Can You Sue an Insurance Company After a Settlement?
Can you sue an insurance company after a settlement? Usually, you cannot reopen the same claim after you sign a valid settlement agreement and release. However, in limited situations, you may still be able to take additional legal action. It depends on what you settled, which parties you released, and the exact language of the agreement.
At Foster Wallace Personal Injury Lawyers, we have years of experience representing injured people throughout Kansas City. If you already signed a settlement or received an offer, an attorney can review the agreement and explain what claims it covers. Here’s what you need to know about your rights after you sign a settlement.
What Happens to Your Right to Sue After a Settlement?
Most personal injury settlements require you to sign a release of claims. This means you receive the agreed settlement in exchange for giving up specified legal claims against specified parties.
Once you sign a valid release, reopening the same released claim is generally difficult. Receiving the settlement check is often one of the final stages of the process.
A release may identify:
- The people or businesses you release from liability
- The claims included in the settlement
- Whether the release covers known and unknown injuries
- Whether it resolves property damage, bodily injury, or both
- Other rights or claims affected by the agreement
When Can You Still Sue After a Settlement?
So, when can you sue an insurance company after a settlement? Legal action may still be possible in the following situations.
The Settlement or Release Was Obtained Through Fraud, Duress, or Misrepresentation
You may be able to challenge a settlement if it was obtained through significant fraud, coercion, or misrepresentation.
This differs from challenging a release simply because you regret the settlement amount. Challenges to a signed release depend heavily on the facts surrounding the agreement.
The Settlement Did Not Cover the Claim You Want to Pursue
Not every settlement covers every loss from an accident.
For example, you might settle a vehicle property damage claim without resolving your bodily injury claim. Whether you still have an injury claim depends on the agreement you signed. Review the release rather than assuming the settlement check ended every claim.
If you are unsure how different types of coverage apply after a crash, review whether car insurance covers personal injury.
You Have a Claim Against a Different Party
Some accidents involve more than one potentially responsible party. For example, a multi-vehicle crash could involve two drivers, or a commercial crash could raise questions about both a driver and an employer.
Settling with one party doesn’t necessarily resolve a claim against another party. However, the language of the release controls what rights you gave up, so do not pursue another claim based on that assumption alone.
If another claim may exist, have an attorney review the settlement agreement first.
What If You Want to Sue the Insurance Company Itself?
Suing an insurance company is different from trying to reopen a claim against the person who caused your injuries. In some situations, a separate dispute may involve your own insurance company, even after you settle the underlying claim.
Whether you have another claim depends on your policy, how the insurer handled the claim, and the terms of any settlement or release you signed.
Bad Faith or Unfair Handling by Your Own Insurer
A disagreement with your own insurer does not automatically give you grounds for a lawsuit. However, separate legal issues may arise when an insurer wrongfully denies a covered claim, refuses to pay benefits owed under a policy, or violates applicable insurance law.
Missouri and Kansas have different laws governing insurance practices and disputes. An attorney should review the policy, communicate with the insurer, and review the settlement documents before determining whether a separate claim exists.
Underinsured Motorist Claims After a Settlement
If the at-fault driver doesn’t have enough insurance to cover your losses, your own underinsured motorist (UIM) coverage may come into play.
Settling with the at-fault driver’s insurer does not necessarily eliminate a potential UIM claim. However, your insurance policy and applicable notice, consent, and other requirements may affect your ability to pursue additional coverage.
Before accepting a settlement when your losses exceed the other driver’s available insurance, review your policy and speak with your insurer and a Kansas City car accident lawyer.
What If Your Injuries Get Worse After You Settle?
Discovering that your injuries are worse than expected generally does not undo a settlement release you already signed. A release may cover future or previously unknown damages arising from the accident.
That is why you should understand your medical condition, expected treatment, and potential future losses before accepting a final settlement. Ongoing symptoms or an uncertain prognosis deserve careful consideration before you give up your right to pursue additional compensation.
What Should You Check Before Signing a Settlement?
Before signing a settlement agreement, read the release carefully and make sure you understand what rights you are giving up.
Pay particular attention to:
- Who you are releasing: Does the agreement name only one person or company, or does it extend to additional parties?
- Which claims you are releasing: Determine whether the agreement covers property damage, bodily injury, or both.
- Future or unknown injuries: Check whether the release includes injuries or damages discovered after settlement.
- Other potentially responsible parties: Consider whether someone besides the party offering the settlement may share responsibility.
- Other available insurance: Determine whether UIM or another source of coverage may apply.
What If You Already Signed the Settlement?
If you already signed, start by getting a complete copy of the settlement agreement and release. An attorney can review exactly which claims and parties the agreement covers and whether another claim remains or a legal basis exists to challenge the agreement.
Prompt review matters because a separate, unreleased claim may have its own filing deadline.
If you already signed a release—or received a settlement offer and have not signed yet—contact Foster Wallace Personal Injury Lawyers. Our attorneys provide direct, personalized attention, review the documents with you, and discuss your options.