Insurance woes

This is the super condensed version. I’ve recently been turned over to a collection agency regarding some damage to my father’s vehicle. They (my Father’s Ins. Co.) claim that since my insurance will not pay (something about damage to resident relatives vehicles is not covered) I am uninsured and therefore liable for the damages. Now, don’t they have to prove I’m actually at fault? (I’m not) Can they go straight to collections without even calling or writing me first? (Pop’s truck was fixed Tuesday, I got the notice Friday) I’m not worried about the collections agency itself, I know about cease and desist and all that, but what concerns me is that appearantly proceedings have begun to revoke my license and vehicle registrations. :eek: Any ideas on how I should proceed?


What state are you in?

First, the usual warnings about seeking legal advice on an internet message board apply.
Second, you haven’t given enough details of the incident for us to know. Whose vehicle were you driving at the time? How did the damage occur? Who witnessed it? How can you prove that your not at fault? What state did this occur in, and is this a no-fault state? Were you in fact driving without insurance?

Are you a dependent of your father? Do you live with him? Whether you’re covered on your father’s insurance can be a murky area. For example, my auto insurance lists me as the only driver. However, if I someone else drives the car with my permission, they will be covered as long as they use the car only occasionally. I don’t know what the exact definition of occasionally is.

At a minimum, you should have contacted your insurance company as soon as possible after the accident occurred. You should contact them now to find out if your father’s insurance company has made a demand on them that they have refused to pay. You can ask them for their advice – it may not be useful, but you can at least check out their side of the story.

Driving without insurance is illegal in most if not all states. If it looks like you were, the insurance company may be required to report it and state agencies may be required to begin proceedings. In California, IIRC, it is illegal to drive without insurance whether you are involved in an incident or not. I don’t know the penalties, but they may include revocation of license and vehicle registrations.

He said he has insurance, it just won’t pay:

I can’t speak to your individual situation, but it’s not uncommon for insurers to deny a claim based on the fact that both parties are related to each other. It’s basically an anti-fraud measure designed to keep you and a relative from colluding on a claim, then profiting from the collusion. I would find out what your state’s appeals process is, though.

When I was still in health insurance, any claim for services provided by a family member (such as for home-health) would be flagged and researched for fraud, then returned to me for final denial. Fortunately, I wasn’t the customer-service rep who had to listen to the yelling. :smiley:


The collection agency where I worked oh so many years ago had no problem with debtors telling them to cease & desist. The debt went straight to the legal department. Just a bit of food for thought.

  1. Don’t know what state you are in, and can’t give you legal advice anyway.
  2. Here is an article (pdf) talking about what I think the exclusion your insurance company is relying upon. A couple of things to notice. First, it discusses Montana law, so your state’s law might be completely different. Second, it discusses Montana insurance policies, so your policy could be completely different. Third, I’m not sure that I even have the right type of clause. Fourth, if the clause is similar, some states have invalidated them.
  3. They don’t need to prove anything to turn it over to a collection agency, at least in most states. I don’t knon about yours.
  4. If you don’t like the collection agency contacting you, send them a cease and desist letter.
  5. You should talk to a lawyer in your state for accurate and specific legal advice.

I am not seeking legal advice, you are not a lawyer etc. I am in Washington State. I believe it’s a no fault state. I live in the same house as my father, but have seperate insurance policies, from different companies. I was (still am) insured.

My truck was stolen from the parking lot at work, then recovered by the police a couple hours later. While I was picking up my belongings and putting them back into the truck, my Dad was trying to get the truck started via hotwire under the hood (the ignition switch had been damaged). We didn’t notice that the thief had left the truck in drive, so as soon as the starter cranked over, the truck started and began to roll forward at a fast idle. I ran toward the driver’s side to try to hit the brake, but only managed to sprain my knee before my truck collided with the side of my father’s truck. Insurance companies were notified soon after. Mine immediately stated that they would not pay since my father and I are related (duh). His insurance then said that they would pick up the repair cost since he had full coverage, and that I would not held accountable. He picked up his repaired truck Tuesday, I got collections notices in the mail Friday.

So, not only was I insured, I was not operating a vehicle. And if the thief had damaged anyone’s property, or had the truck smashed through the wall of a nearby business, my insurance would have covered that. :confused:

Sounds fishy. I would start by contacting these people:

Here is a link to the website of the Insurance Commissioner.

WA is not a no-fault state, as far as I can tell. But that is irrelevant, really.

This Hawaii case discusses Washington case law on the resident relative exclusion.

First, some unsolicited advice–it was extremely inadvisable to attempt freelance repairs on a stolen car without notifying your insurance company first. They’ll want to inspect it, inventory any damage, and determine whether to repair or replace it. By attempting freelance repair, you give them an excuse to deny a property damage claim on your truck. This may not be an issue–I don’t know how extensive the damage to your truck was, and you don’t seem concerned about it in your post–but still, you should have notified your insurance company first.

There are two aspects of auto insurance at play here–property damage (Part D) and liability (Part A). With respect to property damage, it sounds like everything was handled correctly–his insurance should pay for the damage to his truck, and did, and yours shouldn’t, and didn’t (because it wasn’t your truck, and you weren’t driving it).

The next issue is liability. Having paid for your father’s property damage, his insurance company assumes the right of subrogation against any party held legally responsible for the loss. My understanding has always been that, if they want to exercise this right, they have to sue you, not just send out a bill and turn it over to a collection agency. But, I don’t know . . .

