Close
Updated:

North Carolina Appellate Court Approves Arbitration Award in Underinsured Motorist Accident Claim but Reverses Judgment Providing Pre-Award Interest

One of the most challenging aspects of a car accident is dealing with insurance companies. Whether you are having trouble getting your own insurance company to provide you with coverage, or you are having issues working with the at-fault party’s insurance company, a seasoned North Carolina car accident lawyer can make all of the difference when it comes to asserting your rights. In a recent appellate decision, the court considered the suitability of an arbitration award entered in a car accident victim’s favor against an insurance company. The plaintiff and the defendant were involved in an accident in 2013. At the time, the plaintiff had underinsured motorist coverage through Farm Bureau. The policy obligated the insurer to pay compensation to the plaintiff if the plaintiff was involved in a crash with a driver whose coverage limits were too low to cover the amount of damages that the plaintiff suffered.

After the accident, the plaintiff entered into a settlement with the defendant’s insurance company. Farm Bureau provided a check to the plaintiff totaling $35,000, which included coverage for different items. The plaintiff rejected this offer, however, since the parties had a dispute regarding the amount that the plaintiff was entitled to recover under the policy. The plaintiff demanded an arbitration before a three-member panel. It unanimously concluded that the plaintiff was entitled to $110,000. The award stated that the arbitrators did not consider costs or interest in reaching this amount. The plaintiff then filed a motion with the court, seeking confirmation of the arbitration award and requesting interest and costs, which the court awarded.

Farm Bureau appealed, stating that the court committed an error when it awarded costs to the plaintiff, including pre-award interest and post-award interest when it confirmed the arbitration award. The insurer did not dispute the $110,000 determination. Ultimately, the court affirmed the lower court’s award of post-award and pre-judgment interest, but it reversed the award of pre-award interest and costs. According to the appellate court, pre-award interest is categorized as included in a compensatory damages item for which the underinsured motorist may be liable unless the policy provides for an exclusion on this topic. As a result, the arbitrators have the authority to decide whether pre-award interest should be included as part of the compensatory damages. It is not appropriate for the trial court to make this decision. If the arbitrators do not include pre-award interest, the trial court must affirm the arbitration award as written unless the arbitrators expressly defer the determination to the trial court.

If you were hurt in a car accident, you may be entitled to compensation from the party who caused the accident to take place. At Maurer Law, our reliable team of car accident lawyers has provided knowledgeable legal guidance to accident victims and their families throughout North Carolina. Whether you simply have questions about your rights or you are ready to proceed, we offer a free consultation to discuss your situation. Call us now at 1-888-258-1087 or contact us online to set up your appointment before time runs out on your claim.

Related Posts:

North Carolina Workers’ Compensation Board Upholds Decision Authorizing Insurer to Request Change in Medical Treatment Plan for Injured Worker

North Carolina Workers’ Compensation Commission Orders Credit in Favor of Insurer in Scaffolding Accident

Contact Us