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ARE THERE ANY SPECIFIC TIME LIMITS
FOR AN INSURANCE COMPANY TO PAY FOR COLLISION
OR COMPREHENSIVE CLAIMS?
There are no specific time limits for the settlement
of claims. Insurance companies are required by
law to pay all claims in a prompt and reasonable
amount of time. However, what constitutes "prompt
and reasonable" may vary from claim to claim.
Claims that require special or extended investigation
may take longer to resolve. Inclement weather
conditions often cause an increase in the number
of claims filed and that can slow the process
down as well.
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MY AUTO WAS DECLARED A TOTAL LOSS
BECAUSE OF AN ACCIDENT. IS MY COMPANY REQUIRED
TO GIVE ME THE REPLACEMENT COST?
When your auto is declared a total loss, unless
you made special arrangements and paid an additional
premium, your insurance company will only pay
you the actual cash value of the auto as of the
date of the loss, not the cost to replace it.
Your auto's value is determined by the following
factors: the retail value for an auto of like
kind and quality prior to the accident; the price
paid for the auto plus the value of prior improvements
to the auto at the time of the accident; the decrease
in value of the auto resulting from prior unrelated
damage which is detected by the appraiser or for
which a claim has been paid; and the actual purchase
cost of an available auto of like kind and quality.
If your auto has substantial value because of
its exceptional condition such as an antique,
classic, or restored auto, you should have it
appraised and then insure it for the appraised
value.
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DO I HAVE TO PAY AN INSURANCE PREMIUM
AFTER MY AUTO IS DECLARED A TOTAL LOSS?
Yes, the auto is considered insured until the
policyholder returns the license plates to the
Registry of Motor Vehicles. If you don't have
your license plate because your auto was stolen
or because your auto and plates were burned in
a fire, then you have to go the nearest Registry
of Motor Vehicles office and obtain a lost or
stolen plate(s) receipt and use that instead.
You must give this receipt to your insurance company
in order to cancel your policy and avoid paying
any additional premium.
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MAY I KEEP MY AUTO IF I HAVE A
COLLISION, LIMITED COLLISION OR COMPREHENSIVE
CLAIM AND MY INSURANCE COMPANY DECLARES IT A TOTAL
LOSS?
No, your insurance company has the option to
take title to your auto because it is entitled
to any salvage value your auto may have. You can,
of course, negotiate with your company to purchase
your auto for the agreed salvage value.
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THE BODY SHOP IS REPAIRING MY AUTO
AFTER AN INSURED LOSS. WILL MY INSURANCE COMPANY
PAY FOR USED OR NEW PARTS?
If the repair of the damaged part impairs the
operational safety of the auto, then the insurance
company will pay to replace it with a new part.
But, for non-safety parts, unless your claim occurs
during the first year after your car was manufactured,
you are not entitled to new ones. State regulation
allows for the replacement of damaged parts with
used or reconditioned parts as long as they are
of like kind and quality. This means that a three-year
old door will not get replaced by a brand new
one. You can insist on new parts, but you will
have to pay the difference in cost.
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AN OBJECT DAMAGED MY WINDSHIELD
AND I AM UNABLE TO DETERMINE WHERE IT CAME FROM.
AM I COVERED FOR THIS LOSS?
Yes, if you have comprehensive insurance you
are covered for the full amount of the loss, unless
you opted for a $100 deductible for glass breakage.
The $300, $500, or $1000 deductible, or whatever
you may have selected for comprehensive coverage,
does not apply to a glass loss.
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CAN MY INSURANCE COMPANY DENY A
CLAIM FOR DAMAGES TO MY AUTO IF THE PRINCIPAL
PLACE OF GARAGING LISTED ON MY APPLICATION IS
FALSE?
Yes. If you or someone on your behalf gives
false, deceptive, misleading or incomplete information
in any application and if such information increases
the insurance company's risk of loss, then your
company may refuse to pay claims under any or
all of the Optional Insurance Parts of the policy.
Such information includes the description and
place of garaging of the vehicles to be insured,
the names of the operators required to be listed
and the answers given for all listed operators.
In the event that you have moved since you filled
out your initial application, promptly notify
your insurance company and the Registry
of Motor Vehicles of your new address.
