Auto Insurance Adjuster Blatantly Lies to Third Party Claimant
A dim-witted driver hit me last Saturday causing an auto accident that tied up four lanes of rush hour traffic and nearly destroyed my new 2007 Ford truck. The body shop I had it towed to estimated more than $20,000 in damage and said the truck might not even be repairable.
Of course the accident left me pretty aggravated since it wasn’t my fault. Then the claims adjuster for the other guy’s insurance company took my rage to new highs when he told me the truck WAS repairable, but I couldn’t go to the auto body shop I wanted to go to! I had to go to an auto repair shop the insurance company recommended.
I thought there was a law that gave me the right to choose the auto repair shop instead of the insurance company. Not being certain of my rights I didn’t argue much. But if you tell me to the contrary that I am allowed to go wherever I want to have my truck repaired, I’m going to be calling that insurance company back and eating that guy’s lunch.
Rick
Akron, Ohio
David Williams writes:
Indeed you are correct, Rick. You have the right to get your truck repaired at the auto body shop of YOUR choice - that is, IF you want it repaired.
As a third-party claimant you, my friend, are in the driver’s seat on this claim and you are entitled to recoup all losses caused by the negligent driver. He is ultimately responsible for paying restitution to you - an amount sufficient to make up for all of the damage he caused. The amount you collect can’t exceed the value of your truck, and you can use the money you receive for repairs, or spend it on something else. It’s your money and your decision as to how it’s spent.
If the at-fault party has insurance as you say he does, and his insurance company wants to make you a fair offer, you may accept the offer on the negligent party’s behalf if you so choose. If on the other hand the insurance company wants to shortchange you or impose limits on your recovery, you are under no obligation to deal with them.
Your choices then become as follows:
1) You may pay your deductible and turn the claim in to your own insurance company. If you do this, you will go from a position of having no limits on your recovery beyond what is fair and reasonable to being bound by the limits and exclusions within the insurance policy you purchased. Your own company will have the right to (a) repair the damage to your truck, (b) total it out and pay you the retail value so you can buy another one, or (c) replace it with a like-kind vehicle boasting similar miles and in similar condition. Your company has the right to decide which of the three settlement options would be most economical for it, and you have little say in the matter.
2) You may pay the cost of repairs out-of-pocket without involving either insurance company. When claimants do this, they often have an attorney send a formal letter of demand to the at-fault party insisting they pay the total amount of the loss by a specified date. If the negligent party fails to meet the demand, filing a lawsuit and waiting for your day in court will be next on the agenda.
The truck is YOURS, Rick! Nobody can make you do something with it you don’t want to do.
Just remember that the negligent party’s insurer has a duty to protect their own policyholder from losses he suffers. They have no obligation or duty to you. As such, you shouldn’t expect fair treatment from them or from repair shops the insurance company recommends.
For best results, I’d suggest that you:
a) Not speak to or negotiate with any insurance company over the telephone - this includes both your insurance company and the negligent party’s insurer.
b) Always demand that insurers you deal with put their positions and offers in writing so you have time to gather your thoughts and check the validity of their statements. This written dialog will be advantageous in that it will make insurance adjusters think twice before lying or making recommendations that run contrary to law for fear the paper trail will come back to haunt them.
When a person buys auto insurance from a tight fisted insurance company that doesn’t want to pay fairly after an auto accident, the person is not relieved of his obligation to pay for damage he caused. In other words, this guy still owes you even if his insurance company bails out entirely.
My advice is getting an attorney to begin putting pressure directly on the at-fault party to pay the total amount of the loss owed to you. Also, put a timetable on when the payment is due. As you make your decisions and demands, act like the negligent party doesn’t have insurance. By doing this you will force him into a position of having to deal with his own insurance company. While you don’t have a cause to go after his insurance company directly, he may have, if they fail to meet the contractual obligations they agreed to in the insurance policy they sold him.
In my opinion you are in a better position as a third-party claimant than you would be as an insured dealing with your own insurance company - unless your own insurance company is willing to total your truck and pay you its retail value, allowing you to get this behind you quickly. The bottom line: I wouldn’t be anxious to get a truck repaired in either a first-party or third-party scenario that was so extensively damaged. I would be looking for other settlement alternatives that didn’t involve auto repair.
You may think you bought a good auto insurance policy. But, when it comes to first-party auto repairs, the limits and exclusions outlined in the fine print of insurance policies are fierce these days, and even the best policy will be inferior to the rights you possess as a third-party claimant.
If your policy is like most, you will probably find your own insurance policy limits or excludes everything from rental coverage to diminished value. Aftermarket or used parts may even be used during a repair when they are available. So, I wouldn’t recommend you involve your own insurance company unless they are willing to total your truck, or you have no other options to collect the losses you are owed.
In conclusion, there is no reason for you to feel pushed around, Rick. Insurance companies only recommend auto repairs in network provider shops because they can and it often saves them a ton of money on claims payouts. You can cut the insurer off at the pass by refusing to even listen to his offers, and dealing with no one other than the guy that actually owes you.
There are many other strategies beyond those mentioned in my response that may benefit you. For example, you may, depending on your income bracket and tax position, wish to take the loss against taxes you owe. Likewise, you may find it advantageous to give the truck away to an auto repair school that could use it as a training aid in their classroom.
Consult an attorney that knows the ins and outs of the legal system in your locale and involve your CPA to find the financial strategy that may benefit you the greatest. In the end, I’m certain you’ll find a good solution to recover from your losses, as long as you are not seeking revenge.