How long does it typically take for an insurance company to determine if a policy is valid?

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How long does it typically take for an insurance company to determine if a policy is valid?

I was recently in an automobile accident. The driver of the other vehicle was cited for failure to stop at a stop sign. There were two witnesses to this accident and they both confirmed that the other driver did not stop at the stop sign. When I contacted the driver’s insurance company to file the claim they informed me that her policy may or not be valid but they gave me the contact info for the agent was being assigned to this claim. After unsuccessful attempts of calling this agent I called the drivers insurance company again and after a few stern words the agent finally contacted me. She told me that the other drivers policy status was under investigation and she could not tell me at this time if the driver had a valid policy. The agent proceeded to let me know that she had no idea when they would know if the policy was valid. She said it could be weeks but no matter how hard I tried to get a direct answer she insisted that she could not give me any sort of timeframe whatsoever. This sounds really shady to me. Is this normal? Should I be perusing legal action on this insurance company? I have read the customer complaints regarding this company and they all describe a similar shady experience with this company.

Asked on December 16, 2011 under Accident Law, North Carolina

Answers:

L.P., Member, Pennsylvania and New Jersey Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Thank you for your question regarding the determination of whether or not an insurance policy is valid.  Insurance policies can differ depending on the insurance company that wrote the policy, and it can differ depending on the state law.  Even though another driver may be at-fault for your automobile accident, that does not mean that their insurance company will easily pay for the accident, or pay for the accident at all.

Most insurance companies have polices that require them to speak with their named insured on the insurance policy before paying out on an insurance claim.  The insurance company may be contractually obligated to speak to the named insured to verify the details of the accident and confirm who was driving the insured vehicle.  However, in most states you have the right to go through your own insurance company to pay for the damage to your vehicle, and then your insurance company can subrogate (collect) from the other driver’s insurance company for any money that they paid out. 

It may appear that the other insurance company is almost “getting away” with something, but the other driver will most likely be penalized for not cooperating with their insurance company for an automobile accident.  Additionally, your own insurance company can attempt to contact the other driver to get this matter resolved. 

Also, you could consider contacting the insurance commissioner in your state.  While the other insurance company has contractual obligations to their insured, they are unlikely permitted under state law to ignore you for an indefinite period of time.  You can contact your state’s insurance commissioner to let them know how this particular insurance company has handled your claim.

 


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