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Right of Settlement Clause

Allows your insurance company to settle claims made against you

Your insurance company reserves the right of settlement in any claim or lawsuit filed against you.

This means that they can settle as they see fit.

Therefore, if you are in an accident that you do not believe was your fault, but your insurance carrier does, they would be able to settle as they believe is best (even if you disagree).

This of course is not in the best interest of the insurance company, and they have an affirmative duty to believe you.

This is controversial because many times insureds believe they are not at fault. However, the damages do not support their version of events (e.g. he hit me on my right, but there is only damage to left side).

Oftentimes, insureds do not know the rules of the road and they will argue their non-responsibility based on those rules.

Always check the rules of the road in your state before you give a recorded statement.

It takes a good investigation before the insurance carriers will go against the wishes of their insured (bad faith).

They usually only make this decision if they have independent witnesses or a police report that is clear about their insured’s responsibility for all damages.

Click below for an explanation of insurance coverages and terms:

Coverages and Terms Overview

Automobile Liability Insurance or Liability Page 1
Automobile Liability Insurance or Liability Page 2

Automobile Medical Payments or Personal Injury Protection (PIP) Page 1
Automobile Medical Payments or Personal Injury Protection (PIP) Page 2

Collision Coverage (Protection Against Loss to the Auto) Page 1
Collision Coverage (Protection Against Loss to the Auto) Page 2

Comprehensive Coverage (Protection Against Loss to the Auto) Page 1
Comprehensive Coverage (Protection Against Loss to the Auto) Page 2

Under or Uninsured Motorist Property Damage (UMPD) Page 1
Under or Uninsured Motorist Property Damage (UMPD) Page 2

Under or Uninsured Motorist Bodily Injury (UMBI)

Rental Reimbursement or Loss of Use Coverage Page 1
Rental Reimbursement or Loss of Use Coverage Page 2

Restoration Coverage

Towing and/or Road Assistance Coverage (Emergency Packages)

Insurance Clauses and Terms

Overview
Actual Cash Value or ACV
Additional Insurance Clause
Cancellation of Coverage Clause
Choice of Law Clause
Forum Selection Clause

Duty to Cooperate Clause
Duty to Report Losses Clause
Financial Responsibility Clause
Insurable Interest Concept
Interpretation of the Policy Concept

Mandatory Arbitration Clause
Mitigation of Damages Clause
Non Duplication of Benefits Clause
Proof of Loss Clause
Promissory Estoppel Concept

Reservation of Rights Concept
Reasonable and Necessary Clause
Right of Appraisal Clause
Right of Settlement Clause
Rights of Counsel Concept

Subrogation of Rights Clause Part I
Subrogation of Rights Clause Part II
Statute of Limitations Concept
Replacement Cost Value
Restoration Coverage
Transfer of Benefits Clause

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