UM/UIM Demand Letter - Rhode Island

UM/UIM (UNINSURED/UNDERINSURED MOTORIST) DEMAND LETTER

State of Rhode Island

[LAW FIRM LETTERHEAD]

PRIVILEGED AND CONFIDENTIAL
SETTLEMENT COMMUNICATION — FOR RESOLUTION PURPOSES ONLY
PROTECTED UNDER R.I. R. EVID. 408 AND F.R.E. 408

VIA CERTIFIED MAIL, RETURN RECEIPT REQUESTED
AND VIA EMAIL TO: [________________________________]

Date: [__/__/____]

[INSURANCE COMPANY NAME]
[________________________________]
[________________________________]
[________________________________], RI [________]

Attention: [________________________________], [________________________________]
Re: UM/UIM POLICY LIMITS DEMAND — RHODE ISLAND
Insured/Claimant: [________________________________]
Policy Number: [________________________________]
Claim Number: [________________________________]
Date of Loss: [__/__/____]
UM/UIM Policy Limits: $[________________________________]
Tortfeasor: [________________________________]
Tortfeasor's Carrier: [________________________________]
Tortfeasor's Limits: $[________________________________]
Response Deadline: [__/__/____] at 5:00 p.m. ET

Dear [________________________________]:

I. INTRODUCTION AND NATURE OF DEMAND

This firm represents [________________________________] ("our client") in connection with a claim for [uninsured / underinsured] motorist benefits under Rhode Island law arising from a motor vehicle collision on [__/__/____]. This letter constitutes a formal demand for payment of the full UM/UIM policy limits of $[________________________________].

Our client sustained serious injuries in this collision as a direct result of the negligence of [________________________________] (the "tortfeasor"). The tortfeasor's available coverage is wholly inadequate to compensate our client for the losses described herein. Under R.I. Gen. Laws § 27-7-2.1, UM/UIM coverage exists precisely for this purpose — to protect your insured when the negligent party carries no insurance or insufficient insurance.

This demand expires at 5:00 p.m. Eastern Time on [__/__/____]. Failure to accept this demand within the stated period will result in arbitration, litigation, a bad faith claim under R.I. Gen. Laws § 9-1-33, and a complaint with the Rhode Island Department of Business Regulation (DBR), Insurance Division.

II. RHODE ISLAND UM/UIM LAW — STATUTORY FRAMEWORK

A. Mandatory UM/UIM Coverage: R.I. Gen. Laws § 27-7-2.1

Rhode Island mandates that every motor vehicle liability policy delivered or issued for delivery in this state include uninsured motorist coverage unless the named insured rejects such coverage in writing. See R.I. Gen. Laws § 27-7-2.1; 230-RICR-20-05-1. The statute defines "uninsured motorist" to include underinsured motorists — defined as owners or operators carrying liability insurance "in an amount less than the limits or damages that persons insured are legally entitled to recover."

The minimum UM/UIM bodily injury limits are $25,000 per person / $50,000 per accident, consistent with Rhode Island's mandatory minimum liability requirements under R.I. Gen. Laws § 31-47-2(13)(i)(A). Unless the insured has obtained higher limits or properly reduced them in writing, this floor applies.

B. Intra-Policy Stacking: R.I. Gen. Laws § 27-7-2.1

Rhode Island expressly permits intra-policy stacking. Where an insured has paid two or more separate premiums for UM/UIM coverage within a single policy or under several policies with the same insurance company, the insured is entitled to collect up to the aggregate amount of coverage for all insured vehicles, regardless of any anti-stacking language in the policy. R.I. Gen. Laws § 27-7-2.1. Any policy provision purporting to limit recovery to a single-vehicle limit is void as contrary to statute.

Stacking Analysis for This Claim:

C. Consent to Settle / Preservation of Rights

Under Rhode Island law and standard policy terms, before settling with the tortfeasor's carrier, the insured must notify the UM/UIM carrier and obtain consent. We hereby provide formal notice of our intent to accept the tortfeasor's policy limits of $[________________________________] from [________________________________]. Please confirm your consent in writing within [____] days. Failure to object within a reasonable time waives any subrogation rights you may assert against the tortfeasor.

D. Pure Comparative Negligence: R.I. Gen. Laws § 9-20-4

Rhode Island follows pure comparative negligence. Our client bears zero comparative fault. Even if some fault were attributed to our client, Rhode Island permits recovery reduced proportionally — there is no bar to recovery unless fault is not established. R.I. Gen. Laws § 9-20-4.

