Obligation for Auto Insurers to Provide Policy Coverage Information Before the Filing of a Lawsuit
Last week, the Delaware Superior Court confirmed that auto insurance providers are obligated to provide documentation of applicable motor vehicle policy limits to those injured in automobile accidents, before the injured party files a lawsuit.[1] Therefore, under 21 Del. C. § 2907, despite no express statement in the code’s language, an implied right of action exists against insurance companies who fail to provide the relevant policy documentation after a motor vehicle accident.[2]
This decision was a matter of first impression for the Court, meaning whether a private right of action exists under Section 2907 had not previously been ruled on in Delaware. In making the determination that an implied right of action does exist under Section 2907, the Court reviewed the history and implementation of Delaware’s motor vehicle laws.
Delaware’s Motor Vehicle Financial Responsibility Act was established to protect and compensate people injured in automobile accidents.[3] Section 2907 was drafted in accordance with the Motor Vehicle Financial Responsibility Act, and follows the legislature’s desire to reduce the volume of lawsuits filed with the court by effectively communicating coverage information to injured individuals.[4] Before the implementation of Section 2907, auto insurers were not obligated to disclose policy limits, and thus providers were only legally required to provide policy coverage information after an injured party filed a lawsuit against a tortfeasor (the party allegedly at fault in the auto accident).
Now, upon receiving a valid written request from a person injured in a motor vehicle accident, Section 2907 obligates auto insurers to provide the applicable motor vehicle policy limits if the “total of the medical bills and wage losses submitted equals or exceeds $12,500.”[5] Written requests from the injured individual must comply with the statutory requirements under Section 2907 (b) and (c), which require providing necessary details such as the date of the accident, names and addresses of the involved parties, and if available, claim numbers, police reports, medical records, medical bills, lost wages documentation, etc.[6]
By requiring the disclosure of liability coverage prior to the filing of any lawsuit, individuals can obtain policy coverage information without court involvement. Not only does this obligation on auto insurers lessen the burden on the judicial system, but it provides benefits for individuals to potentially settle their claims pre-suit, thereby avoiding court filing fees and expediting the recovery for their medical expenses and lost wages.
Without this implied right under Section 2907, individuals have no other option to obtain policy documentation aside from filing a lawsuit against the tortfeasor, which is the exact recourse the legislature aimed to avoid by passing Section 2907.[7] Holding auto insurers accountable if they fail to provide policy information in response to a formal request, promotes the policy rationales behind enacting Section 2907 and ensures providers comply with the statutory requirements.
[1] Thompson v. Lewis, No. N23C-08-039 PAW, 2024 WL 4357792, (Del. Super. Ct. Sept. 30, 2024).
[2] Id.; 21 Del. C. § 2907 (2023).
[3] H.B. 413, 149th Gen. Assemb., Reg. Sess. (Del. 2018); Hudson v. State Farm, 569 A.2d 1168, 1172 (Del. Super. Jan. 18, 1990).
[4] H.B. 413, 149th Gen. Assemb., Reg. Sess. (Del. 2018); Thompson v. Lewis, No. N23C-08-039 PAW, 2024 WL 4357792, (Del. Super. Ct. Sept. 30, 2024).
[5] The obligation is only triggered if the injured party’s total medical bills and wage losses are equal to or exceed $12,500. 21 Del. C. § 2907(d).
[6] 21 Del. C. §§ 2907(b) and (c).
[7] Thompson v. Lewis, No. N23C-08-039 PAW, 2024 WL 4357792, (Del. Super. Ct. Sept. 30, 2024).
