QuestionI was in an auto accident in Nov. The other party's insurance company accepted fault in early December. I am asking that they reimburse my deductible and rental car expenses.
1. I received a letter from the recovery department of my car insurance company saying that they were filing an action against the third party (who I assume is the other driver) and they were including my deductible as part of the action. They also indicated that if there is a recovery I would receive a "proportionate" share of the recovery. Since I want my entire deductible returned, shouldn't I pursue the deductible myself and not subrogate it? Is the other driver's insurance company responsible for the deductible or is it the driver? Couldn't I pursue my deductible in small claims court?
2. The other driver's insurance company has paid for the cost of the rental car for the 12 days it took to repair my car. However, they are refusing to pay for the insurance coverage I bought when I rented the car. Aren't they responsible for all my costs relative to renting this car, since I wouldn't have had to incur any rental car expenses if their driver hadn't caused the accident? Should I demand that they pay these expenses or are they excluded?
Thanks for your help, Debbie
AnswerHi Debbie,
You have asked two very good questions, and I will do my best to answer them, although as a trial attorney we deal more in bodily injury than vehicle rental rights. Here is a bit of information on rental rights from our site dealing with do it yourself auto accident insurance claims www.SettlementCentral.Com
http://www.settlementcentral.com/page0458.htm
#1. Write to your insurer: no proportionate sharing in costs---unless they are willing to reciprocate when you collect their paid out PIP medical expenses :-). Probably their letter is a form letter and there will be no such proportionate sharing.
Here is the deal: they—your insurer—get to sue in your name for their expenses paid out. Most people allow them to collect the deductible. 99% of the time there is no proportionate sharing of expenses since all companies are part of the Intercompany Arbitration Agreement among auto insurers.
Your insurer has done the right thing for most insureds who do NOT wish to become involved in litigation. BUT, the cause of action is YOURS, not THEIRS, and the terms of your subrogation clauses will make that clear. By accepting payment from your insured you do give them the right to pursue the tortfeasor for what they have paid out. You CAN—but do not HAVE TO—allow them to collect your deductible.
So, send off the e-mail with the terms as I set forth above, and THEN call the property adjuster and get the lay of the land. Two-bits says that this is a standard form letter that they send in every case, and they expect full payment without any further costs, and further, they intend to pay back 100% of your deductible. That is the norm, and I would guess it is what will happen in your case.
#2. The tortfeasor's rental car obligation is ONLY to place the victim in the same position as she was before the accident: with a vehicle of similar capacity and function. I do not think that the tortfeasor has to provide insurance (but see my caveat below).
What would this mean if the victim were driving a vehicle with no insurance and she had to rent a car? Would the tortfeasor's insurer be obligated to provide the victim with something she did not have before the accident, to-wit: insurance? Wouldn't making the tortfeasor buy insurance for someone who did not have be a "betterment" in that victim's circumstances? Usually the victim has to pay the tortfeasor's insurance when it provides a betterment in the victim's position. Think, for example, of replacement of a worn air conditioning condenser of a set of worn tires. When those are replaced by brand new (because there is no other alternative), the victim has to pay the tortfeasor.
If the victim has insurance, then of course her insurance WILL cover the rental car. Hence, the topic never comes up—the victim has the same coverage as she did before the accident.
If the victim feels that such coverage was insufficient, then she must pay for whatever she decides to purchase to make her feel sufficiently insured. Does that make sense?
Now, here is my caveat: maybe I am wrong (yikes, is this even possible?—a resounding YES comes from my wife!). With respect to your question on the tortfeasor's duty to pay insurance, I am going to have to plead attorney inexperience inasmuch as we deal almost 100% with bodily injury claims, and almost never get involved with haggling over small issues on auto body repairs and rentals. It is not that we are snotty: there is no way to justify our fees with so little at stake. Either the client pays for our work, in which case she loses money, or we have to work for nothing—which is mostly what happens under such circumstances.
So I have two responses for you on this topic. First is my own two-bit legal analysis (above), and second—since I am going to come down against you on this one item—is my suggestion to check with one of the insurance adjusters on this Board.
For my thoughts that run against your wishes in getting your insurance paid for, I am going to ask you to start at the place wherein we first establish the rights of the victim—which would be you, Debbie.
The tortfeasor has to put the victim back to the situation she was in just prior to the accident. There is no extra duty on the tortfeasor to make the rental vehicle insured for these reasons.
First, if the victim does already have auto insurance, then she will remain insured with that extent of insurance she had purchased when she drives the rental vehicle.
Second, if the victim had no insurance at the time of the accident, so be it: she does not get a bonus of making the tortfeasor pay for something that she never did have before the accident. Does this make sense?
If it does not make sense to you, then we do have three insurance adjuster experts on this Board, all of whom all have some pretty good experience on the details of auto crash insurance rights.
I trust that my 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