E. Statute of Limitations

The applicable limitations periods are:

• Tort claims (bodily injury): Three (3) years from date of loss. R.I. Gen. Laws § 9-1-14.
• Contract claims (policy benefits): Ten (10) years. R.I. Gen. Laws § 9-1-13.

The date of loss is [__/__/____]. This demand is timely within all applicable periods.

III. COVERAGE ANALYSIS

A. Policy Information

B. Coverage Trigger

For Uninsured Motorist (UM) Claims:

The tortfeasor qualifies as an "uninsured motorist" under R.I. Gen. Laws § 27-7-2.1 because:

☐ The tortfeasor carried no liability insurance at the time of the collision
☐ The tortfeasor's insurer has denied coverage
☐ The tortfeasor's insurer is insolvent
☐ The tortfeasor was a hit-and-run driver who has not been identified
☐ The tortfeasor's limits ($[________________________________]) are below Rhode Island's statutory minimum ($25,000/$50,000)

For Underinsured Motorist (UIM) Claims:

The tortfeasor qualifies as an "underinsured motorist" under R.I. Gen. Laws § 27-7-2.1 because:

☐ The tortfeasor's liability limits of $[________________________________] are insufficient to compensate our client for damages exceeding $[________________________________]
☐ Our client has exhausted / will exhaust the tortfeasor's policy limits of $[________________________________]
☐ Our client's total damages of $[________________________________] exceed all available liability coverage

IV. THE COLLISION AND LIABILITY

A. Facts of the Collision

On [__/__/____], at approximately [____] [a.m./p.m.], our client was [________________________________] at or near [________________________________], [________________________________], Rhode Island.

[Detailed narrative of collision — include road conditions, traffic controls, weather, speeds, directions of travel, and sequence of events:]

[________________________________]

[________________________________]

[________________________________]

B. Tortfeasor's Negligence Under Rhode Island Law

The tortfeasor, [________________________________], was negligent under Rhode Island law in the following respects:

☐ Failure to maintain a proper lookout
☐ Failure to yield the right-of-way
☐ Following too closely (R.I. Gen. Laws § 31-15-11)
☐ Excessive speed for conditions or in violation of posted limits (R.I. Gen. Laws § 31-14-1)
☐ Distracted driving / improper cell phone use (R.I. Gen. Laws § 31-22-11.7)
☐ Running a red light or stop sign (R.I. Gen. Laws § 31-13-4)
☐ Improper lane change (R.I. Gen. Laws § 31-15-6)
☐ Operating under the influence of alcohol or drugs (R.I. Gen. Laws § 31-27-2)
☐ Failure to use turn signal (R.I. Gen. Laws § 31-16-5)
☐ [________________________________]

C. Evidence of Liability

1. Police / Traffic Crash Report
[________________________________] Police Department / Rhode Island State Police, Traffic Crash Report No. [________________________________], dated [__/__/____]. The report [☐ cites the tortfeasor / ☐ notes no citation was issued]. [Describe relevant findings:]

[________________________________]

2. Witness Statements
[____] independent witness(es) observed the collision and corroborate our client's account. [Witness names/statements attached / summarize:]

[________________________________]

3. Physical Evidence
Point of impact, vehicle damage patterns, skid marks, debris field, and traffic camera footage [________________________________].

4. Expert Analysis ☐ Applicable
[________________________________] has completed an accident reconstruction concluding: [________________________________]

D. Our Client's Comparative Fault

Under Rhode Island's pure comparative negligence standard (R.I. Gen. Laws § 9-20-4), our client bears no comparative fault for this collision. The evidence uniformly establishes that the tortfeasor was solely responsible.

V. OUR CLIENT'S INJURIES AND MEDICAL TREATMENT

A. Summary of Injuries

As a direct and proximate result of the collision, our client sustained the following injuries:

Primary Diagnosed Injuries:

• [________________________________]
• [________________________________]
• [________________________________]

Secondary / Related Conditions:

• [________________________________]
• [________________________________]

B. Treatment Timeline

C. Current Condition and Prognosis

[________________________________]

[________________________________]

D. Permanent Impairment (if applicable)

VI. DAMAGES

A. Medical Expenses

Past Medical Expenses:

Future Medical Expenses (Present Value):

B. Lost Income

Past Lost Income:

Our client was employed as [________________________________] at [________________________________], earning $[________________________________] per [week/month/year] at the time of the collision. Our client was unable to work from [__/__/____] through [__/__/____], a period of [____] [days/weeks].

