Insurance question: legality and principle...

KnightLight · Post by **KnightLight** » Tue Sep 25, 2007 1:31 am

To make a long story short...

While I was moving some odds and ends to my new apartment, my car was rear-ended by a pickup truck, causing damage to the rear bumper. The other driver was driving with a suspended license and I believe she was arrested. I was not ticketed.

The other person's insurance company told me I was 10% liable for faulty brake lights and gave me $360.

My brake lights are in perfect working order, even after the accident. The insurance adjuster never checked them.

Should I just cut my losses and take the money, or should I pursue the extra $40?

And if I choose to pursue it, to what extent should I go?

fluffmonster · Post by **fluffmonster** » Tue Sep 25, 2007 2:09 am

you need to ask yourself how much effort $40 is worth. You will need to threaten them to get them to cough up. Whether that will work will depend on your leverage. Is what they are doing legal? If so, yer done...take your $360 and go home. If not, to what extent will you pursue it? Will lawyers get involved? Can you make them believe lawyers will get involved?

I would not be surprised if they are calculating precisely that you will decide $40 is not in fact worth it. Just think...if they do this to all their claims, that starts to add up to real money.

Veilan · Post by **Veilan** » Tue Sep 25, 2007 2:29 am

I take it you don't have a defence insurance?

Grand Fromage · Post by **Grand Fromage** » Tue Sep 25, 2007 2:36 am

I'd send a couple letters, but there's not much you can do. Any real, effective action is going to cost more than $40.

JaydeMoon · Post by **JaydeMoon** » Tue Sep 25, 2007 7:34 am

Call your insurance company and see what advice they have to offer. If you had full coverage, then they would actually handle the situation for you.

With only liability, they won't be able to act on your behalf, but they may be able to give you a clue as to what you should do. Or they may decline to do so to avoid the perception of liability on their part by 'offering legal advice'.

The big question is, who pays court costs. If you take them to court and sue them for the difference + court fees + work lost fees, hell, I'd do it. Asshole companies trying to screw you over need to be taught a lesson.

But I don't know if you can actually do that... we have a few lawyers and lawyer trainees here in ALFA... try ask them.

Almighty T-Dawg, or Mikayla.

I bet if you somehow looked into their practices and found a record of them shorting folks 10% all the time, you'd have a class action lawsuit to push... you'd be a hero.

Mikayla · Post by **Mikayla** » Tue Sep 25, 2007 4:50 pm

First: I am not your attorney and the following advice is not to be considered legal advice.

Second: If you wish to obtain legal advice, go to a lawyer, preferably one who specializes in auto-accidents.

Third: $40 is not worth much trouble. If you have the time, you can write letters to the other insurance company demanding the entire amount (presumably $400) explaining your break lights are in perfect working order.

Phoenyxx:

I bet if you somehow looked into their practices and found a record of them shorting folks 10% all the time, you'd have a class action lawsuit to push... you'd be a hero.

That would be extraordinarily difficult to prove - to have a class action, you have to have a class of plaintiffs "certified" by the court. To get class certification, you generally have to have common facts. The opposition will argue that each case has its own, unique facts (in your case, the break lights were out, in the other case, the person swerved, etc.) Accordingly, you are unlikely to get class certification absent finding a memorandum from the insurance company that says, in effect, "Screw every customer for 10%!" And of course, to have a chance to find that memorandum, you have to first file the lawsuit (which in California would cost you upwards of $350 just for the filing) and then you have to propound discovery (depositions, interrogatories, requests for documents, etc.), you have to fight the inevitable discovery motions ("we are not going to give that up - its irrelevant/privileged/not-available") and then, maybe, you find the "smoking gun" memorandum ... but of course, by then, you are in the hole for a LOT of money and a LOT of time and a LOT of heartache.

And ultimately, even if you prevail, the only REAL winner will be your lawyers who will get a chunk of the ultimate judgment's value. As the lead plaintiff, you might get (depending on your state's laws) some token piece of the action - but trust me, there are so many "ifs" between you and that money you might as well go buy some lotto tickets with the $350 you were going to spend filing the complaint.

Now ... you do have another recourse for your own $40, and that is small claims court. In California, it costs $50 (I think) to file a small claims case, but I believe if you prevail you can get your costs from the opposition - so, you stand to gain all the money.

