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Car Insurance - How Does It Work?  
User currently offlineSpringbok747 From Australia, joined Nov 2004, 4387 posts, RR: 10
Posted (9 years 9 months 1 week 5 days 5 hours ago) and read 3858 times:

Ok..I had a car accident last week, and it wasn't my fault. The guy just hit me from behind, as I had stopped at the traffic lights. (I had another thread about that Big grin )

Anyway, I am insured, but I just found out that the other guy has no insurance. My insurance company agreed to fix my car, and it seems they will claim the money from the other driver..the one who hit me. The thing is, the other guy who hit me...he is actually one of my good friends, and we know each other for a long time. He says he doesn't have the money to pay, and now my insurance company is going to take legal action against him.
He thinks it's my fault and now he just hates me. How the hell am I at fault here? Also..is this the way car insurance works around the world? Just wanted to know.

Thanks in advance  Smile


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25 replies: All unread, showing first 25:
 
User currently offlineANCFlyer From , joined Dec 1969, posts, RR:
Reply 1, posted (9 years 9 months 1 week 5 days 5 hours ago) and read 3841 times:

Friends like that you don't need. He is at fault. If he's as good a friend as you say, then he'll find a way to figure it out . . .

Works the same here, as far as I know.

Uninsured motorist hit you here, your insurance company pays and qwill sue the uninsured motorist most often. That's the name of the game.

In most states here in the US you MUST have insurance . . .

By the way, in your post last week, didn't you say something about some a(&#%()@*(#*(*(&@)0 hit you from behind. . . . this a(&#%()@*(#*(*(&@)0 is one of your good friends! I'd hate to think how you refer to your enemies  Wink/being sarcastic


User currently offlineKieron747 From , joined Dec 1969, posts, RR:
Reply 2, posted (9 years 9 months 1 week 5 days 5 hours ago) and read 3832 times:

Hi!

I had a similar experience, my friend (uninsured) was following me to University after he had smoked a few reefers if you know what i mean, he wrote off my car, his was undamaged.

He begged me to not claim as he would be in deep shit with the insurance and eventually the police.

But what could I do? He was at fault and he blamed me and started badmouthing me to my friends for not being a good mate!

Strangely enough, while I was deliberating over the issue, a passer by driver who had seen the accident told the police. I was therefore no longer in control of the situation as they knew his number plate.

Needless to say, we are no longer friends through no fault of my own. You have to ask yourself, would a real mate put you in this situation? There is always a way out, but at the end of the day, he should have had insurance. You had insurance eh!

What got me was how he tried to turn my friends against me by saying I had cheated on a friend and was a traitor! When he was the one who got wasted, destroyed my car, and i hadn't even told anyone about it!


User currently offlineSpringbok747 From Australia, joined Nov 2004, 4387 posts, RR: 10
Reply 3, posted (9 years 9 months 1 week 5 days 5 hours ago) and read 3827 times:

LOL..ANCflyer, I was a bit pi$$ed off...but yeah, you're right, I don't need friends like that.


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User currently offlineANCFlyer From , joined Dec 1969, posts, RR:
Reply 4, posted (9 years 9 months 1 week 5 days 5 hours ago) and read 3817 times:

Quoting Kieron747 (reply 2):
But what could I do? He was at fault and he blamed me and started badmouthing me to my friends for not being a good mate


Please refer the following:

Quoting ANCFlyer (reply 1):
Friends like that you don't need.


