Accident in leased vehicle - help

[rangertjsc]

Leased a car and got into an accident. accident was ruled my fault as i slid off a road during bad weather. Thought I had all the required insurances per the lease agreement, but come to find out my agent gave me the short stick and put down for limited collision insurance. Its a long story on how I got switched to limited collision without my knowledge but it happened and insurance company won't pay for damages. Am I liable for all the damages at this point or is my agency liable for writing a policy insufficient to lease agreement. To complicate it further, my agency has since closed so I am stuck.

What are my options?

 

[VolAgent]

The short answer, it sounds like you are stuck.

First you would need to get a hold of the signed application for the insurance and see what it lists as coverages. Does it match the coverages you have, were the coverages changed after issue? If they were changed, is there a signed form for the change?

Also, did you give the agent a copy of the lease agreement or insurance requirements for the leasor? If not, how was he supposed to know the requirements? If you did, did he ever state either verbally or in writing that the insurance met all requirements?

And assuming that you can find evidence that the agent is liable, are you able to find the agent and go after them for his or her error? Do they have insurance or assets to satisfy any judgement? Is the case even worth pursuing, will an attorney take it on contingency or are you willing to pay the attorney to go after the agent?

So yes, the short answer is you are probably stuck paying it yourself

 

[InsCommentary]

Who is the insurer and what is "limited collision" coverage, coverage only for owned autos?

 

[adjusterjack]

my agent gave me the short stick and put down for limited collision insurance

"Limited Collision" in Massachusetts is a lower priced collision coverage that provides coverage on the car if another driver is identifiable and the insured is less than 50% at fault.

That's why your insurance isn't paying for your car.

Its a long story on how I got switched to limited collision without my knowledge

VolAgent alludes to the possibility of the agent being liable. That's an interesting proposition as Massachusetts courts have long ruled that an insured has the responsibility of understanding his coverage.

So, please, tell us the "long story" about how this "Limited Collision" happened without your knowledge.

my agency has since closed so I am stuck.

If it turns out that your agent has some liability it wouldn't matter if the agency is closed as long as he is still alive to be sued if necessary.

The question of agent liability still needs to be addressed.

Meantime, you need to figure out how to pay the leasing company.

 

[VolAgent]

VolAgent alludes to the possibility of the agent being liable. That's an interesting proposition as Massachusetts courts have long ruled that an insured has the responsibility of understanding his coverage.

So, please, tell us the "long story" about how this "Limited Collision" happened without your knowledge.

Whoa... I'm not saying the agent is liable, I am mentioning a couple of ways in which the agent could be liable. Basically by altering coverage without the insured's permission, extremely unlikely, or having stated the coverage met the requirements for the lease program when it did not, possible but hard to prove.

I stand by my short answer, the OP is probably stuck with this one. Even if he or she could prove the agent liable, they will now need to also find them and hope there is a pocket deep enough to pay. Also, depending on the damages that means successfully winning in small claims court or finding an attorney willing to take the case.

 

[adjusterjack]

Whoa...I'm not saying the agent is liable, I am mentioning a couple of ways in which the agent could be liable

That's what "alludes to the possibility" means. Nothing to "whoa" about.

I agree that there is a "possibility" of agent liability. There is also the "possibility" of the insured's own responsibility for not getting the proper coverage.

I'm hoping the OP comes back with the "long story."

 

[VolAgent]

That's what "alludes to the possibility" means. Nothing to "whoa" about.

I agree that there is a "possibility" of agent liability. There is also the "possibility" of the insured's own responsibility for not getting the proper coverage.

I'm hoping the OP comes back with the "long story."

My bet is always on the OP's screw up, but I like to be nice and lay out the other side.

 

[rangertjsc]

I can go into detail as much as anyone wants. There are a few things I want to point out.

Originally my previous agency wanted 6k to insure the car when I first leased it, July 2016. I have no prior accidents, only a speeding ticket so I thought that was ridiculous. I brought the exact policy I was on from Safety Insurance to a different agency. Note: this policy was a personal policy at this time.

Get to the 2nd agency and ask them to give me the same as coverage as the current policy because I knew I had the BMW lease coverage minimums. Only difference here is I asked for a business policy because I am a business owner and thought it would be fine to put it under my company name. They say no problem and write me the policy. Comes back at 1600-1700 dollars premium. At the time, I had the policy checked out because I thought this is way too good to be true. Had a lawyer friend look at it and he didn't see any issues. I thought great, lets move forward.

