deductible waiver issue

by Joe
(Redding Ca)

My wife was involved in a unattended rollaway accident where the owner of the other car was found at fault. His company is Progressive and they say the accident is under investigation. I did some digging and found out that his coverage is in question.

We have UIM with a collision waiver and decided to use our own company. Farmer’s states in Calif. it is a law that we have to pay the deductible. What they stated is when it is determined that there was a lack of coverage they will reimburse the deductible.

Is this a normal or am I being mis informed??

Thanks, Joe

Answer:

You got something call a “drawer answer”. The adjuster probably just wanted to get you of the phone, and the easiest way to this is by telling you that is the law. What law? What statute? Where exactly it says that you must pay a deductible before they provide coverage for the deductible? Simple, there is NO STATUTE IN ANY STATE THAT WILL REQUIRE YOU TO PAY A DEDUCTIBLE FIRST. Sorry for the caps, did not mean to yell.

Think about it, if that was true, then a deductible waiver policy would not be consistent with the law. They would be selling you an illegal policy. The coverage that you are paying for is being denied by the law. So, we believe that you have been misinformed as far as what the law is.

Usually, the terms of a UIM or UMPD coverage require that the “non-coverage” of any other policy (the person’s that hit you) will be confirmed. In your case, your insurance company will not be satisfy until they have a letter from the other guy’s insurance company stating that they are denying coverage. This will trigger your deductible waiver.

As they mentioned, by the time this happens your car is probably fixed or damages are being taken car, so you already paid a deductible. They will send your deductible back or pay it directly to the body shop. This is the “normal” procedure. The insurance company is making sure they are not paying for something they do not owe, per the terms of the policy. It does not have anything to do with what California Law has to say about this subject.

You can always ask them to put the pertinent statute in writing.

Good Luck,
Casey.