When a lawsuit lending company decides how much money to provide you with lawsuit funding in Texas, they look at things like how much money you might win, how strong and complex your case is, and how likely it is that you’ll succeed in a settlement or award. This funding decision is about the lender’s business needs and is contingent upon the legal procedures for initiating lawsuits in Texas.
Let’s take a look at the legal aspects of civil lawsuits, personal injury cases, damage caps, and insurance requirements in Texas and their influence on obtaining a Texas lawsuit loan.
Statute of limitation
In Texas, civil lawsuits must be filed within two years, as per the statute of limitations. Failing to do so may result in being unable to obtain the rightful compensation.
Lawsuit loan companies can provide legal funding in Texas only if your personal injury claim is filed within the statute of limitations.
Modified comparative fault
In Texas, you can get compensation for an injury case even if you share some of the blame. But in Texas, if you’re more than 50% at fault, you won’t receive compensation. As long as you’re 50% or less at fault, you can still seek compensation for your injuries.
Due to the Modified Comparative Law in Texas, third-party funding companies can offer you lawsuit funding only if you’re 50% or less at fault for the accident.
Damage Caps For Medical Malpractice Cases
Texas does not currently have a cap on pain and suffering (non-economic damages) except for medical malpractice. This means there are restrictions on the amount of money you can receive when suing doctors or healthcare providers for medical negligence. You cannot sue an individual healthcare provider for more than $250,000, even if multiple doctors are involved. Furthermore, the total amount for non-economic damages, such as pain and suffering, cannot exceed $500,000 across all the medical facilities involved.
Overall, the maximum amount you can receive is $750,000. So, if you need funding, you can still be eligible for medical malpractice lawsuit loans in Texas, typically up to $75,000.
In Texas, punitive damages are limited and have a cap based on the economic and non-economic damages awarded. According to Texas law, punitive damages can reach a maximum of $200,000 or two times the economic damages, plus $750,000 for non-economic damages. For instance, if you receive $1.5 million for economic damages and $1.1 million for non-economic damages, the punitive damages cap is set at 3,350,000 (including the additional $750,000).
If a case is strong enough to win, plaintiffs can potentially get Texas lawsuit loans of up to 10% of their punitive damages.
Lawsuits Against Government Entities
Government organizations are generally protected from personal injury lawsuits in Texas, but there are some exceptions. If you are injured due to the negligence of a government employee, you will be limited in your capacity to sue. The cap on each person involved in the incident is $250,000, and the total amount for a single event cannot exceed $500,000.
Due to these personal injury laws, funding amounts for settlement loans against government claims in Texas are capped at $50,000.
The Insurance Company
In Texas, drivers must have sufficient insurance coverage to account for any costs resulting from a car accident they cause. The minimum coverage required is called “30/60/25 coverage”.
- $30,000 bodily injury liability per person,
- $60,000 bodily injury liability per accident,
- $25,000 property damage liability per accident.
However, these minimum requirements may not cover all accident-related expenses. According to the Texas Insurance Department, uninsured/underinsured motorist coverage can help pay for car repair and medical expenses in a hit-and-run or an uninsured motorist accident. While not mandatory, adding this coverage to your car insurance policy can provide additional protection in an accident caused by an uninsured or underinsured driver.
But if you’re injured in a car accident, and the other driver doesn’t have insurance or enough coverage, a funding company is unlikely to offer financing for your lawsuit in Texas. In this case, there is a big probability that you will not receive a sufficient settlement (or a settlement at all) to repay the advance.
In sum, the at-fault driver must have sufficient insurance in Texas in order to qualify for lawsuit loans in the state.