Punitive damages are awarded to a plaintiff in the event that the court deems the actions of the defendant to have been highly dangerous. If these are decided to have been of a violent nature, the court has the authority to award punitive damages, which the defendant must pay. These damages are not meant to cover the losses suffered by the victim, but rather to punish the defendant. So, what is punitive damages? Are they just a sort of punishment that the court inflicts on the defendants? What is the role of insurance companies when it comes to paying the punitive damages? These are the questions we need answers to, and those are briefly explained below.
What is punitive damages?
The details mentioned above will surely give you an idea regarding punitive damages. These damages are intended as a punishment, and also to serve as a warning to others who are preparing to engage in activities that are deemed dangerous to the general public.
Liability insurance policy
If a negligent action from your part was to cause an accident resulting in the injury of another person, then with the help of a liability insurance policy, you will be able to cover the costs incurred in such a situation. It should be noted that, the insurance company is needed to pay off the damages only if the injury to the victim happened as a result of a negligent action. If the insurance company finds out that the incident was intentional, then they are not liable to pay for your damages. The company is also liable to pay for any legal costs, if any, in the event of an accident.
Cover for punitive damages
Whether the insurance policy covers the punitive damages or not will depend on the state in which you have applied for the insurance cover. In most states, the insurance policy does not cover for the punitive damages and if you are to pay off any punitive damages, you will not be able to depend on the insurance policy.
Punitive damages are usually awarded in cases where the defendant is found guilty of driving under the influence, or in a hit and run case. In such cases, the defendant might have to pay off the punitive damages personally.
These are some of the details regarding punitive damages and insurance policies. While insurance policies will help in paying off damages, in situations where you have to pay punitive damages, they might not be of help.Google+