2 months go by (now september) and my new agency calls me up and says Safety has to cancel the policy because the car is not registered under my company, it was under my personal name. I said okay, why was this not brought to my attention before? Agent replies with we didn't catch it or didn't think it mattered. Should have raised red flags in my mind right there. Anyways, I said okay give me a new policy. It came back as a Commerce (MAPFRE) policy. It was 1800 dollars premium and I thought, okay makes sense this one was a little more expensive or they would have offered it first. I asked if its the same policy, my understanding was, yes, its the same policy. What they claim to this day is that they told me that this new commerce policy, even though more expensive than the Safety policy with full collision coverage, had limited collision coverage and I waived the full collision. Going back to when they presented the new commerce policy, I didn't see any problems because I was not aware of the limited collision at that time. I signed it and the policy went into effect with my deposit.

Fast forward to january. On my way home from work and it began to snow. I knew conditions were bad so I took it slow but must have found black ice because before I knew it, my car was sideways slipping off the road. I got the car corrected to the right direction but by that time it was too late. I looked up and saw a telephone pole directly in front of me. Slid right into it doing about 15 to 20 mph. I was fine, climbed right out.

It was a saturday so I did not speak with my agent regarding the accident till monday. Called them, they filed the claim that day. Next day they let me know Commerce has the claim and that I am all set, I am covered. Week or two goes by and I hear from the the Claim reviewer at Commerce. They said no, you are not covered. You only have limited collision on the policy and you are more than 50% at fault. I said how can that be and immediately call my agency. They say we will figure out what happened.

Hear back a day later and they're like, yeah you only have limited collision and I lose it. I went back and forth for weeks trying to explain that were was some mistake, one agent over there offered to work for me to work off what a mistake it was. He said he would offer money but he didn't have it.

I then decided to submit a complaint to the MA board of insurance. Gave them only the facts that I had, payments and receipts. A year later, I am still making payments on the car its crashed form and I get a response from the board. Typical response saying that I waived my full collision insurance and its my fault for not noticing. They provided the agency's response to the complaint. It was written by the agency owner who I never met.

And here we are today. currently stuck with 25k worth of damage and agency closed.

 

[VolAgent]

I stick with my short answer, you're stuck. In fact, you're more stuck.

I could really try to break it down, but the fact that your complaint was dismissed by the Board of Insurance is going to be a high bar to overcome in any attempt to sue the agency and recover, assuming there are any assets or insurance to even go after.

If you want to pursue it, at this point it is time to consult with an attorney.

 

[adjusterjack]

I agree. You are stuck.

I asked if its the same policy, my understanding was, yes, its the same policy.

"My understanding" means "I'm just guessing, I don't really know." You obviously didn't check out that policy or you would have seen "limited collision" instead of "collision."

Going back to when they presented the new commerce policy, I didn't see any problems because I was not aware of the limited collision at that time.

Because you didn't look.

I signed it

Signed what? Do you know what you signed? Did you read it? Did you keep a copy? Did it say "limited collision"?

A year later, I am still making payments on the car its crashed form and I get a response from the board. Typical response saying that I waived my full collision insurance and its my fault for not noticing.

That's not only correct but the requirement that an insured understand his insurance has been routinely upheld by appellate court rulings in Massachusetts.

"Although an insured is entitled to rely on his broker as his agent, an insured cannot abandon all responsibility for ascertaining the terms of the coverage his broker obtained. See Kap-Pel Fabrics, Inc. v. R.B. Jones & Sons, supra at 58. See also First Nat'l Ins. Agency, Inc. v. Leesburg Transfer & Storage, Inc., 139 So.2d 476, 480-481 (Fla. Dist. Ct. App. 1962). In appropriate circumstances, an insured may be estopped from recovering against a broker on an oral contract when a written policy does not comply with the parties' oral agreement. The existence of estoppel, however, generally is a question of fact, see Quality Fin. Co. v. Hurley, 337 Mass. 150, 155 (1958); Capozzi's Case, 4 Mass. App. Ct. 342, 347 (1976), that depends on all the circumstances of the transaction, such as the nature of the relationship between broker and the insured, the reasonableness of the parties' conduct, and the insured's sophistication and experience. Cf. John Hancock Mut. Life Ins. Co. v. Schwarzer, 354 Mass. 327 (1968)."

Quoted from:

https://scholar.google.com/scholar_...0&q=simon+v.+national+union&hl=en&as_sdt=4,22

Here's another where the judgment went in favor of the broker:

https://scholar.google.com/scholar_...8&q=simon+v.+national+union&hl=en&as_sdt=4,22

And yet another in favor of the insurance company:

https://scholar.google.com/scholar_...9&q=simon+v.+national+union&hl=en&as_sdt=4,22

The worst part of all this is that you are a businessman. You even had a lawyer look over one of the policies. You would be charged with a greater responsibility to understand your insurance than the average insurance buying customer.