Steven Plitt, Expert Witness Steven Plitt, Expert Witness
Insurance Bad Faith Claim Handling Expert Serving Clients Nationwide


The Colorado Supreme Court in Munoz v. American Family Mutual Insurance Co., 425 P.3d 1128 (Colo. 2018) rejected an insured's claim for prejudgment interest on an uninsured motorist settlement. In rejecting the prejudgment interest the Colorado Court looked at Colorado Revised Statute ยง13-21-101 which provides that a party is entitled to prejudgment interest where (1) a lawsuit is brought, (2) damages are claimed, (3) a damages award is received, and (4) judgment is entered. In the context of this case, the insured never filed an action against the uninsured motorist, never sought or received damages, and did not recover a judgment. Because of this, the Court found that the statute was inapplicable. The Court noted that the outcome was consistent with the nature of UM coverage, which was to put the insured in the same position as if the tortfeasor had been insured. If the insured had received a settlement from the third-party carrier, the insured would not have been entitled to prejudgment interest on the settlement amount. For the same reason, the Court found that American Family agreed to pay a settlement based on the tortfeasor's wrongdoing and that the insured was not entitled to prejudgment interest simply because the payor was his own insurance company.

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