by Guest » Mon Nov 23, 2009 07:50 pm
My stepson has a valid auto insurance policy in NC. A few weeks ago, he was in an accident while going straight through stoplights. Another party turned in front of him and she was ticketed by the police for failing to clear the intersection. Her insurance company has denied his claim due to 1% contributary negligence. The problem with his own insurance is, collision was taken off of his policy in March of 08 by the insurance co. as he did not have a NC drivers license. Being young and stupid, he didn't note all that. Now his car is totalled and he owes $11,000 on it. His agents says that he was never made aware that there was a financing company involved. That is not true, as the agent actually drove to the dealership to pick up my stepson, because the finance company would not let him leave with his newly purchased car until he had obtained insurance. This agent arranged all his insurance for him. My gut tells me the agent dropped the ball in not adding the finance company to the policy and is now trying to cover himself. Can stepson sue the other party & insurance company for the collision or is there recourse against his agent? Thanks for any help you can provide.
Posted: Wed Nov 25, 2009 08:50 pm Post Subject:
I'm also big on personal responsibility. In fact, I didn't talk to this stepson for years, due to his idiotic behavior and lack of personal responsibility and consideration for others. He has been, in the last few years, trying to pull his life together, pay off bills, embark on a career etc. So, having been in the insurance field in the past, but not in the US, I figured I'd see if there was any way I could help him out of this, as I'm unfamiliar with the different rules in each state. I appreciate everyone's input.
Posted: Sun Nov 29, 2009 08:30 am Post Subject: Someone is not being entirely truthful here
When a vehicle is financed, the lienholder wants to be sure they get smoe or all of the money they're owed in the event the vehicle is totaled. No way around this.
As others have stated, without proof of collision coverage, the lienholder will purchase coverage in its own right, and stick the registered owner with the bill (figure about 3-5 times the cost of a "real" policy).
So in this entire thread, someone is not being entirely truthful about what's going on here.
If the agent genuinely knew the vehicle was being financed and failed to include the information on the personal auto policy application, there is a NEGLIGENCE CLAIM against his Errors & Omissions Insurance waiting to be paid.
If the child concealed the fact from the agent/insurer in his application, then the lienholder would have slapped the collision coverage on the vehicle ASAP, because it would not have received the Declaration Page or insurer's notification.
My guess is that the agent quoted the policy with collision, the lienholder got its Dec Page, and the child later cancelled the coverage, and the lienholder was not made aware. So who get to pay the lienholder? The wayward child who has a contract with them.
Can he sue the at-fault party? Of course. Can they file bankruptcy? Of course. Can the child get out of paying his note? Of course. He can file bankruptcy.
Better get another car financed with another lender first. And hope that the bankruptcy judge doesn't force him to divest of it.
Ahhhh . . . the blissful ignorance of youth.
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