Auto Insurance Claims/Time Frame?

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Question
I was involved in a motor vehicle crash where a driver ran a red light at 60 miles an hour and crashed into us head on as we were making a slow left turn. He also managed to hit 2 other vehicles. Because our car was older, we had only liabilty, not collision insurance. In any case, the speeding driver was at fault, cited by the police .His insurance company is now going to pay for all the damages. Our car and 2 others were deemed totaled. Because he had only minimal insurance, but he did have collision, his insurance company is telling us that they have to wait till one of the cars is sold at a salvage sale before they can pay us and it could take weeks, maybe longer, and they may have to make payments rather than just cut one check to us. What is your opinion on this? Is this normal procedure or are we getting the run around? Our insurance company, GEICO, says to keep calling them, but that is getting us nowhere as they tell us only the "specialist" can determine the time frame.

Answer
This is a tough situation and I empathize with your plight.  Unfortunately the other insurer is telling you the truth.  Since the liability policy for their customer ism probably not large enough to cover all the damages, they need to wait until they know the precise amount of all damages so they can apportion it out on a pro rata basis to all claimants.  If they pay the limits too soon, someone will get too much and someone too little.  And they will probably require that you sign a release of all claims before they pay your total portion.

Here's why they have to do this:  they have a contract with their customer, not with you.  Their obligation is to protect their customer's financial interests first.  If they do not do everything they can to protect their customer, it would be considered bad faith and they could easily be sued by their customer for punitive damages.

Here's what you can do:  ask your insurer if you can use Underinsured Motorist Property Damage coverage with GEICO to pay for your damages now.  In some states you can do this, but in others you cannot.  Read your policy with GEICO to see if you have this coverage.  If so, they will pay your damages and then subrogate against the other insurer for their payout, up to the pro rata amount the other carrier ultimately determines they owe you.  (Subrogation is GEICO collects their payment back from the liable carrier)

Auto Insurance Claims

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Claims Guy

Expertise

I am currently an Auto Claims Manager for a large insurance company. I have 20 years experience in the industry, having worked as a Claims Adjuster, Injury Settlement Negotiator, Claims Manager, SIU/Fraud Investigator, and Compliance Officer......I can answer questions related to any aspect of Automobile insurance claims and coverages. I can provide an inside look at how insurers operate. I always treat my customers fairly and want to help make sure you are treated fairly. However, please keep in mind that being treated fairly according to the law does not guarantee that you will get what you want. I can also answer some questions regarding Homeowner's and other types of insurance claims. I have handled all types of auto insurance claims and coverages. I am NOT an automotive repair expert but can give advice re how insurers handle complex repair issues. Please keep in mind that every state has its own set of laws pertaining to rules of the road, liability, and insurance. No one is an expert on every state. I am most familiar with laws in Maryland, DC, West Virginia, and Virginia, but will attempt to answer questions for other states. I am not an attorney an cannot provide legal advice. My advice will be my opinion based on my experience.

Experience

I am currently an Auto Claims Manager for a large insurance company. I have 20 years experience in the industry, having worked as a Claims Adjuster, Injury Settlement Negotiator, Claims Manager, SIU/Fraud Investigator, and Compliance Officer. I am not an attorney an cannot provide legal advice. My advice will be my opinion based on my experience.

Organizations
CPCU Society. Adjusters license in multiple states. International Association of Specal Investigators

Education/Credentials
I have a B.S. in Finance and have completed the AIC and CPCU designations.

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