Can an auto insurance company legally collect for unpaid premiums?
04.December, 2008
Here’s the situation: person sets up car insurance through an employee plan to automatically deduct from their paycheck. Goes on with life; insurance policy is in effect. Over a year later, gets a call from insurance company saying hey, whoops, we messed up and were actually billing someone else for your policy. You owe us a year and a half worth of premiums right now. Person didn’t realize because she assumed it was one of the many nonsensical acronyms being deducted from her paycheck. Is the insurance company legally entitled to recover this money from the person?
No, don’t pay them. Just switch companies. It’s their mistake, their problem. The only real issue is if you ever used the insurance on a claim or not? If you did, than you would be liable for the premium or the damages. If no claims were paid out, than it’s a wash. Insurance is for peace of mind sake and to satisify the BMV laws. You have to have coverage according to law which means if you get a random letter asking for proof of coverage, you must show you had coverage for the dates they are requesting. I just got one yesterday and they want proof from the Nov 09 period through now. That’s what you really have to worry about, so go out and get some coverage. I have Allstate, they have always done me right price and service (and yes I’ve had claims). But who would go back and pay a year and a half premiums for an insurance companys mistake. I would never do it. Insurance bebenfits are not tangible unless they paid something. So in reality, you have not had coverage for the past year and a half. Oh well, good thing nothing happened? Now get some coverage from another company and make sure your premiums are paid. As for your present company, I would offer to pay them for the current quarter. My billing period and new ID cards take affect every quarter. So that’s why I mention that. If they can’t accept that, too bad! They want to get nasty, talk to a lawyer. I am sure he would say dont pay it also! Good luck to you!
03.December, 2008 um 6:48 am
personally I would think their mistake their problem. legally I would guess you have to pay
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03.December, 2008 um 6:48 am
If I get this correct - they deducted your premiums from someone elses pay check, so you did not pay for the services rendered.
Yes, they can collect the unpaid premiums. You say the other person didn’t know they were being deducted and you didn’t pay them so the first person gets a refund, and you have to pay. There is no such thing as a free ride.
How could you not know you weren’t paying your premiums?
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03.December, 2008 um 6:56 am
No, don’t pay them. Just switch companies. It’s their mistake, their problem. The only real issue is if you ever used the insurance on a claim or not? If you did, than you would be liable for the premium or the damages. If no claims were paid out, than it’s a wash. Insurance is for peace of mind sake and to satisify the BMV laws. You have to have coverage according to law which means if you get a random letter asking for proof of coverage, you must show you had coverage for the dates they are requesting. I just got one yesterday and they want proof from the Nov 09 period through now. That’s what you really have to worry about, so go out and get some coverage. I have Allstate, they have always done me right price and service (and yes I’ve had claims). But who would go back and pay a year and a half premiums for an insurance companys mistake. I would never do it. Insurance bebenfits are not tangible unless they paid something. So in reality, you have not had coverage for the past year and a half. Oh well, good thing nothing happened? Now get some coverage from another company and make sure your premiums are paid. As for your present company, I would offer to pay them for the current quarter. My billing period and new ID cards take affect every quarter. So that’s why I mention that. If they can’t accept that, too bad! They want to get nasty, talk to a lawyer. I am sure he would say dont pay it also! Good luck to you!
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