Too late

by Walter Olson on April 23, 2010

Sorry, says the West Virginia high court, but renewing your lapsed auto insurance policy the day after your crash won’t fly [WV Record] The decision reversed a lower court ruling ordering Progressive Insurance to pay the claim, which had been filed not by the driver but by a bank and car dealer.

{ 4 comments }

1 Richard Nieporent 04.23.10 at 8:02 am

I don’t see why they refused to cover the claim. After all, the new health care bill allows individuals to get coverage for existing conditions.

2 No Name Guy 04.23.10 at 8:57 am

What part of expired didn’t the lower court get? That it even got to that stage is amazing. Their contractual obligation ceased the minute the policy lapsed.

3 VMS 04.23.10 at 11:35 am

In New York, an insurance company is on the hook for coverage even for nonpayment of the premium until it sends a notice of cancellation to the DMV. Needless to say insurance companies electronically notify DMV of all lapses at 11:59 PM on the last day of coverage. In response, DMV immediately cancels the vehicle registration for lack of insurance. New York’s system effects a verifiable bright line rule as to when a vehicle is ensured in the state. Given enough time, I’m sure there will be accidents involving lapsed policies occurring between 11:55 PM and 12:05 AM where there will be some question as to when the accident actually occurred and whether the vehicle was insured at that time.

In any event, public policy dictates that every vehicle driven on the highways have minimum insurance for the purpose of protecting those not in privity with the vehicle owner. The car dealer and the bank had every opportunity to ensure that the premiums were paid on time. For example, mortgagees routinely establish an escrow fund to pay the taxes and fire insurance on the property. They do not rely on the homeowner to make these payments because doing so may jeopardize their security and the property.

4 Dave Lincoln 04.24.10 at 4:28 pm

“…. but renewing your lapsed auto insurance policy the day after your crash won’t fly.”

Is that wrong? I gotta plead ignorance here. I mean, when I look deep into my soul, this reminds me of the way I renew my homeowners insurance. I feel I may have done something un-green, but I don’t know. Here’s what I do – you tell me if this is not cool or whatever:

I cancel my insurance and get my remaining premium back each year when hurricane season ends, basically by early November. Of course, I have to be careful not to burn the house down with use of the fireplace, but I’ve learned not to use too much corrugate to get it lit and don’t burn so much pine and sycamore (any more).

Then, if there is no global warming, which induces a strong hurricane season in the Atlantic and Gulf, such as the last five years or so (hence, I guess we have global nothingness), I don’t renew. HOWEVER, if I do see a category 4 or above storm with it’s eye less than 50 miles from the coastline of my state on the radar, and I also see many Big-Media communication vans parked in my neighborhood, I mosey on down to State Farm to take care of some bidness.

The only problem is when this happens on a weekend. In that case, what can you do, right? Me, I hope Obama will save me and my young uns from our misery and our pre-existing mental conditions.

;-)

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