In a case handed down by the Massachusetts Appeals Court recently, the Court held that AIG did violate the unfair settlement act of Massachusetts. In every case in which an insurance company is involved, the law in Massachusetts says that the insurance company must effectuate a prompt, fair and equitable settlement once liability becomes clear. In motor vehicle accidents, insurance companies have fairly simple protocols to determine liability. In this case, where an 18 wheeler truck collided with the rear end the plaintiff’s vehicle, even the insurance company admitted their insured was at fault.
In this case, there was a horrific collision in which the plaintiff, Marcia Rhodes, was instantly and permanently paralyzed as a result of the trauma. Her attorneys prepared a settlement package for the insurance companies. Unfortunately, what happened was that the insurance companies hired a company to investigate, then went through staffing changes, and then used their bureaucracy to o delay responding to Rhodes’ settlement demand. They also hired and rehired counsel to delay things further.