Why Can’t the Jury Know If the Defendant Has Car Insurance?

If you have ever served on a North Carolina jury in a car wreck case, you almost certainly sat through the entire trial never knowing if the defendant had any insurance to pay the verdict. Surely no one in the courtroom – not the lawyers, the witnesses or the judge, ever mentioned it. Maybe someone mentioned that you shouldn’t make your decision based on anything irrelevant, like whether insurance premiums, in general, would go up.

But no one in that courtroom was going to tell you if the guy who got sued had any insurance. Or if the person bringing the case had maybe gotten paid something before the legal case ever got started.

That’s because in North Carolina we have Rule of Evidence 411, that says if a person or a company has insurance to pay a claim, the jury is not allowed to know.

The reason for the rule is to prevent prejudice in favor of some people and against others.  If a person or a company was negligent and caused an injury, they are legally responsible to pay the consequences, whether they have insurance or not.  Hopefully, if a person caused a wreck, they do have insurance to cover it. But that is not what the jury is supposed to deal with. The rule is there so that jurors will decide strictly on the evidence of legal responsibility, not ability to pay because that is what is fair and just.

So the rule has a good basis, but it does leave the jurors guessing and when they guess, they can guess wrong.  Here are some things that are not correct, but that jurors think because we are keeping them in the dark.

• That the defendant’s insurance money was already paid out, and now we are going to trial to try to collect even more money. This is never true. 
• That the person being sued has little or no insurance and is going to have to pay a judgment out of her own pocket. This is almost never true. Trials are expensive, and it’s usually not worth it to sue someone who has no ability to pay a judgment.
• That the person being sued is having to pay his lawyer to defend him. This is usually not true, because it’s the insurance company for the person being sued who pays for the lawyer.

If you are ever called for jury service, thank you in advance for participating in this great institution that is a bulwark of our democracy.   You will likely learn a lot, but you won’t learn whether the defendant has insurance, or how much insurance they have.  It’s okay though because your focus should be on whether the defendant is responsible, and if so, the value of the case, not whether the defendant has the ability to pay.