Insurance Helpline With cedric Stephens

Question: A taxi ran into the back of my car in July of last year. The accident was reported to the police and my insurers. I had to pay an excess. I was supposed to be paid for loss of use.

My car was parked after the accident for about a month. Now they only want to pay me for the time it was at the garage and that is four days. My premium has gone up.

I am trying to get back the money for the loss of use and the excess. Why am I being penalised for an accident I did not cause by paying a bigger premium? I want to move but can't until I get back some of my money. What are my options?

- las_lindo@yahoo.com

Answer: Your case is similar to hundreds that I have written about since this column began nearly 11 years ago. With all of the changes over these years, some things still remain the same. Persons like you end up being asked to bear the cost of the lack of care by others.

This is a form of economic injustice. Insurance companies are, unfortunately, often part of the problem.

Your insurers seem more anxious to increase your premium than in making a claim against the taxi's insurers. Why is this so? Could this be because the taxi's insurance was invalid or the accident was not reported by the other driver? I suspect that you are not getting the full story.

If the taxi's insurance was not in force at the time of the accident, your best option would be to file a claim directly against the owner/driver for your excess and loss of use. Contact the clerk of court at the court nearest to you to find out more about this process. What costs would be involved and how long would it take to recover funds from the other driver? Don't expect any help from your insurers. They discharged their duty under the policy when they paid part of the repair bill for your car. Comprehensive policies like yours exclude loss-of-use expenses. The same applies to the excess or deductible.

These costs should be paid by the other driver or his insurers.

LOSS OF USE LIMITED

Ask your insurers if the taxi driver reported the accident to his insurers. If he did, why are you still out of pocket? If this was not done, you have 'gone clear!' You now have the chance to show up your insurer's claims staff ignoramuses.

Many persons who handle claims are ignorant about the motor-insurance law. They do not know that insurers cannot legally refuse to pay a claim where the insured driver has not reported an accident. Refer them to Section 8 of The Motor-Vehicles Insurance (Third-Party Risks) Act. It allows victims like you to recover loss-of-use expenses, the excess, money your insurers paid to fix your car and other expenses from the taxi driver's insurance.

Loss of use is limited to "reasonable and necessary expenses for the time that is necessary to repair or replace the motor vehicle." If it was parked while awaiting the purchase and delivery of parts, loss-of-use charges would be restricted to the time that was necessary to complete repairs. If the repairs were done in four days, you would not be paid for 30 days' loss of use.

SHOP AROUND

Your decision to remain with your existing insurers should be based on what they are offering as compared to what is available from other insurers.

The accident was clearly not your fault. Ask your brokers to get quotations from other insurers. If the claim you filed last July was the only one during the last three years, you could be in for a very pleasant surprise.

Even if you do not recover your loss expenses and excess, it is quite possible that by switching companies, you could end up paying less premiums. Other insurers may consider you to be a good risk. Do not be afraid to play the market.

Cedric E. Stephens provides independent information and advice about risk and insurance. For free information or counsel, email Mr Stephens: aegis@cwjamaica.com