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BICYCLES AND THE LAW

by Ray Thomas
Ray Thomas is a Portland bike lawyer.

BICYCLE ACCIDENTS AND INSURANCE

All too often, serious accidents are caused by drivers without insurance coverage. Oregon law makes it illegal to drive without insurance. If you are injured by a driver without insurance, you may have coverage on your bicycle from your automobile insurance policy. There are two types of important insurance coverage contained in every Oregon automobile insurance policy; many riders do not know that they have been paying for these types of insurance for years. There are also rules that the insurance companies must follow in communicating with citizens; knowing these rules may help you in your next encounter with the insurance system.

Personal Injury Protection

Every Oregon motorist's insurance policy contains Personal Injury Protection (also known as "PIP"). PIP provides certain minimum coverages and can be "stacked," meaning that when more than one policy is applicable the benefits accumulate for the benefit of the claimant. The Oregon Revised Statutes (ORS) contain certain statutory minimums for PIP coverage which include up to $15,000.00 for medical expenses and one year of wage loss up to $1,250 per month. PIP is "no-fault, " in that an injured party may make a claim against the policy regardless of who was at fault in the accident.

Uninsured and Underinsured Motorist Coverage

The second type is uninsured (UM) or underinsured (UIM) motorist coverage, providing all sums the injured person "shall be legally entitled to recover as damages for bodily injury or death." (ORS 742.500) UM or UIM coverage provides coverage as if the uninsured driver had a liability insurance policy. The injured person makes a claim against his or her own insurance policy for their damages. In the case of a serious accident caused by an uninsured driver/underinsured driver, UM or UIM coverage is the best protection for an injured rider. While the Oregon statutory minimum is $25,000.00, with today's high medical costs it is advisable to have at least four times that amount. As with most insurance purchases, the higher ranges of insurance coverage provide more insurance for fewer dollars above the statutory minimum, so higher limit policies are usually a very good deal for the dollar. UM and UIM coverage applies to bicyclists, so long as an accident is the fault of the uninsured or underinsured driver.

The legal relationship between the various types of coverage in a serious accident is quite complex. In some instances, coverage may be denied or limited depending upon policy language and benefit amounts. Seek professional assistance from a lawyer knowledgeable about insurance claims before you accept any representations about whether an accident is covered by a particular insurance policy.

Frequently, serious accidents are caused by uninsured or underinsured drivers. Even if an accident is caused by the bicyclist, PIP coverage (which is no-fault) will apply to provide some benefits. Bicyclists would be well advised to purchase UM or UIM policies with high policy limits to protect themselves from major injuries caused by financially irresponsible drivers.

Insurance Company Rules and Regulations

Oregon law provides that insurance representatives are prohibited from committing "unfair settlement practices." The following collection of provisions are contained part of Oregon law:

(1) No insurer or other person shall commit or perform any of the following unfair claim settlement practices:

(a) Misrepresenting facts or policy provisions in settling claims;
(b) Failing to acknowledge and act promptly upon communications relating to claims;
(c) Failing to adopt and implement reasonable standards for the prompt investigation of claims;
(d) Refusing to pay claims without conducting a reasonable investigation based on all available information;
(e) Failing to affirm or deny coverage of claims within a reasonable time after completed proof of loss statements have been submitted;
(f) Not attempting, in good faith, to promptly and equitably settle claims in which liability has become reasonably clear;
(g) Compelling claimants to initiate litigation to recover amounts due by offering substantially less than amounts ultimately recovered in actions brought by such claimants;
(h) Attempting to settle claims for less than the amount to which a reasonable person would believe a reasonable person was entitled after referring to written or printed advertising material accompanying or made part of an application;


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(k) Delaying investigation or payment of claims by requiring a claimant or the physician of the claimant to submit a preliminary claim report and then requiring subsequent submission of loss forms when both require essentially the same information;
(L) Failing to promptly settle claims under one coverage of a policy where liability has become reasonably clear in order to influence settlements under other coverages of the policy; or
(m) Failing to promptly provide the proper explanation of the basis relied on in the insurance policy in relation to the facts or applicable law for the denial of a claim.
(2) No insurer shall refuse, without just cause, to pay or settle claims arising under coverages provided by its policies with such frequency as to indicate a general business practice in this state, which general business practice is evidenced by:
(a) A substantial increase in the number of complaints against the insurer received by the Department of Consumer and Business Services;
(b) A substantial increase in the number of lawsuits filed against the insurer or its insureds by claimants; or
(c) Other relevant evidence."

Oregon Administrative Rule (OAR) 836-080-0220 also prohibits misrepresentation:

"An insurer shall not:

(1) Fail to fully disclose to a first party claimant all pertinent benefits, coverages and other provisions of an insurance policy under which the claim is asserted.
(2) Conceal from a first party claimant any insurance policy benefits, coverages or other provisions that are pertinent to the claim.
(3) Deny a claim on the grounds of the claimant's failure to exhibit the relevant property without proof of the insurer's demand and the claimant's unfounded refusal.
(4) Except where there is such time limit specified in the policy, make statements, written or otherwise, that require a claimant to give written notice of loss or proof of loss within a specified time and that seek to relieve the insurer of its obligations if the time limit is not complied with, unless the failure to comply with the specified time limit prejudices the insurer's rights.
(5) Request a first party claimant to sign a release that extends beyond the subject matter that gave rise to the claim payment.
(6) Issue checks or drafts in partial settlement of a loss or claim under a specific policy coverage that contain language releasing the insurer or its insured from its total liability."

The law also prohibits delay longer than 30 days in response to correspondence and 45 days in regard to notification of a claim:

"(1) Not later than the 30th day after receipt of notification of claim, acknowledge the notification or pay the claim. An appropriate and dated notation of the acknowledgment shall be included in the insurer's claim file.


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(3) Make an appropriate reply, not later than the 30th day after receipt, to all other pertinent communications about a claim from a claimant that reasonably indicate a response is expected.
(4) Upon receiving notification of claim from a first party claimant, promptly provide necessary claim forms, instructions and assistance that is reasonable in the light of the information possessed by the insurer, so that the claimant can comply with the policy conditions and the insurer's reasonable requirements. Compliance with this section not later than the 30th day after receipt of notification of a claim constitutes compliance with section (1) of this rule."

"An insurer shall complete its claim investigation not later than the 45th day after its receipt of notification of claim, unless the investigation cannot reasonably be completed within that time. "

As the statute notes, insurance companies are monitored by the numbers of complaints associated with the way they handle property and personal injury claims. ORS 746.230(2) tracks the number of complaints received by the Oregon Department of Consumer and Business Services. It is important to file a claim each and every time if you have a complaint about the behavior of an insurance representative so that the instance is noted and investigated. The claim form for an insurance claim is located on-line at www.cbs.state.or.us/ins/forms. You can also telephone a complaint to the Oregon Insurance Commissioner by calling the following phone number (503) 947-7980.

Knowledge of Oregon insurance system benefits and operating rules is necessary for property and personal injury claims. While you may be more vulnerable on your bicycle than someone encased in sheet metal and glass in an automobile, you have the same important legal rights and deserve fair treatment.