Here is the downside - lawyers cannot represent people in small claims court (at least in California). And this is only a $40 matter - so - in all liklihood, the insurance company may not even send anyone to the small claims hearing. This would likely result in you getting a default judgment (i.e. you "win").

Of course - so what? Now you have to collect. So you send a copy of your judgment to the insurance company for (best case scenario) $90 ($40 damages and $50 filing fee) or maybe $450 (if you have to sue them for the whole $400, plus filing fee). And then ... maybe ... they ignore you. You would then have to pursue collecting on the judgment, and that is no easy task in some cases.

So - whats the conclusion? Well, this is not legal advice, but in your position, I would demand the entire $400 in writing. If they refuse, I would probably just knuckle under and take the $360 because $40 just isn't a big enough deal to go to court over, even small claims court (unless I am just soooo freakin' mad I cannot contain myself).

Not too long ago I had a very similar situation - while I was parked, in a parking space, car turned off, a taxi-cab hit me. The taxi-driver wanted to settle out of court and off the record, but he offered me only about $600 and my body shop estimated the damage at $2300. So I said no and reported the incident to my insurance company who took up the matter with his insurance company. His insurance company came back with a "walk-away" offer (meaning we both just walk away) under the reasoning that we (taxi and I) had backed-up into each other - now, that excuse might have been reasonable (even if untrue) but ... the dent on my car was not on my back-end, but on my driver's side door! Unless my car drives side-ways (which it doesn't) I could not possibly have "backed into" the other guy.

My insurance company pointed this out, and, after 3 months, the other folks finally paid off on the whole thing. No court needed - just some letters and phone calls. And in your case, I think letters and phone calls are all its worth.

Just my opinion though.

mxlm · Post by **mxlm** » Tue Sep 25, 2007 9:59 pm

I think Mik's saying that since legal remedies are out of the question, you should pursue, ah, 'natural justice'.

Grand Fromage · Post by **Grand Fromage** » Tue Sep 25, 2007 10:58 pm

A tire iron would be a good start.

KnightLight · Post by **KnightLight** » Fri Sep 28, 2007 12:19 am

Yeah, but if I just let it go, is it on my record now that I'm partially responsible for an accident?
...wouldn't want my premiums to go up...

Mikayla · Post by **Mikayla** » Fri Sep 28, 2007 4:13 am

You can send them a letter denying any responsibility but accepting the $360 offer because its expedient. You could also offer to "settle" with them for $360 if they agree to drop any claim you were at fault. Before you do either, you might want to talk to your own insurance company and see what they have to say - find out if this would even matter to them. Usually insurance companies only jack up the rates if (a) you cost THEM money (i.e. your insurance company ends up paying) or (b) you get a ticket/citation from the cops. In short, another insurance company saying "your fault!" usually does not mean diddly-squat to YOUR insurance company unless it ends up costing them money.

But again, this is just my opinion off the top of my head.

Mulu · Post by **Mulu** » Fri Sep 28, 2007 6:52 pm

fluffmonster wrote:I would not be surprised if they are calculating precisely that you will decide $40 is not in fact worth it. Just think...if they do this to all their claims, that starts to add up to real money.

Welcome to the world of insurance. Yes, they do this or something similar to all their claims. The business of insurance is best described as "keeping their money."

There is one other option not yet mentioned, assuming you are in the U.S. Every state has an insurance commission board. If you take the letter the claims adjuster sent you, along with a statement from your auto mechanic that in fact your brake lights were in perfect working order, that becomes evidence of fraud which you can send along with a cover letter to your state's insurance commission board, and also send a copy to the black hat insurance company and your own insurance company. To be thorough I would also send a copy of all that to the claims aduster's supervisor. You won't actually get a remedy from all of this, but you will create a paper trail and at least you know you reported the SOB, and all it costs is your time and a little postage. This is of course assuming you have a mechanic's statement showing that your brake lights were in working order.

I remember when I got sideswiped on a bridge and ended up having to "total" my car, and the claims adjuster tried to bilk me by having my car's value reduced to about half blue book, even though it had previously been in good condition. I asked around and found out the insurance company was using a single source for all of their value estimates, in violation of state law. I threatened to report them, and lo and behold my car doubled in value.

Anymore the only way to get money from an insurance company due to an accident is to allege personal injury, unfortunately. By screwing people they only encourage frivolous claims.