Future Lost Earning Capacity (Present Value):

[________________________________]

Future Lost Earning Capacity: $[________________________________]

C. Non-Economic Damages

Under Rhode Island law, our client is entitled to compensation for non-economic losses with no statutory cap on pain and suffering damages:

Pain and Suffering:
[________________________________]

Loss of Enjoyment of Life:
[________________________________]

Emotional Distress:
[________________________________]

Loss of Consortium ☐ Applicable:
[________________________________]

D. Total Damages Summary

VII. UIM OFFSET CALCULATION AND AMOUNT DUE

A. UIM Benefits Calculation

Our client's uncompensated damages of $[________________________________] far exceed the available UIM stacked limits. This is a clear policy limits case. We demand payment of the full stacked UIM limits of $[________________________________].

VIII. BAD FAITH WARNING UNDER R.I. GEN. LAWS § 9-1-33

A. Rhode Island Bad Faith Statute

R.I. Gen. Laws § 9-1-33 authorizes an insured to bring a direct action against an insurer that wrongfully and in bad faith refuses to pay or settle a claim under the policy or refuses to timely perform its contractual obligations. In any such action, the insured may recover:

• Compensatory damages (all policy benefits owed, plus consequential losses)
• Punitive damages — available as a matter of right without requiring proof of willful or wanton conduct beyond the bad faith itself (Skaling v. Aetna Ins. Co., 799 A.2d 997 (R.I. 2002))
• Reasonable attorney's fees (not limited to the American Rule in bad faith actions under § 9-1-33)

B. Elements of Bad Faith (Bibeault / Skaling Standard)

Under Bibeault v. Hanover Ins. Co., 417 A.2d 313 (R.I. 1980), and as reaffirmed in Skaling v. Aetna Ins. Co., 799 A.2d 997 (R.I. 2002), bad faith requires:

1. Absence of a reasonable basis in fact or law for denying or delaying the claim; and
2. The insurer's knowledge of, or reckless disregard of, that lack of reasonable basis.

The insurer must evaluate liability by objective, measurable criteria and must "attempt, in good faith, to resolve the claim so that its insured is relieved from the burden of instituting a suit to recover under the policy." Skaling, 799 A.2d at [____]. An insurer that stonewalls a valid claim to reduce or eliminate just liability exposes itself to the full range of § 9-1-33 remedies.

C. Asermely Rule: Settlement Obligation

Where an excess verdict is foreseeable, Rhode Island insurers must seriously consider reasonable settlement demands within policy limits. Asermely v. Allstate Ins. Co., 728 A.2d 461 (R.I. 1999). Failure to act on a clear policy-limits case exposes [________________________________] to liability beyond policy limits.

D. Statutory Violations: R.I. Gen. Laws § 27-9.1-4

[________________________________] is also required to comply with Rhode Island's Unfair Claims Settlement Practices Act, R.I. Gen. Laws § 27-9.1-4. The Act requires insurers to:

• Acknowledge claims within 10 days of receipt
• Accept or deny coverage within 30 days of proof of loss
• Adopt and implement reasonable standards for prompt investigation
• Attempt in good faith to effectuate prompt, fair, and equitable settlement when liability is reasonably clear
• Refrain from compelling litigation by offering substantially less than amounts owed

Any failure to respond meaningfully to this demand within the stated period will constitute multiple violations of § 27-9.1-4 and will be cited in bad faith litigation under § 9-1-33.

IX. ARBITRATION

A. Policy Arbitration Provision

The applicable policy ☐ contains / ☐ does not contain an arbitration clause for UM/UIM disputes.

Per 230-RICR-20-05-1, any arbitration clause in a Rhode Island UM/UIM policy must be placed immediately before the testimonium clause or signature line. The following arbitration language appears in the policy:

[________________________________]

B. Arbitration Demand

If [________________________________] fails to accept this demand, we hereby provide notice of intent to invoke the arbitration process under the policy and Rhode Island law. Our client reserves all rights to seek arbitration as an alternative to litigation to resolve any disputes regarding the amount of UM/UIM benefits owed.

