Denver Jury Awards $3 Million After Insurer Refused to Pay Crash Victim Any Benefits

On the morning of October 25, 2013, Alex Headley was driving northbound on Interstate 25 near Castle Rock when a driver named Kelsey Meyer fell asleep at the wheel. Meyer's vehicle struck another car, which then hit Headley's company truck. The force of the crash caused severe and lasting damage to Headley's spine.

Over the years that followed, Headley underwent three surgeries, including artificial disc replacement, lumbar fusion, and a third procedure to remove hardware from his lumbar spine. He also faced significant lost income. Meyer's Allstate policy carried a $1.25 million limit, which Headley settled for, but his total losses ran well beyond that amount. He turned to his employer's commercial auto policy issued by Cincinnati Casualty Company, which provided up to $1 million in underinsured motorist (UIM) benefits.

Cincinnati's response was to commission a brief independent medical examination and then notify Headley that the Allstate payment had already made him whole. The insurer placed zero value on his remaining UIM claim. According to Law Week Colorado's account of the trial, the company sat on the claim for more than two and a half years before Headley retained an attorney, and it declined to credit the opinions of his treating physicians.

Headley retained Dan Caplis of Dan Caplis Law and Jeremy Sitcoff of Levin Sitcoff PC. The legal team brought claims for breach of contract, bad faith breach of insurance contract, and statutory violations under Colorado Revised Statutes sections 10-3-1115 and 10-3-1116, which permit extra-contractual damages and attorney fees when an insurer unreasonably delays or denies a valid claim.

After an eight-day trial in Denver District Court, the jury returned a verdict of more than $3 million in October 2019. The finding of statutory bad faith also triggered an award of attorney fees and costs on top of the jury's damages figure. As Caplis stated after the verdict, a policyholder should not have to hire a lawyer to collect insurance benefits that are owed.