Change of Cash Settlement - What to Do Under Insurance Law?

[eva13]

I was in a car accident and my insurer deemed that I wasn't at fault and agreed to pay a cash settlement amount for the damages because I was leaving the country. I received an email confirming that the excess was waived.

A couple of weeks later I received the payment remittance advice and to my surprise the insurer deducted $700 from the settlement amount. When I called the customer service I was advised that the decision was changed based on the statement from the other driver.

I wasn't notified at any point of this change and also the insurer didn't request any statement from me.

Is there anything I can do under Insurance Law?

 

[Zerojay]

Terrible customer service from your insurer. Stating the obvious, they should not have advised you the excess was waived if they had any doubt about who was at fault. Then if changing their minds they should have rung you, apologised for their mistake, and fully explained what has changed, giving you the opportunity to review the new information (the other driver’s statement) and provide your counter arguments. To just send out a reduced payment with no explanation shows a complete absence of caring.

I am not qualified to give any advice about contract law so this is just my opinion based on a little bit of knowledge -if the original settlement amount was negotiated with you and agreed to by you then you can hold them to it. However if the amount was just advised, with no negotiation between you, then I think the insurer can correct the amount if an error has been made. Someone who is qualified needs to verify/correct me on this point.

Suggest you write to your insurer, stating you are disputing their decision and also wish to complain about bad customer service. Request that they put in writing the reasons they are relying on and provide you with a copy of the other driver’s statement for your response. Suggest you advise you want to go through their internal disputes process and ultimately progress to the external Ombudsman if you are not happy with the outcome.

Please post your accident description and the other driver’s statement when it is available. Good luck.

I do not give legal advice, just my opinion based on working for an insurance company for over 20 years.

 

[eva13]

After I complained the insurance company amended their decision to contributory negligence from both drivers. They have apologised for not notifying me and offered to reimburse 50% of my excess. I have accepted the offer. I guess it's better than not getting anything back at all but it was a frustrating process.