident. PD also pays for legal defense costs if you are sued—but certain exclusions may apply.

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Donnie Surber, 48, was killed in a car accident on Chapman Highway at Tipton Station Road on April 11, 2019, according to the Tennessee Highway Patrol. Isaac Lynn, 28, was injured in the crash. Lynn was driving north on Chapman Highway when he allegedly crossed the center divide into the southbound lanes, striking Surber’s vehicle head-on. Lynn was taken to UT Medical Center for injuries he sustained in the crash.

This makes the third fatality in 2019 on the 22-mile stretch of Chapman Highway from Knoxville to Sevierville. On December 29, 2018, another tragic death from a car accident on Chapman Highway sparked renewed public interest in the dangerous condition of Chapman Highway. Knoxville Fire Captain DJ Corcoran and his wife Wendy lost their son Pierce in the December 29, 2018 car crash. Since the death of their son, the Corcoran’s have joined the public debate regarding how to make Chapman Highway safer.

Last week, Wendy Corcoran asked officials to reconsider the James White Parkway bypass, a proposal to improve safety and congestion on Chapman Highway that was vetoed by Mayor Madeline Rogero six years ago. Mayor Rogero is opposed to the James White Parkway bypass because it would endanger the Urban Wilderness she worked to establish. The James White Parkway bypass was outlined in the 2006 Chapman Highway Corridor Study prepared by the Knoxville-Knox County Metropolitan Planning Commission. The vision for the James White Parkway bypass was that it would be a traffic mover with no commercial development.

Concerning the frequent auto accidents on Chapman Highway, the 2006 study found that a large percentage of vehicle crashes occurring on Chapman Highway are rear-end collisions…More serious injuries and fatalities typically happen in the locations with no center turn lane. The most recent fatality on Chapman Highway was allegedly caused by a driver crossing the center line and hitting a vehicle head on.

The 2006 study recommended the following measures to increase safety on Chapman Highway:

• Providing space for different modes—bicyclists, pedestrians and motor vehicles
• Informing users of the mix of modes
• Providing uniform and predictable designs and traffic control, based on context
• Establishing appropriate design speed, based on context
• Adding appropriate design elements (center turn lanes or medians, right turn lanes, etc.)
• Providing adequate sight distance

Thirteen years after the 2006 study, the Tennessee Department of Transportation still believes an alternate route to divert traffic from Chapman Highway is necessary. The position of the department remains that this is a roadway that you need to get a lot of cars off of, said Mark Nagi, spokesman for the Tennessee Department of Transportation. We’re doing what we can with Chapman Highway, but we don’t believe that without getting a lot of cars off of that roadway, that we can make Chapman Highway as safe as it can be.

The IRS has issued guidelines regarding the taxation of personal injury proceeds. Any amount received as a result of a personal injury or wrongful death settlement can be taxable, nontaxable, or partially taxable depending on the type of case and the type of compensation for injuries suffered.

However, settlement monies related to the physical injuries you sustain in a car accident are not usually taxable according to Section 104 of the tax code.

The IRS generally categorizes damages in car accident cases into two subsets: compensatory and punitive. Compensatory damages are meant to compensate you for your loss (i.e., the injury you sustained in the car accident). Punitive damages are added to any compensatory damages in situations where the defendant acted recklessly, with malice or deceit, or in any other manner that would justify penalizing the wrongdoer or making an example to others. An example of a car accident case where punitive damages may be awarded is one where the at-fault driver was intoxicated at the time of the wreck.

Below is a breakdown of different categories of damages in car accident cases, along with a brief explanation on whether each category is usually taxable.

Medical expenses

An injured party in Tennessee is entitled to recover for medical expenses reasonably and necessarily incurred in the treatment of the injury caused by the accident. These medical expenses can include hospitalization, surgery, physical therapy, MRI, etc. Medical expenses included in a car accident are not usually taxable. However, if you took deductions on your latest tax return and received a reimbursement, the reimbursement may be taxed.

Pain and suffering

An injured party is also entitled to damages for the pain and suffering they experience related to the injuries received in the car accident. This category of damages is not usually taxable.

Lost wages

Car accident victims often miss work because of the injuries they suffered in the wreck. Lost wages provide these victims with compensation for the wages they would have earned if the accident had not occurred. Because wages are generally taxable income, lost wages are taxable. If you are a business owner, and your settlement includes damages related to lost business income, such monies are generally taxable as well and are also often subject to Social Security and Medicare taxes.

Emotional damages

As referenced above, compensation received for emotional distress and mental anguish originating from a personal physical injury or physical sickness are non-taxable. But if the proceeds you receive for emotional distress or mental anguish do not originate from a personal physical injury or physical sickness, you must include them in your income. However, the amount you must include is reduced by:

• amount paid for medical expenses attributable to emotional distress or mental anguish not previously deducted, and
• previously deducted medical expenses for such distress and anguish that did not provide a tax benefit

Punitive damages

The Internal Revenue Code states that punitive damages may be subjected to taxation. Because punitive damages are intended to punish the behavior of the at-fault party, rather than to help the victim recover, they are usually taxable.

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A Tennessee traffic accident can bring life as you know it to a halt, at least temporarily.

While your focus may be on your recovery from your injuries and getting your family back on track, you will not be able to help worrying about the bills, car repairs and medical expenses piling up while you are out of work. You are really counting on the insurance claim to help your family through the tough times.

