Insurance Complications in Deadly Nursing Home Fire Case
Sometimes defendants--or possible defendants--in various legal cases are referred to as “judgement proof.” This does not mean that their fault in an accident cannot be proven. Instead it means that the defendant has no way to pay for any liability anyway, and so spending the time and significant expenses to pursue the case is usually moot. It makes no sense to spend resources securing a judgment that one will never be able to collect on anyway.
Obviously judgment proof defendants can be a significant problem, because they usually lack the incentive to act properly in all cases to prevent negligence which causes accidents. To combat this, in different setting people are required to have insurance. The most obvious example of this is car drivers. Recognizing the high risk of accidents and the need for those responsible to pay for the consequences of their actions, drivers are required to have insurance, essentially to guarantee that they are not judgement proof.
Insurance & Nursing Home Neglect
Many have made calls for the same steps to be taken with regard to nursing home care. If a facility does not have any liability insurance, then it is usually impossible for them to pay for the consequences of potential negligence that harms patients. This often results in facilities avoiding judgement and operating with less care. Injured residents and their families see no recourse. Legislation has been proposed in Illinois to change this and require Illinois nursing homes to carry liability insurance. However, thus far the nursing home lobby has been strong enough to defeat the bill
Making matters even more complicated, even homes that have insurance are grossly underinsured, making it very difficult to secure full recovery in even the most tragic cases. This was illustrated in developments in a tragic case stemming from a nursing home fire.
A tragic fire struck a nursing home in 2003 that took the lives of 16 residents. Those families filed a nursing home neglect and wrongful death lawsuit seeking accountability for various actions on the facility’s part which led to the fire and subsequent deaths. The arguments explained that the facility was negligent in failing to supervise a resident who set her bed on fire while playing with a cigarette lighter.
Since the tragedy ten years ago, the legal battle has centered on the nursing homes insurance policy. The families disputed the insurance company’s claim regarding the total coverage under the facility’s policy. In a troubling decision, the state’s Supreme Court ruled recently that the coverage was only for $1 million total, instead of the $10 million total that a lower court had decided.
The disagreement was on whether the $10 million total applied to the single facility in question or was split between seven different nursing homes run by the same operator and insured by the same company. This ruling likely means that families will receive 7-10 times less than they otherwise would. It is a sad reminder that even in cases of immense tragedy like this, those involved in the matter--particularly insurance companies--may use all lengths at their disposal to deny compensation to those hurt.
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