X. SETTLEMENT DEMAND AND RESPONSE DEADLINE

A. Formal Demand

We hereby demand payment of the full UM/UIM policy limits — including all available stacked limits — of $[________________________________].

This demand is made pursuant to R.I. Gen. Laws § 27-7-2.1 and the terms of the policy. Our client's compensable damages of $[________________________________] substantially exceed the available coverage. Payment of policy limits is the only reasonable response to this claim.

B. Response Deadline

THIS DEMAND EXPIRES AT 5:00 P.M. EASTERN TIME ON [__/__/____].

Please provide written acceptance by that deadline. [________________________________] may contact the undersigned at [________________________________] to discuss settlement or to request an extension for good cause.

C. Consequences of Non-Response

If [________________________________] fails to accept this demand by the deadline:

1. We will invoke arbitration (if required under the policy) or file suit in Rhode Island Superior Court (Providence/Bristol County) for all UM/UIM benefits owed
2. We will pursue a bad faith claim under R.I. Gen. Laws § 9-1-33 seeking compensatory damages, punitive damages, and attorney's fees

3. We will file a formal complaint with:
   - Rhode Island Department of Business Regulation, Insurance Division
   1511 Pontiac Avenue, Cranston, RI 02920
   Telephone: (401) 462-9520 | Email: [email protected]

4. We will seek prejudgment interest pursuant to R.I. Gen. Laws § 9-21-10

XI. CONCLUSION

Our client was seriously injured through no fault of their own by a motorist who lacked adequate coverage. [________________________________] sold our client a policy guaranteeing UM/UIM protection for exactly this circumstance. The coverage is clear, the damages are documented, and the policy limits demanded are reasonable. This is a straightforward policy limits case.

We urge [________________________________] to accept this demand and fulfill its obligations to its own insured under Rhode Island law.

Respectfully submitted,

[________________________________]

By: ___________________________________
[________________________________]
Rhode Island Bar No. [________]
[________________________________]
[________________________________], RI [________]
Tel: [________________________________]
Fax: [________________________________]
Email: [________________________________]

Counsel for [________________________________]

ENCLOSURES:

• Policy declarations page with UM/UIM endorsements
• UM/UIM coverage provisions and stacking analysis
• Police / traffic crash report (Report No. [________________________________])
• Medical records and itemized bills (all providers)
• Wage loss documentation (employer letter, tax records)
• Photographs of scene and vehicles
• Expert reports (if applicable)
• Proof of tortfeasor's policy limits (BI limit verification letter)

CC:

• [________________________________] (Client)
• [________________________________] (Tortfeasor's Carrier — re: consent to settle)

RHODE ISLAND UM/UIM LAW QUICK REFERENCE

SOURCES AND REFERENCES

• R.I. Gen. Laws § 27-7-2.1 (UM/UIM coverage and stacking): https://law.justia.com/codes/rhode-island/title-27/chapter-27-7/section-27-7-2-1/
• R.I. Gen. Laws § 9-1-33 (Bad faith refusal to pay): https://law.justia.com/codes/rhode-island/title-9/chapter-9-1/section-9-1-33/
• R.I. Gen. Laws § 27-9.1-4 (Unfair Claims Settlement Practices): https://law.justia.com/codes/rhode-island/title-27/chapter-27-9-1/section-27-9-1-4/
• R.I. Gen. Laws § 9-20-4 (Comparative negligence): https://law.justia.com/codes/rhode-island/2022/title-9/chapter-9-20/section-9-20-4/
• 230-RICR-20-05-1 (RI DBR UM/UIM Insurance Regulations): https://rules.sos.ri.gov/regulations/part/230-20-05-1
• Bibeault v. Hanover Ins. Co., 417 A.2d 313 (R.I. 1980) (bad faith elements)
• Skaling v. Aetna Ins. Co., 799 A.2d 997 (R.I. 2002) (bad faith; objective standard; punitive damages)
• Asermely v. Allstate Ins. Co., 728 A.2d 461 (R.I. 1999) (settlement within policy limits obligation)
• RI DBR Insurance Division: https://dbr.ri.gov/insurance-overview
• Bottaro Law — RI Stacking Overview: https://bottarolaw.com/blog/ri-personal-injury-lawyer-stacking-ri-insurance-when-the-at-fault-party-does-not-have-enough-insurance/