That sounds like an assurance that they would not attempt to subrogate against you. I’m a little surprised that they would say that over the phone.

:confused: Did they say why they changed their mind? If they do choose to sue, it sounds kind of doubtful whether you’d be found liable anyway. Also, if they choose to sue, your insurer will then have to decide whether to defend you. I don’t know whether a family exclusion applies to your liability coverage.

Of course you were. The fact that an exclusion within your policy may apply to a particular accident doesn’t mean that you’re uninsured. It sounds like there are a lot of misunderstandings here. Good luck in getting this mess cleared up. It probably isn’t as bad as it sounds.

Thanks. Gfactor. I have been in contact with the state OIC.
I made a round of phone calls this morning, even talked to the guy who actually sent the claim to collections, and oddly enough, the collection agency has actually been the most helpfull. I told them that I really do/did have insurance, gave the claim# etc. and the rep said “We’ll take care of it.”
I’m just amazed that an insurance company can take action like that without any legal justification.
Where can I get insurance against my insurance company being a bunch of slimy weasels?

Freddy, my truck was not damaged in the collision(huge steel brush guard), and the “freelance repairs” consisted of a jumper wire, just enough to get it out of the neighborhood it was abandoned in (as advised by the local police). I do not carry full coverage insurance (the truck is 28 years old) and did not expect anybody to pay anything toward my truck. My Father’s truck however, is only about 2 years old, and I reported the collision to my insurance, skeptical that they would pay, as a courtesy to my old man, since he was only helping me, and did not deserve to take a financial hit.
If I had thought for a moment that I was liable, and would have to pay for repairs, i would have just done that. Why involve insurance companies and inflated repair costs when I could have just paid out of pocket for significantly less (eg. one new chrome wheel, dealer cost $500. My real world cost $45.)

I appreciate all the responses. Thank you.

Well that’s why we have bad faith law.

Of course, that assumes that the insurer really had no basis to deny the claim. I am not a Washington lawyer, and I don’t have enough facts to even guess about that.

I’m surprised we haven’t heard from Inigo Montoya. He is ubiquitous in these insurance question threads. And he has the inside track.

But, see, if you’re not liable, then your insurance company is absolutely right not to pay. They won’t pay for damage to someone else’s property just because you were peripherally involved in the accident–you have to be liable for the damages.

It sounds like it’s your father’s company who is being slimy, by assuming (on what basis, I don’t know) that you were liable and that your insurance wouldn’t pay, and by reporting you as uninsured.

It would seem to me, then, that since your father was hotwiring your truck, he’s the one who’s liable, right? I’ve done things to my own car in which I was liable for which my no-fault insurance paid for in the state of Michigan. I didn’t even get an increase because I was liable but not negligent. So… it would make logical sense that your father is liable, and his own insurance company is on the line. Heck, in the strictest sense, he was driving your truck during the collision.

That’s exactly how I see it, but I can’t really pin the blame on Dad because he was helping me, and how could we know that the thief was discourteous enough to leave the transmission in drive? Yeah, I guess a reasonable person may have checked, but when it’s two in the morning and you have to walk past the local constabulary questioning the punk who (allegedly?) stole your vehicle, you may not be in the proper state of mind for operating a motor vehicle.

But then again, when am I *ever * in a proper state of mind?


Oh, I didn’t mean to imply that you should go screaming at your dad. Only that if he’s not already told the story to his insurance company, maybe he should do so. Being that you’re in a no-fault state, neither he nor you should have ever gone to your insurance company. He should have gone straight to his. His vehicle damaged, his insurance. Okay, that’s what you’ve done. Now his insurance company is going after you because you’re the “liable one” and it was your car. It’s clear that you’re not liable, though. Your father is liable. Now his insurance company should pay the claim, even if he is liable. Then, if he’s not also negligent, there may not even be a co-pay or an insurance premium increase. If he’s a good, long time customer, they probably won’t push it too much. Right now you’re NOT their customer, so they feel like they can come after you.

I didn’t take it that way at all. It was just an unfortunate accident, nobody is *really * to blame. Except the thief.
Anyway, Pop has talked to his insurance company, and everyone is surprised that the case went to collections. :smack: So I figure in two years when I go to get my license renewed, I’ll learn whether or not it’s all been straightened out. :dubious:


ubiquitous? Isn’t there a word with some love in it that you could have looked up? :slight_smile:

In addition to the other good answers, the OP nailed it in my opinion with:

And the answer to this is a mighty big fat “Yup.”

I’ll repeat Balthisar’s response: You weren’t driving, you were not liable. Period. In fact, if anybody’s at fault it’s your old man for failing to take precautions to keep your vehicle from colliding with another object. He was starting the vehicle, doesn’t matter if he’s got his feet on the pedals or on the ground in front of the car. So there.

Pop’s insurance company is wrong for sending you to collection. I hope for their sake your credit is not adversely affected by this action. If you haven’t already done so, speak to his insurer again to make sure they understand you had nothing to do with the movement of your car at the time of the loss. If that person doesn’t say, “Jeez, what were we thinking?!” speak to his/her boss. If that person also fails to slap his/her forehead and offer to pay for damages to your truck caused by their insured (there will be no deductible for this, it’s getting paid by Pop’s liability coverage) then get with the Washington State Insurance COmmissioner’s office and prepare to have some fun with those dirtbags at Pop’s insurance.

Sounds like bad faith to me, but give them every opportunity to screw this up before you play that card.

As you wish! :stuck_out_tongue:

How about familiar? Embraced?

Stayed away from “stinking with.” :wink: