To what extent can my insurance company limit payments made on my total loss car claim if they are acting in subrogation for me against another insurer?

UPDATED: Oct 1, 2022

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To what extent can my insurance company limit payments made on my total loss car claim if they are acting in subrogation for me against another insurer?

My car was rear-ended on April 6. Gieco declared it a total loss on may 1 told me on may 2 I would have to file with my insurance and they would subrogate the claim with gieco after. Allstate took 2 months insisting the car be torn completely down days after geico had told body shop the car was totaled and thought the claim finished which took 2 1/2 weeks to get the car back inside to tear apart with having other cars ahead of mine, insuring the car wasnt totaled, then totaling the car finally the end of June to finally toTal the car and is now saying they won’t pay the storage fees accrued while they were doing all this. They’ve told me that I will have to pay over half of the fees. Can they do this? I know gieco has already sent them a check for $12,454 and et they are dragging their feet over $1600 in storage. What I can do? I have also submitted a complaint with the NCDOI and am waiting to hear back from them.

Asked on July 10, 2018 under Insurance Law, North Carolina


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

They cannot impose charges or costs on you that result from *their* actions--e.g. their delays in acting, causing storage charges to mount up. If necessary, you can sue them for the fees based on breach of the "implied covenant of good faith and fair dealing." Every contract--and an insurance policy is a contract--comes with an obligation imposed by law that the parties to the contract (e.g. the insurer) will act in "good faith" towards the other parties (e.g. you) to the contract and not do things which damage or impair the value to the other side of the contract. You have insurance to pay costs and losses for you: delaying resolution so as to increase the charges, then refusing to pay those charges, is to act in bad faith and violate that covenant.

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