State legislatures require a driver to show proof of financial Responsibility.
This is automobile insurance or its legal equivalent.
One may post bond/pay fee to drive without insurance.
The financial responsibility is designed to cover the legal and resulting financial liabilities that result from a tort claim.
Some states have no-fault liability insurance. We don’t cover this because it is limited in application. Many states are moving away from this, and the few states that have it are mainly Northeastern, liberal states because it’s a creation of academic thought in an effort to produce judicial efficiency, but it’s more of a hassle than a blessing.
Types of Automobile Insurance:
1.) THIRD PARTY (Liability): BI (bodily injury)/PD (property damage).
SC has minimum limits of 25k/50k/25kàperson/group of persons/property
Combined single limits policies of a minimum of 75k are available.
§ 38-77-140. Bodily injury and property damage limits; general requirements.(A) An automobile insurance policy may not be issued or delivered in this State to the owner of a motor vehicle or may not be issued or delivered by an insurer licensed in this State upon a motor vehicle then principally garaged or principally used in this State, unless it contains a provision insuring the persons defined as insured against loss from the liability imposed by law for damages arising out of the ownership, maintenance, or use of these motor vehicles within the United States or Canada, subject to limits exclusive of interest and costs, with respect to each motor vehicle, as follows:
(1) twenty-five thousand dollars because of bodily injury to one person in any one accident and, subject to the limit for one person;
(2) fifty thousand dollars because of bodily injury to two or more persons in any one accident; and
(3) twenty-five thousand dollars because of injury to or destruction of property of others in any one accident.
(B) Nothing in this article prevents an insurer from issuing, selling, or delivering a policy providing liability coverage in excess of these requirements.
2.) UNINSURED MOTORIST (UM): every policy issued in SC is required to have coverage to product the insured against uninsured motorists that would be liable in tort (SC 38-77-150)
This includes the illegally uninsured, legally uninsured (required to pay to you if financially possible, but most often times they are not), coverage which an insurer successfully denies (this most often arises when the liable drive is deemed to be non-permissive; example: guest passenger cases where one lacks permission (i.e. stolen car, etc.)), phantom hit & run, insolvent insurer, automobiles with less than the minimum limits (less than 25/50/25; you recover at the insured’s limits and then your UM kicks in, which is what happens when you are dealing with the provisions of an out of state policy).
§ 38-77-150. Uninsured motorist provision; defense of action by insurer; subrogation and assignment of benefits.
(A) No automobile insurance policy or contract may be issued or delivered unless it contains a provision by endorsement or otherwise, herein referred to as the uninsured motorist provision, undertaking to pay the insured all sums which he is legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle, within limits which may be no less than the requirements of Section 38-77-140. The uninsured motorist provision must also provide for no less than ten thousand dollars’ coverage for injury to or destruction of the property of the insured in any one accident but may provide an exclusion of the first two hundred dollars of the loss or damage. The director or his designee may prescribe the form to be used in providing uninsured motorist coverage and when prescribed and promulgated no other form may be used.
(B) No action may be brought under the uninsured motorist provision unless copies of the pleadings in the action establishing liability are served in the manner provided by law upon the insurer writing the uninsured motorist provision. The insurer has the right to appear and defend in the name of the uninsured motorist in any action which may affect its liability and has thirty days after service of process on it in which to appear. The evidence of service upon the insurer may not be made a part of the record.(C) Benefits paid pursuant to this section are subject to subrogation and assignment if an uninsured motorist has selected the option to be uninsured by paying the fee pursuant to Section 56-10-510.
3.) FIRST PARTY continued: Insurers are required to offer UM up to liability limits.
§ 38-77-160. Additional uninsured motorist coverage; underinsured motorist coverage.Automobile insurance carriers shall offer, at the option of the insured, uninsured motorist coverage up to the limits of the insured’s liability coverage in addition to the mandatory coverage prescribed by Section 38-77-150. Such carriers shall also offer, at the option of the insured, underinsured motorist coverage up to the limits of the insured liability coverage to provide coverage in the event that damages are sustained in excess of the liability limits carried by an at-fault insured or underinsured motorist or in excess of any damages cap or limitation imposed by statute. If, however, an insured or named insured is protected by uninsured or underinsured motorist coverage in excess of the basic limits, the policy shall provide that the insured or named insured is protected only to the extent of the coverage he has on the vehicle involved in the accident. If none of the insured’s or named insured’s vehicles is involved in the accident, coverage is available only to the extent of coverage on any one of the vehicles with the excess or underinsured coverage. Benefits paid pursuant to this section are not subject to subrogation and assignment.
