Expert: Charlie Barone - 3/23/2009

Question
Hello,

I was involved in an auto insurance accident this morning that was my fault (slid off road from icy road conditions and hit a fence). No other vehicles were involved. I was in another accident last week that was not my fault so my car is in the shop and I have a rental. The company I was renting from is where I originally purchased my car and am having it fixed. I called my insurance company this morning and was told that my policy was automatically cancelled from a payment that I was not aware that was 2 weeks late. They tried to take the payment out on the 1st of the month and I was not aware that it did not go through until today. I was told that they tried to take it out again on the 5th of the month without any form of notification or written letter from Geico or my bank. I paid the remainder of my balance owed for this month, but they told me that I had to start up a new policy and that this accident would not be covered even if I did start up a new policy. The only letter that I received was yesterday stating that my policy was cancelled on the 20th... with it now being Monday the 22nd. I just spoke to a supervisor, and there is absolutely NOTHING they are going to do for me. They told me to re-sign up with Geico!

Unbelievable!

Answer
Insurance policies are very strict when it comes to payment and companies will do anything they can to avoid paying a claim. At least you have coverage for the first accident that was not your fault and the liability carrier of the other party will have to pay for the repair of the damage.

One option you may have is to file a complaint with your state's insurance department regarding the manner in which they canceled your coverage. They may rule against Geico if they didn't follow any of the rules regarding notices or late payments, in which case you may have your policy reinstated.