Regards


User currently offline2H4 From United States of America, joined Oct 2004, 8956 posts, RR: 60
Reply 5, posted (9 years 9 months 1 week 5 days 5 hours ago) and read 3806 times:
AIRLINERS.NET CREW
DATABASE EDITOR

Whenever dealing with insurance companies, I strongly recommend taking this along:








2H4



Intentionally Left Blank
User currently offlineCPDC10-30 From United Kingdom, joined Feb 2000, 4798 posts, RR: 23
Reply 6, posted (9 years 9 months 1 week 5 days 4 hours ago) and read 3796 times:

Being in this business myself - let me give you all a couple of tips:

-Make sure you read your policy documents and follow them to the letter. It isn't uncommon to "mistakenly" charge a deductible that should be waived. It happened to me actually where the company first tried to charge me a collision deductible when I was not at fault, and then tried to charge me a deductible because I was hit by an uninsured motorist (I had an endorsement for this coverage also). I refused to pick up my car from the repair shop and continue driving the rental car (at their cost) until they figured their shit out. Finally they admitted they were wrong a week later.

-The underwriting and claims departments often don't talk very much. Don't assume the claims rep knows anything about your policy. All they are doing is their job which is to reduce the company's exposure. Many don't take a "holistic" approach.

-If you are claiming BI (bodily injury) benefits over about $10,000 make sure you aren't carrying any heavy boxes outside your house. You better believe insurance companies make extensive use of surveillance and private investigators. Once they have a few pics your claim is toast.

[Edited 2005-02-19 04:12:23]

User currently offline777ER From New Zealand, joined Dec 2003, 12282 posts, RR: 18
Reply 7, posted (9 years 9 months 1 week 5 days 2 hours ago) and read 3773 times:
AIRLINERS.NET CREW
FORUM MODERATOR

Quoting Springbok747 (reply 0):
Also..is this the way car insurance works

Yes, that is how car insurance companys work. The driver was driving a nice European car (if I remember correctly from your post Springbok747) and he can't afford insurance or even pay for the damange!


User currently offlineSpringbok747 From Australia, joined Nov 2004, 4387 posts, RR: 10
Reply 8, posted (9 years 9 months 1 week 5 days 1 hour ago) and read 3766 times:

777ER,

The car he was driving wasn't his, it's his friend's actually. This makes the whole damn scenario so complicated. The BMW is insured, but since this guy was driving without the other guy's consent (the owner is in US now..he'll be back only in April), the insurance refused to pay. Now the driver is responsible, so yeah, he can't afford to pay. Anyway, we'll see what happens.



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User currently offlineQANTAS077 From Australia, joined Jan 2004, 5861 posts, RR: 39
Reply 9, posted (9 years 9 months 1 week 4 days 21 hours ago) and read 3760 times:

hahaha, that sounds more dodgey then a root in a brothel, serious, how did you not know that the person who hit you was a good friend?? did you report the accident and do the legal stuff. i'd be very careful about telling the insurance co that your friends with the other driver!


a true friend is someone who sees the pain in your eyes, while everyone else believes the smile on your face.
User currently offlineNumberTwelve From Germany, joined Dec 2004, 1431 posts, RR: 9
Reply 10, posted (9 years 9 months 1 week 4 days 14 hours ago) and read 3737 times:

I know it from the US that car owners don't need to have a liability insurance - but is it the same in Australia??

In Germany this could happen if you don't pay your liability insurance - but normally car has to be shut down until insurance is paid again.
This insurance is only for the other party of the accident.



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User currently offlineAir2gxs From , joined Dec 1969, posts, RR:
Reply 11, posted (9 years 9 months 1 week 4 days 14 hours ago) and read 3733 times:

Quoting NumberTwelve (reply 10):
I know it from the US that car owners don't need to have a liability insurance - but is it the same in Australia??


I don't know of any jurisdication in the US that does not require liability insurance.


User currently offlineNumberTwelve From Germany, joined Dec 2004, 1431 posts, RR: 9
Reply 12, posted (9 years 9 months 1 week 4 days 13 hours ago) and read 3728 times:

Air2gxs, so does every car owner has to have an insurance that protects the other car owner in such cases?


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User currently offlineTheiler From United States of America, joined Nov 2001, 633 posts, RR: 1
Reply 13, posted (9 years 9 months 1 week 4 days 13 hours ago) and read 3728 times:

New Hampshire, S. Carolina, Virginia and Wisconsin do not presently require liability insurance.

