On Apr 29, 7:13 am, Stan Brown <the_stan_br...@fastmail.fm> wrote:
> Sat, 28 Apr 2007 07:23:09 -0400 from David Martel <marte005
> @earthlink.net>:
> > Why they failed to collect your deductible as part of the law suit is
> > strange.
They _didn't_ fail to collect his deductible; where do you think the $550 they paid to OP came from? It was less than full value, but that's what usually happens in any settlement.
> Is it merely strange, or is it actionable? Is the company free to
> settle for less than the deductible without the policyholder's
> consent?
They are, if the policy gives them that right. OP consented by contract, before the crash even happened, by his act of accepting the policy language and benefits and paying the premiums to keep it in force, even if he never "signed anything".
> Of if the company settles for more than the deductible,
> doesn't the policyholder have to be paid first?
In most states AFAIK it's the other way around. In a subrogation context, the insurer is an indemnitor in both senses of the word: they are paying their insured for a debt that rightfully should have been paid by another (the uninsured tortfeasor), and they are paying their insured for that damage to hold him harmless from the loss TO THE EXTENT it exceeds his deductible.
As an innocent indemnitor, the insurer thus has the primary right to full reimbursement from any recovery they may get from that responsible third party (the uninsured driver) before they owe a penny of it back to their own insured driver. Looking at it another way, when "bad stuff" happens to an insured who has a deductible provision in his first party coverage (e.g. the collision damage coverage), the insurer's duty to indemnify their insured for that loss kicks in only AFTER, and on top of, the insured having put up the full amount of his deductible toward that loss.
Requiring the insurer to reimburse the deductible FIRST, before the insurer is made whole, would essentially render the deductible provision meaningless in most cases. The bottom line is, anyone who has such a policy (as most of us do) should consider that his deductible is "gone with the wind" before he gets a penny from his insurance company, and should look upon any recovery of any portion of that deductible at all as a lucky chance, not an entitlement. If he doesn't like that arrangement, he should pay the higher premium it usually takes to get a lower deductible.
> I agree there's no claim against the other party or the other
> insurance company, but what about the OP's own insurance company? At
> least I'd think the OP would be entitled to an accounting, but maybe
> I'm wrong.
I agree he's entitled to an accounting from his insurance company of the full details of the settlement. If the insurer does not convince him they were dealing fairly with him, he can complain to the state insurance commissioner.
--
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Mike Jacobs
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