You want to be certain you obtain the maximum amount of benefits you deserve. However, it is the job of the insurance adjuster to pay as little as possible for your car accident claim. For this reason, you will want to be aware of the tactics an adjuster may use to trick you into jeopardizing your claim.

Be alert!

Representatives from insurance companies count on the fact that you may have little experience with insurance claims, and that you are distracted and confused by your own circumstances. If you are aware of the ways insurance adjusters may try to trick you into defeating your own case, you may be able to skillfully avoid them. Some examples include the following:

Making friends:

By gaining your confidence when you are at your lowest, they hope to get you to say things they can use against you or to get you to accept a meager settlement.

Recording your statement:

You cannot refute something you have said on a recording, and the insurance companies know how to manipulate your most innocent statements.

Saving you time:

With this pretense, an insurance adjuster may ask you to sign a blank medical record and offer to fill in the rest as a courtesy. This will never end well for you.

Making impossible demands:

An insurance company may require you to present unreasonable proof of your lost wages or other damages that is impossible to compile.

Rushing your decision:

Since it isn’t always easy to see how serious your injuries really are, the first offer an insurance company makes is seldom enough to cover your case.

The best advice for encounters with insurance companies following an accident is to be polite, professional and impersonal. Allow your attorney to handle the insurance adjuster while you focus on your recovery. If your attorney has past experience dealing with the tactics of insurance companies, you will not have to worry about being trapped by these tricks.

In Tennessee, the at-fault driver is not required to provide you with a rental car if your vehicle is a “total loss” (Prewitt v. Brown 525 S.W.3d, 616 [Tenn. Ct. App. 2017]). Despite this case law, many insurance companies covering at-fault drivers in Tennessee will still pay for a rental car after an accident, so our advice is to go ahead and request a rental car from the at-fault driver’s insurance company—the worst they can say is no.

Even if your vehicle is a total loss and the at-fault driver’s insurance company is denying your request for a rental car, you may still be able to get a rental car under your own insurance policy. To determine whether rental reimbursement is available under your auto insurance policy, look at the declarations page for your policy. If your policy does include rental reimbursement, the length of time the insurance company is obligated to pay for your rental car after an accident will be controlled by the language of your policy.

Typically, insurance companies will pay for your rental car for the period of time your car is being repaired, or if your vehicle is a total loss, for 72 hours after they make an offer of settlement to you for your vehicle. Most policies also include a cap of 30 days for rental car coverage and an average monetary cap of around $900.

If you have been injured in a car accident, and are dealing with the at-fault driver’s insurance company, then chances are the adjuster handling your claim has asked you to sign an Authorization to Release Medical Records.

On its face, it seems like a good idea to go ahead and sign the authorization. You have to get the records and bills anyway, right? Why not let the adjuster do the work for you? The insurance adjuster will make it sound like he needs them in order to pay you what you are entitled to. Unfortunately, this is far from the real truth of why he wants your medical records.

Here is the real reason the adjuster wants you to sign that medical authorization: Adjusters use medical authorizations to obtain a claimant’s past medical records completely unrelated to the car accident. Then the adjuster will use those past medical records as justification to make a low-ball settlement offer to resolve your claim.

Let’s look at an example. Jane Doe was recently in a car accident where she suffered a herniated disk in her lumbar spine. Five years prior to the car accident, Jane Doe was eight months pregnant and mentioned to her doctor she was having some low back pain. If she signed a medical authorization, the adjuster would be able to obtain Jane Doe’s past medical records from her OBGYN, and would inevitably use those past records as “proof” that Jane Doe’s herniated disk was a pre-existing condition, thus drastically reducing the settlement offer in her car accident claim.

Bottom line: We recommend you do not sign a medical authorization from the at-fault driver’s insurance company.

Distracted driving has been around as long as there have been automobiles.

People eat, drink, look at maps and engage in any manner of activities other than driving and paying attention to the road. Knowing this begs the question of why is it so much more prevalent and dangerous now than in the past?

For one thing, there are many more vehicles on the roadways these days. Speed limits are faster, attention spans are shorter, and many people use electronic devices while behind the wheel.

Sobering statistics and facts

The National Highway Traffic Safety Administration estimates that as many as 481,000 drivers are using their cell phones while driving during the daytime. The NHTSA reports that distracted driving accidents resulted in the deaths of 3,450 people in 2016. In 2015, approximately 391,000 people suffered injuries in crashes involving a distracted driver. These numbers could actually be higher since it may not always be evident that distracted driving caused an accident.

Would it surprise you to know that teenagers are the most distracted demographic in fatal accidents? Research indicates that drivers from ages 16 to 24 are on their cell phones more often while they drive than any other group. Texting while driving has become one of the most dangerous activities behind the wheel since it requires all of a driver’s attention. It may only take about five seconds to read or send a text, but the landscape of the roadway can change dramatically in that amount of time.

By the time a driver looks up, it could be too late to stop a tragedy, especially for a young driver who lacks the requisite experience to properly respond to an emergency. Any non-driving activity puts you at risk, but texting seems to be one of the worst. Even talking on a cell phone could increase the danger. Smart phones put a great deal of information at your fingertips, but that doesn’t mean you should look at it while driving. Other electronic devices in your vehicle, such as a GPS or infotainment system, also increase the potential for accidents.

What to do

More than likely, you already know to eliminate any distractions that prevent you from focusing on driving and paying attention to your surroundings. Putting down your cell phone helps you stay alive, but not if the driver next to you doesn’t put down his or hers. If you do end up injured by a distracted driver, you may be entitled to pursue compensation for the associated financial losses.