Nationwide Insurance Hit with $8M Bad Faith Judgment
June 23, 2016—A federal judge has ordered Nationwide Mutual Insurance Co. to pay more than $8.1 million in damages after a jury determined that it had acted negligently and in bad faith after denying the claim for the death of an auto accident victim, according to the Daily Report.
Stacey Camacho was killed in 2005 when her Toyota Tercel was struck by a drunk driver, Seung Park. After the accident, Camacho’s husband, Jesus, and mother and executor, LaJean Nichols, sought Park’s policy limit of $100,000 on the grounds that Park would be shielded from any personal liability for any other claims related to the accident “except to the extent that other insurance coverage was available from which the Camacho family could seek additional funds.” Nationwide rejected the offer saying it would only pay if the family supplied a general release under which they would have to repay the insurer if any other claims were made related to medical liens.
No agreement was met, and Nationwide was sued for wrongful death. Camacho and Nichols were awarded $5.85 million, and Park sued Nationwide for negligence and bad faith for failing to settle the claims against him.
The trial was to determine whether Nationwide had acted negligently or in bad faith. Damages were decided later. U.S. District Judge Amy Totenberg's order awarded $5.73 million, what the state court awarded, plus what was at the time of entry $2.4 million in interest.
Slappey & Sadd partners Jay Sadd and Rich Dolder, who represent the plaintiffs along with Darrell Hinson of Swope Rodante, said the judgment could have been avoided if Nationwide had simply agreed to pay its insured's $100,000 policy limit without insisting upon additional conditions.