No action may be brought under the underinsured motorist provision unless copies of the pleadings in the action establishing liability are served in the manner provided by law upon the insurer writing the underinsured motorist provision. The insurer has the right to appear and defend in the name of the underinsured motorist in any action which may affect its liability and has thirty days after service of process on it in which to appear. The evidence of service upon the insurer may not be made a part of the record. In the event the automobile insurance insurer for the putative at-fault insured chooses to settle in part the claims against its insured by payment of its applicable liability limits on behalf of its insured, the underinsured motorist insurer may assume control of the defense of action for its own benefit. No underinsured motorist policy may contain a clause requiring the insurer’s consent to settlement with the at-fault party.
4.) FIRST PARTY UNDER INSURED MOTORIST (UIM): SC requires this through 38-77-160 & 38-77-30(15). SC law requires the insurer to offer the insured up to his policy limits when offering UIM. There are two tests for applying UIM:
(1.) Limits-to-Damages (38-77-160): When damages exceed the limits of the liable driver (which means you have recovered his liability), you can recover under UIM. SC was the first state to adopt this.
Example: Damages came to 200k. At-Fault Driver (AFD) had 25/50 and you had 100/300 in UIM, you’d get the 25k from AFD and then your UIM kicks in 100k. Thus, you get 125k, which is 25k more than you would get under limits-to-limits.
(2.) Limits-to-Limits: You compare limits of AFD and your UIM. You subtract the AFD’s limits from your UIM limits to determine the amount that your UIM pays. This was exemplified by Garris & Gambrell. The logic is that one gets the benefit of the bargain (i.e. you paid for 100k in UIM, and you’re not going to recover more than that).
§ 38-77-30. Definitions.
15) “Underinsured mot
ury or property damage to the insured is unknown, there is no right of action or recovery under the uninsured motorist provision, unless:
(1) the insured or someone in his behalf has reported the accident to some appropriate police authority within a reasonable time, under all the circumstances, after its occurrence;
(2) the injury or damage was caused by physical contact with the unknown vehicle, or the accident must have been witnessed by someone other than the owner or operator of the insured vehicle; provided however, the witness must sign an affidavit attesting to the truth of the facts of the accident contained in the affidavit;
(3) the insured was not negligent in failing to determine the identity of the other vehicle and the driver of the other vehicle at the time of the accident.
The following statement must be prominently displayed on the face of the affidavit provided in subitem (2) above: A FALSE STATEMENT CONCERNING THE FACTS CONTAINED IN THIS AFFIDAVIT MAY SUBJECT THE PERSON MAKING THE FALSE STATEMENT TO CRIMINAL PENALTIES AS PROVIDED BY LAW.
Arising Out of the Use, Maintenance & Ownership of the Covered Vehicle (33-77-140):
1.) There must be a casual connection between the vehicle and the injury;
The vehicle must be an active accessory (ex: running over someone). This test is less than proximate cause but more than mere situs (location) of accident;
The action must be foreseeably identifiable with normal use.
2.) There cannot be an act of independent significance that breaks the chain of causation; AND
3.) The vehicle was being used for transportation at the time of the accident.
This deals with who is covered in liability policies—“bringing many together as a single unit.”—determines WHO is insured by the policy (38-77-30(7)) as opposed to the specific designation of “insured” in a policy.
Two Types of Insured Classes:
1.) Class 1: This includes the named insured, resident spouse, resident relative of either “resident” defined by evidence viewed under a “common sense” rule.
2.) Class 2: This is a permissive driver and guests within the vehicle.
“Insured” means the named insured and, while resident of the same household, the spouse of any named insured and relatives of either, while in a motor vehicle or otherwise, and any person who uses with the consent, expressed or implied, of the named insured the motor vehicle to which the policy applies and a guest in the motor vehicle to which the policy applies or the personal representative of any of the above.
Class 2 Permissive Drivers are those who have express or implied permission to operate the insured vehicle. The scope of permission is determined by the facts, and the party seeking to establish permission has the burden of proof.
Does deviation from the scope of permission defeat coverage (this is a developing body of law)?
 Professor Jedziniak said that contingency fees were banned, but the SC Rules of Professional Conduct and relevant Ethics Advisory Opinions do not read this way. Does anyone have the ability to clarify this? As a person who hopes to be a plaintiff’s attorney, this is of grave concern… -GEB, II