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Automobile insurance is an important aspect of life which most people do not pay much attention to until they are in a collision. Unfortunately, when a collision occurs some people may find that their insurance coverage is inadequate and that their insurance company will not defend them throughout the litigation which may ensue.
A recent Wisconsin Court of Appeals decision, Young v. Welytok, 2009AP3015, has reexamined what are known as "pay and walk" provisions which are sometimes found in insurance policies. A "pay and walk" provision is a portion of a policy which states that the insurance company may elect to pay the maximum liability limit of a policy and remove itself from litigation.
In Young v. Welytok, Young was riding a motorcycle and was injured in a collision with the Welytoks' minor daughter. Young initiated a lawsuit against the Welytoks and their insurance company, American Standard. After considering the cost of a trial, American Standard offered to settle with Young for $100,000 (the maximum liability limit of the Welytoks' insurance policy). The only problem with American Standard's offer was that Young was seeking more than $100,000. After American Standard paid Young the $100,000 and sought to remove itself from further litigation the Welytoks cried foul.
In Young v. Welytok, the Appeals Court found that the Welytoks' insurance policy did indeed include a valid "pay and walk" provision. Further, the provision was bold and capitalized, drawing attention to itself. Because American Standard paid out the policy limit, the Welytoks were on their own in regard to any further litigation and damages.
* Please note that this is general information only and not intended to be legal advice. If you have questions or need legal advice please setup an appointment with our attorney, or an attorney of your choosing.
Russell is an attorney with Nicolet Law Accident & Injury Lawyers. Russell represents injured clients in Hudson, New Richmond, River Falls, Prescott, Ellsworth, Roberts, Osceola, St. Croix Falls, Menomonie, Eau Claire, Chippewa Falls and surrounding areas of Wisconsin.