I have an auto insurance question, please help!?

Question

Resently my girlfriend and I were in a minor accident in Michigan. We were in a Meijer parking lot when someone backed into us. We got his information and called our insurance company. They sent out an appraiser and he wrote an estimate for the damages. Soon after that he called and told us where to take the vehicle for repairs, the body shop called us and we scheduled an appointment to get it done. We took it in and they began repairs. Then about a week later we recieved a letter in the mail telling us that the accident was under investigation. We didn't hear anything for a couple more days. Then we get a call telling us that our claim has been denied. Well the car is basically finished and we also got a rental car as well. Now their saying that we have to pay everything. Their reason is that my girlfriend just payed her insurance the day of the accident and that her coverage didn't start till the next day. So what should we do are we screwed? Please help!

Answer 1

Well you have to realize how suspicious your scenario sounds.

What would have stopped you from getting into an accident with some damage and then going and buying insurance and making a claim AFTER the accident? Nothing.

That's what the insurer thinks happened.

Since you dont' have a police report to verify the time of the accident, you may need to get the other person you hit to try to estimate the time of the accident.

Here's why.....when you first buy insurance and you pay the premium...the insurer writes you a document called a binder and paid receipt....its basically the paperwork you have when you leave the office.

Your insurance is in force the very second you have that binder in your hand....NOT the next day.

The truth is that the insurer thinks you are engaging in insurance fraud by claiming an accident on the same day you bought coverage.

Unless you can prove otherwise....they are right.

You will need the other party to prove you had the accident after you bought the coverage.

If you can't, then you have no way to prove you are not trying to rip off your insurer and they won't pay...which means you'll have to pay the body shop.

Answer 2

You said your girlfriend just "paid her insurance the day of the accident." This could mean a few different things, so I'll try to answer each scenario.

If your girlfriend had a lapse in coverage (i.e. her policy cancelled for non-payment of premium), in most cases the payment is applied and coverage is reinstated the next day, not immediately. If this is the case, your girlfriend was driving her vehicle while it wasn't insured and you're fully liable for the repairs, not the carrier.

Another possibility is that she purchased coverage brand new. If that's the case, you're issued a binder for coverage with a specific effective date. If you purchased coverage on December 13 but asked for an inception date of December 15, then coverage begins at 12:01 AM on December 15 and not the second you hand over the downpayment.

If on December 13 you asked for coverage for December 13, typically your binder will say 12:01 AM (rarely it will be 12:01 PM). If this is the case, the insurance company will investigate when the coverage was written versus when the accident happened. If the accident happened before the policy was bound, then they are within their rights to deny the damage. If the accident happened after the policy was bound, then there should be coverage.

Based upon your description, though, it sounds like this is the first case where there was a lapse and a reinstatement. The good news is that you were backed in to, so she may be able to pursue the other carrier for the repairs.

Answer 3

Something sounds really off here.... i have a strange feeling that if we talked to the insurance company they would have a totally different story.

I just dont see it possible (unless you used a small little horrible insurance company or something) that they would AUTHORIZE repairs to start with a finalized estimate and then just take it back. It just doesnt happen.

Even if on accident an adjuster authorizes repairs and then realizes you dont have coverage- they arent just goign to take it back once theyve told you to begin- theyd be in a heap of trouble.

I sense we arent getting the full story- are you sure they gave you a finalize estimate and told you to begin repairs? Did you do something worthy of them investigating coverage such as do a fraudalent claim and did they find evidence?

And.. btw... coverage does NOT start the second they get your money- i hate people who answer crap and dont know what they are talking about. You pick the day your coverage begins and you can pay ahead at a time ahead of that date if you wish and that doesnt mean coverage has begun.

Answer 4

Since drivers' licenses are state-issued, this is a state matter, although the Federal Government can influence the states by threatening to withhold Federal Highway Funds (the way they did to get every state to raise the drinking age to 21). In short, there is a philosophical difference here. Driving is a priviledge granted by the State and when driving, one has a responsibility not only to himself, but to others on the road. Making auto insurance mandatory can be seen as a cost of enjoying this priviledge, part of a citizens obligations for th overall safety of others. Health care is a personal issue. Requiring a person to purchase a product for his own personal use seems to many like requiring all citizens to buy auto insurance....whether they drive or not. Somewill argue that the requirement will bring down the costs associated with the uninsured getting care in emergency rooms and so on, but the same could be said for mandatory auto insurance. Imagine how premiums would go down if all non-drivers were forced to buy policies as well. So again, there is a philosophical issue beyond the "will it bring down costs" question.

Answer 5

Ok here is what you do. First off, the rule in insurance is that the moment you give your premium payment to an insurance collector you are then covered. If your GF gave it to an agent personally, then they cannot fight the claim because your GF gave them the premium. Remember, you are covered the moment they receive the premium. If you mailed the premium in... you are in for a lil bit more of a fight. Since you have the other person's info call their Insurance Comp and have them deal with it. Usually its better to do that in a situation where its not your fault, so you dont have to spend the deductable out of pocket. As future advice, never get your vehicle fixed until AFTER you receive a check from the insurance company unless you A) NEED the car driveable NOW and B) can afford it. Good luck with your issue. Stick it to them!

Answer 6

Sounds like you are screwed. Are you sure that they authorized repairs? If they were still investigating they could see your car but if you didn't get a check for the damages that really wasn't the ok to get it fixed. You can call up the chain of command, but unless they erred and you have proof that they told you to get it fixed you're going to have to pay for the damages.

Answer 7

If your policy was cancelled and your girlfriend made payment after the cancel date then you are screwed as far as your insurance company paying the claim, but seeing how somebody backed into you it seems they would be the one considered at fault, so since you have his info go ahead and file the claim with his company.

Answer 8

Did you pay the premium before or after the accident. Before, you have coverage, after, you have nothing. Good Luck

Answer 9

Her coverage should have started as soon as she contacted her insurance company to obtain coverage or AT LEAST when she paid her premium. You need to fight this. If they sent an adjuster, they should have been prepared to pay. What insurance company was this?