A sample policy limits demand letter is set forth below:
“[Defendant’s Insurance Carrier]
Attn: Claims Manager, Re: [Plaintiff] v. [Defendant], Date of Accident, Etc.
As you know, our office represents [Plaintiff] who has a claim for personal injuries and properly damage against your insured [Defendant] arising out of an incident that occurred on the date stated above.
You have previously advised us that the policy limit on [Defendant]’s insurance coverage with your company is [$] per claim for personal injury.
The general and special damages sustained by our client, as detailed below, are substantially in excess of that amount, and we believe that if the case goes to trial he will undoubtedly recover far more than [$]. Nevertheless, because of the limited insurance coverage available in this case, [Plaintiff] has authorized us to settle all claims against your insured for the policy limits, [$].
[Plaintiff]’s settlement demand is based upon the facts stated below:
1. Collision of vehicle: [Statement of facts].
2. Liability: [Basis for liability].
3. Injuries: [Details of injuries].
4. Interim medical bills: [List of medical bills & expenses].
5. Earnings loss: [Explanation of earnings loss].
6. Conclusion [Summary of and Request for damages].
The offer is conditioned upon:
A) Your furnishing us with a copy of the complete insurance policy insuring [Defendant], including declarations;
B) Your notifying us in writing of your acceptance prior to expiration of the time stated below;
C) Your furnishing us with the proposed release and other closing papers for our review within ten [10] days thereafter, and
D) A prompt exchange of the settlement draft for the fully-executed release and settlement documents following our review and approval thereof.
We are certain you are aware that if a judgment in excess of [Defendant]’s policy limits is entered against him in [Plaintiff]’s lawsuit, when you have had the opportunity to settle this matter within policy limits, your company may be held responsible for the difference [Silberg v. California Life Ins. Co. [1974] 11 C3d 452). We anticipate your evaluation of [Plaintiff]’s settlement demand in light of this factor.
We have enclosed herewith or have already supplied you with copies of all records and information that you have requested for evaluating this claim. We therefore believe that you are in a position to act promptly upon this demand. Accordingly, this offer shall remain open until [Date and Time]. After that time, this offer is withdrawn.
[We are enclosing an extra copy of this letter as a convenience so that you may forward same to your insured, [Defendant].]
Respectfully, [Name of Attorney for Plaintiff]”
[California Practice Guide: Personal Injury [certain citations omitted]]
