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Auto Insurance Claims/Claim proceeeds and Bankruptcy

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Expert: - 4/1/2009


Question
Who Gets the Money?
If a policyholder was paid on a hail damage claim on a leased vehicle, with a lender named as co-insured, but he does not fix the car, then files bankruptcy and surrenders car back to the dealer. Where does the claim check go? The asset was clearly declared in the bankruptcy and the lenders attorney did not ask the trustee for it.  

Answer
Hi Daniel,

Based on the scenario you laid out, the check should be turned over to the leasing company. The reason the check was made out to both parties is to protect the value of the leinholders asset. If the repairs were not completed, then the lienholder get the money to complete the repairs.

I hope this helps
Richard Hixenbaugh

Auto Insurance Claims

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Richard Hixenbaugh

Expertise

Auto insurance claims procedure, auto coverage, liability issues, auto damage questions, how to deal with the insurance company, loss of use and diminished value.

Experience

I have been involved in the insurance industry for over 25 years. I have experience in underwriting, sales, claims adjusting, auto damage estimating, auto value appraising and diminished value appraising. I have testified as an expert witness over 35 times.

Organizations
Society of Certified Auto Appraisers

Education/Credentials
Completed all required courses for the Florida Property-Casualty agents license and the Florida claims adjusters license. I have attended various courses on auto damage estmating, vehicle appraising and am ASE certified in collision damage analysis.

Past/Present Clients
My company has done work for consumers nationwide.

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