Insurance Helpline | Smothered by insurance jargon
QUESTION: I am seeking your urgent help to solve a problem. About three months ago, my 2010 Toyota Corolla was parked along Market Street in Falmouth. It was struck by another vehicle. A bus reportedly pushed another vehicle into my car. The bus is insured with a company in Montego Bay. My vehicle and the other car are covered by the same company. The cost of repairing my vehicle is $102,000; however, the excess on my policy is $105,000. My insurers have said that the driver who hit my car is not liable since he was pushed into my car by the bus. Is this correct? They also mentioned 'proximate cause'. The bus driver/owner has still not filed a report with his insurer. I am just sitting down waiting while my car is deteriorating. Can you help?
INSURANCE HELPLINE: "Action, not a bag of mouth!" The context for the words of this song is inappropriate for this article; however, the first word captures exactly what has been missing during the last three months. Many words, three confusing and unrelated messages, and zero action on the part of two insurance companies.
Your insurer's first message is that they are off the hook. The repair cost of your car is below the policy excess - also known as the deductible. This means that you will have to fund the repairs from your pocket. Also, you will have to lead the efforts to recover the money that you spend from the insurers of the two other vehicles. Whether you succeed or fail is not their business.
Their second message was given when they were wearing a different hat. This time, it is the hat of the insurers of the car that struck yours. By mentioning proximate cause and referring you to the company that insures the bus, they are actually saying: "Do not look to us for compensation for the damage to your car. The driver who hit your vehicle was not at fault. His vehicle was struck by the bus. We have absolutely no interest in the matter. If you want compensation, get it directly from the bus driver/owner or their insurers."
The message of the insurers of the bus bears absolutely no relation to the other two. "Our hands are tied. We cannot do anything until the bus driver/owner has reported the accident to us as is required under the terms of our policy."
"The legal concept known as 'proximate cause' in a car accident case," according to Zachary Matzo, "refers to a driver's act (or failure to act) that actually causes the auto accident and results (in) injuries (to persons and/or to property) ... (it) may come into the discussion when both sides of an insurance claim or lawsuit are debating the issue of fault for the car accident ... . Car accident cases generally have both a proximate cause and a legal cause component, and these are not always one and the same.
"Proximate cause in a car accident case always refers to the act that initiated the event or chain of events leading to an injury, (or damage) while legal cause in a car accident case refers to the actual instrument causing injury."
In the case of your accident, for example, the proximate cause would be the bus, while the legal cause would be the vehicle that struck yours.
Accept the proximate clause concept for the sake of convenience. Follow it up with some action. Take a day off from work. Drive to the bus insurer's offices in Montego Bay.
Take along the following with you: the police report, the repairer's estimate, the loss adjuster's report, photographs of the damage to your vehicle, a copy of Section 8 of The Motor Vehicles Insurance (Third-Party Risks) (Amendment) Act 1989 - which may be downloaded free of charge from moj.gov.jm, and a copy of this article.
Put the following two-part argument to the insurers. The first recognises that the claims condition of the policy that covers the bus imposes a duty on the insured to "give notice in writing ... immediately upon the occurrence of any accident". Also that you are aware that "the due observance and fulfilment of the terms of the policy, in so far as they relate to anything to be done or complied with by the insured ... shall be conditions precedent to any liability of the company to make any payment".
The second part of your argument should be about Section 8 of the act. It says: "Any condition in a policy ... providing that no liability shall arise ... or that any liability so arising shall cease, in the event of some specified thing being done or omitted to be done after the happening of the event giving rise to a claim under the policy ... shall be of no effect".
This amendment to the act was designed to prevent insurers from refusing to pay a claim based on the excuse that it was not reported or that it was reported late.
Three months have passed without a report from the bus driver/owner. A report at this stage is even less likely. The claim for the repair of your vehicle plus any loss-of-use expenses should be settled by the insurers of the bus on the basis of the information that you have supplied. If this does not work, tell them that you will be getting a lawyer.
Cedric E. Stephens provides independent information and advice about the management of risks and insurance. For free information or counsel, write to: firstname.lastname@example.org.