When an auto insurance policy is cancelled, is the insurance company legally responsible for notifying the loss payee?

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When an auto insurance policy is cancelled, is the insurance company legally responsible for notifying the loss payee?

A car covered on my insurance policy was wrecked and probably totalled. My current insurer says that we do not have collision coverage and therefore, they will not be sending an adjustor to see the car and will not be paying anything. Was my previous insurance company legally responsible for notifying the loss payees (lenders) when I cancelled that prior policy? There are 2 cars are on my policy and neither of our lenders were notified when that policy cancelled. Therefore, they, nor I, knew that we did not have the proper insurance coverage on our vehicles.

Asked on August 23, 2012 under Accident Law, North Carolina

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

No, your insurer is not obligated for informing your loss payees when you cancel your insurance. You, as the policy holder (and the person who evidently did the cancelling) bear the responsibility to notify any other interested parties, including loss payess.


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