how long does a car insurance company have before it must payout a claim?

Question

I was hit from behind in my car and as a result my car was totaled. The police report says it was the fault of the other driver and his insurance company has already sent out a guy to look at my car. It has been approximately 45 days since the accident and the other guys insurance company says it needs a "statement" from their driver, who is not cooperating and has been unreachable since the accident. My lawyer even gave me a ballpark figure that the insurance company was talking about but, says that I must wait on them to reach their driver. Well if the other driver never shows up how long do I have to wait to get the property portion of the claim, that is to say when will the company have to legally pay for my car?

Answer 1

I'm not sure where George gets his information, but he's completely incorrect.....

Each state's DOI (Department of Insurance) regulates WHAT, WHEN, WHY, and HOW an insurance company does something. The DOI requires the insurance companies do an INDEPENDENT investigation of the accident....they are not allowed to rely on, as George says, police reports, for many reasons, but one factor could be because they are seldom accurate and to be quite honest, the officer isn't "investigating" the loss--he's writing statements & typing a report. A cop doesn't determine negligence, but what he can tell you is who violated what vehicle code. Depending on the cop, he may or may not provide additional info, such as skid marks, speed, etc......

As part of the investigation process, as well as contractual responsibilities with their insured, the insurance company has to speak with BOTH the driver and named insured (who can sometimes be 2 different people.) The have to 1) make the named insured aware of the claim and 2) verify the facts of loss with the driver. But this is just a small step, albeit a HUGE one, in getting closer to settling the claim.

The insurance company can't MAKE the guy cooperate, even though there is a cooperation clause in his policy. The other insurance can't pay the claim until he speaks with the driver/insured. All the insurance company can do is continue to make reasonable attempts to speak with the driver, and worse case scenario, they can deny coverage for lack of cooperation. But you don't know why the guy's not calling them anymore than they do...as far as they know, the guy's dead, in jail, or in a hospital somewhere.

As for how long do they have, you have to check with your DOI. Most states say upon receipt of proof of claim, i.e. estimate of damages, they have 10 days to pay or deny the claim. If the investigation is not complete, they must notify you in writing every 30 days of the status. This is just an example, so check with your DOI for exact procedures and timelines. They legally pay for your car when they have meet the requirements of BOTH the DOI and their policy with their insured.

As for you....you have a duty to mitigate your damages. What does this mean? You have to make reasonable attempts to prevent any additional damages/cost from incurring. If you don't have collision coverage, then you'll have to wait on your repairs I suppose, but that's not the other guys fault, that's your for not being properly covered. Your insurance will subrogate the at fault party if you do have collision.

Answer 2

I am assuming you have your own car insurance in force when the accident occured, right??? and you both at the scene and police was called and there is a police report. If its the other driver's fault then you are not responsible for the cost of any damage to your own car or the other driver's car. YOU DEAL WITH YOUR OWN INSURANCE CO FOR CLAIM. NEVER MIND ABOUT THE OTHER DRIVER. Your own insurance co should pay you within a reasonable period of time. The total amount of damage in $$$ sense might NOT be the same for you and for your insurance co. but you two have to argue this out. Yes, like other gent/ ladies said if you need the use of a car, you can rent a car and add the cost of rental to the damage, but you MUST get approval from your own insurance co. first before you go ahead to rent. the rest of the payment will just follow and you will get it from your own insurance co. When there is physical or other injuries involved then the problem will be more complicated. You didnt mention any in your question, so I presume you are OK. the other driver will deal with his/her insuramce co. in a similar fashion. hope this will clear up your mind and go after YOUR OWN INSURANCE CO. GOOD LUCK.

Answer 3

There is no advantage for an insurance company to stall or drag their feet when paying claims. If the insured will not give a statement or even file a claim the company could be stuck on that hill forever. Who knows where this guy is? He could be in jail or on the run or even dead. The fastest way to handle this mess from here would be to let your collision coverage handle your property damage and subrogate the other company. By the way...if you have a lawyer why not ask HIM these questions?

Answer 4

How long does a car insurance company have before it must payout a claim?

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Answer 5

From that length of time I think you are going to have to have your lawyer lean on the company a bit more. If the person at fault is doing a disappearing act then you need to see if your state has laws regarding this kind of behavior.

Regardless of needing a statement, the other insurance company should pay out in a timely manner. It should be their problem, not yours.

Answer 6

They don't need their driver. What he says is irrelevant. The police report is what matter's and if it put their driver at fault, they owe you a car . If they want to delay it, demand a rental vehicle, you have that right in most place's. Most policies also state the insured must report all accident's within a period of time (usually 24-48 hours). If he's violating that, thats a problem between them and him.


As far as personal injury etc they can drag that out for years.

Answer 7

insurance case can vary. some can even take up to 2 years to be settled. i recently had a accident and it took 6 months (i was passenger) and my friend (driver) closed hers at 1 year. good luck!

Answer 8

I won in court and have now been waiting since April 22, 2004.