Expert: Bennie719 - 2/8/2008

Question
My sister bought a new car with cash and shortly after, she wrecked the car only to find out that she did not have collision insurance on the car.  This was a misunderstanding between the ins company and her.  There are 4 other cars on the policy, all with full coverage/collision.  Should there have been a form signed for her to accept responsibility for under insuring her car?  The policy has been open for 35 years with almost ALL cars on the policy having collision.  The only cars that ever did not have collision were old beater cars with minimal value.  My question is:  should the insurance company have made her sign a paper to decline collision coverage?  Thank you very much.

Answer
Hi Mike,
Although the insurance company is not required to have an insured client sign any kind of document when they decline collision coverage, the person that added the new car to the policy was looking at at your sisters file and was fully aware that all other cars carried collision.  That person had an obligation to thoroughly discuss collision coverage with your sister to ascertain that she thoroughly understood that she should carry collision on the new car and completely understood that no such coverage was being put on the new car.
This should be appealed to persons of high authority within the company.  If the company fails to resolve the situation, then your sister needs to file a complaint with the state department of insurance.  Their website can be found by typing
'yourhomestatename department of insurance' into your web browser and hitting go.
I hope this has been of help.
Your feedback by rating my answer will be appreciated.
Sincerely,
Bennie
San Francisco Bay Area