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IS MY INSURANCE COMPANY REQUIRED
TO NOTIFY ME OF ITS DECISION TO CANCEL MY POLICY?
Yes. Your company must send you a notice at
least 20 days prior to the effective date of the
cancellation. A notice sent by regular mail with
a certificate of mailing receipt obtained from
the Post Office is considered sufficient. A certified
or registered mail with a return receipt is no
longer required.
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WHAT CAN I DO IF I ACTUALLY RECEIVE
A CANCELLATION NOTICE?
You can pay the exact amount called for on the
notice or, if you feel that the cancellation is
unjust, you may submit a written complaint to
the Board of Appeals at 470 Atlantic Avenue, Boston
02210-2223. This must be done prior to the effective
date of cancellation.
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WHO IS LIABLE FOR THE STORAGE
CHARGES ON MY DAMAGED AUTO WHEN THERE IS A DISPUTE
AS TO THE AMOUNT OF THE CLAIM PAYMENT?
The insurance company is responsible for paying
storage charges until it makes a reasonable offer
to settle the claim. However, if the consumer
disputes the amount offered and the company revises
its offer, this does not necessarily mean that
the original offer was unreasonable. Disputes
over what is reasonable can be resolved with your
company through the process described in your
insurance policy. You can also submit a written
complaint to the Division of Insurance if you
are unable to settle the dispute.
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MAY AN INSURANCE COMPANY REQUEST
A DOWN PAYMENT IN ADVANCE WHEN I PURCHASE OR RENEW
AN AUTO INSURANCE POLICY? AND IS IT POSSIBLE TO
PAY MY PREMIUM MONTHLY??
Your insurance company may request up to a 30
percent down payment of the annual premium prior
to the renewal or issuance of your policy. Most
companies do offer a monthly type payment plan
for the balance of the premium or something similar.
You should check with your company to see what
options are available to you.
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IF I OWN AN AUTO WITH COLLISION
AND COMPREHENSIVE COVERAGE, WILL MY INSURANCE
APPLY TO THE RENTAL OF ANOTHER PRIVATE PASSENGER
AUTO?
Yes, however there may be substantial limitations.
Your collision and comprehensive insurance are
transferable to a substitute rented or borrowed
private passenger auto that is damaged while it
is being operated by you and by members of your
household.
Many auto rental companies require that you reimburse
them for the REPLACEMENT COST (RC) of any damages
incurred to their vehicle. Your auto policy
only provides for ACTUAL CASH VALUE (ACV) coverage,
minus the deductible. ACV is equal to Replacement
Cost minus depreciation. Since your Collision/Comprehensive
coverages are on an ACV basis, you can be held
liable for the Depreciation amount, plus, of course,
the deductible.
Also, the insurance company will calculate the
value of your covered vehicle in the amount they
offer for coverage of a damaged rental vehicle.
If you own a five year old compact car, you cannot
expect the insurance company to reimburse a rental
company for a brand new top of the line SUV or
Sedan you may be renting. You will be held
responsible for the difference, which could be
quite substantial. Also, the rental company
will most likely expect you to pay their full
rental fee for any period of time their vehicle
is undergoing repairs. Unless you have Substitute
Transportation coverage, you will be held responsible
for these costs. If you have Substitute
Transportation, the insurance company will pay
up to your daily limit for rental coverage as
determined by a company adjuster. This amount
may be less than the actual rental cost, and the
rental company may decide the car is not driveable
for a longer period than the company adjuster,
leaving you once again responsible for the shortfall.
There is no coverage under your policy for family
friends or significant others. You should be aware
that your coverage is available only if you rent
or borrow a private passenger auto in the United
States or Canada.
You should also be aware that your policy does
not provide coverage for borrowed or rented trucks.
If you are renting a truck, you should check with
the rental company regarding the purchase of collision
and comprehensive insurance. If you are borrowing
a truck, make sure you determine whether or not
the owner has purchased collision or comprehensive
coverage. If the owner does not have insurance,
you may be personally liable for any damage to
that truck which is the result of your negligent
operation. Last, if the use is for business rather
than pleasure, call your agent first. Business
use is usually not automatically covered. In any
event, remember that the coverage is for what
is basically a substitute vehicle, not an additional
one.
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