QuestionRe: Auto Insurance Deductible
Dear Mr. Doctor Settlement:
My car was hit bay another car when I was backing up. My insurance company Nationwide says I can go ahead to fix it, but I have to pay $500 deductible until it is determined that it was the other driver's fault. He said ha has not been able to contact other side's insurance company. It's been many weeks already. Isn't there any time limit in law that the insurance company has to pay the deductible? They can keep telling me that it was not decided because they cannot contact the other side and keep avoiding paying the deductible. I have not repaired my car because I want to make sure I will get paid for all.
AnswerHi Makoto,
Dr. Settlement is just an old war horse for personal injury insurance fights. I do not have any real experience in auto insurance deductible issues inasmuch as that kind of thing gets resolved long before the clients come in to my office for representation regarding bodily injury damages. Hence, I want you to consider asking one of our very able insurance adjuster experts on this board. They work with this kind of issue daily.
Still, since you took the time to ask me, I am going to chime in with my two-bits worth. In the first place, you do not identify the state that we are dealing with and whether or not you have no-fault laws that apply to property damage claims.
And since the larger majority of states are at-fault states, I guess we will have to assume that you are from an at-fault state. As such, the general rule on claims against the tortfeasor for property damage is that you can either have the tortfeasor do the repairs (the most common solution chosen by victims), or you can have your own company do the repairs.
Before we get too far, Makoto, let's understand that "first party" means YOUR insurer, and "third party" means the tortfeasor's insurer.
If you elect the tortfeasor's insurer to do the repairs, there is, of course, no deductible. If you elect to go through your insurance, the deductible is always paid by the insured at the time of completion of the service, UNLESS the first party insurer already has an acknowledgement from the third party insurer that they will accept responsibility for the claim. In that case, the first party insurer will waive the deductible since it already has acknowledgement from the other side that the property damage claim will be paid in full, and hence, your first party carrier will be reimbursed the deductible that it has waived.
Does that make sense?
It sounds like that is what your insurer is trying to do for you. It is trying to get the other side to agree to liability. But there are many claims in which no such arrangements can be made that early in the process, and there is no excuse on the part of the insured to fail to pay the deductible. There is not any time limit, as you ask.
Absent some unusual state administrative code in your state, there is no requirement on your insurer to try to fix it so you do not have to pay the deductible. It IS true that almost all states do require the insurer to pursue the deductible when they go after the tortfeasor's insurer. That means the first party insurer will include its insured's deductible in its claim versus the tortfeasor's insurer. But no at-fault state requires the first party insurer to make such arrangements before the vehicle is repaired.
IMO, your insurer is under no obligation whatsoever to waive its deductible payment. If, as you say, you want to be sure that all is paid, why did you not make the tortfeasor's insurer handle the claim? It is not too late to do that. Just tell them to make the repairs. Here are some pages from our website regarding property damage repairs and diminished value claims.
Www.SettlementCentral.Com auto accident free information on vehicle property damage claims.
Auto Accident Collision Repair Shops & Insurance Adjuster Relationships Explained in Answers by Doctor Settlement, J.D.-Auto Accident Insurance Claim Expert
http://www.settlementcentral.com/page0456.htm
Hire YOUR OWN Auto Collision Repair Expert for Repair Negotiations & Supervision—Diminished Value Insurance Claim Settlements
http://www.settlementcentral.com/page0457.htm
Accident First Steps: Report to Insurance? Save on Storage; Choose Collision Repair; Rental Car Rights
http://www.settlementcentral.com/page0458.htm
Diminished Value Insurance Claims Explained in Answers by Doctor Settlement, J.D.-Auto Accident Insurance Claim Expert
http://www.settlementcentral.com/page0454.htm
Diminished Value-What it is and How to Make an Insurance Claim for a Cash Insurance Settlement
http://www.settlementcentral.com/page0455.htm
I trust that my extra time here has produced some information that has been of value to you, and thus I would respectfully request that you take the time to locate the FEEDBACK FORM on this site and leave some feedback for me.
Best Wishes,
Dr. Settlement, J.D. (Juris Doctor)
http://www.SettlementCentral.Com