User currently offlineNumberTwelve From Germany, joined Dec 2004, 1431 posts, RR: 9
Reply 14, posted (9 years 9 months 1 week 4 days 13 hours ago) and read 3724 times:

Bingo, Theiler, so the information I have is correct.
Quoting Air2gxs (reply 11):
don't know of any jurisdication in the US that does not require liability insurance.


Ok, Air2gxs, Theiler knows some states. Now my question: what about Australia, isn't there a compulsory insurance?

It's always said that Germany has too many rules and laws - some really are a horror but some are definitely necessary.



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User currently offlineLeanOfPeak From United States of America, joined Oct 2004, 509 posts, RR: 1
Reply 15, posted (9 years 9 months 1 week 4 days 3 hours ago) and read 3698 times:

Theiler, what's your source? This source says that the only states without compulsory liability insurance are New Hampshire, Tennessee, and Wisconsin.

NumberTwelve,
The finding of some states in which liability insurance is not compulsory does not justify the broad-based statement that
Quoting NumberTwelve (reply 10):
I know it from the US that car owners don't need to have a liability insurance - but is it the same in Australia??


I believe there is mandatory liability insurance in Australia as well. However, there are instances in the United States (And I am sure there are in Australia as well) of people flying under the radar and managing to get by without it. Of course, when they then have an accident or a ticket, they are in trouble.

However, should an uninsured driver strike your vehicle, this merely means that you have a civil claim against the driver instead of an insurance company (Which too often is fruitless, because, if they had the thousands of dollars to fix your car, they probably would have had insurance) and the driver is also criminally liable (Which generally will not bode well for their ability to ante up your civil claim either).

There is a popular supplemental coverage, at least in the United States, that is only compulsory if you have a bank loan on the vehicle which pays the insured in the event of a collision with an at-fault uninsured motorist (It is called, of course, uninsured motorist coverage).


User currently offlineGuitrThree From United States of America, joined Oct 2004, 2059 posts, RR: 8
Reply 16, posted (9 years 9 months 1 week 4 days 3 hours ago) and read 3694 times:

Quoting LeanOfPeak (reply 15):
Theiler, what's your source? This source says that the only states without compulsory liability insurance are New Hampshire, Tennessee, and Wisconsin.



ah ah, not so fast. Tennessee, as of about three years ago, does require liability insurance. Actually, they always did require it, and if you were the one that caused an "at fault" accident, you had to then provide to the state proof of insurance in a reasonable amount of time, if you didn't they suspended your license, but at that time, you didn't have to show proof during a traffic stop and/or road block.

Today, yes, if you are stopped for any reason you probably will be asked and must show proof. If you can't, you're not driving the car home, no matter what the reason you were stopped.



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User currently offlineN317AS From , joined Dec 1969, posts, RR:
Reply 17, posted (9 years 9 months 1 week 4 days 3 hours ago) and read 3688 times:

"....after he had smoked a few reefers if you know what i mean"


Whatever do you mean, man? What's a refer, man?


Anyway. Insurance. You pay and pay and pay. When you finally have an accident that isn't your fault. They try and give you $1500 for a fully restored '68 Z-28. So you end up getting one of those lawyer things and suing the crap out of them. Good times, good times.


User currently offlineDeskPilot From Australia, joined Apr 2004, 767 posts, RR: 0
Reply 18, posted (9 years 9 months 1 week 3 days 22 hours ago) and read 3674 times:

Springbok, what state were you in when you had the bingle ? Compulsory Third Party (CTP) insurance for injury differs per state.

Although I work in General Insurance, I'm not in the underwriting or claims areas. However, I'm reasonably sure that the insurer of the other car wont cover the accident since your friend isn't a defined driver on the policy. So, your friend will have to deal with the owner of the car when he returns.

Claim the damage for your car through your insurer. They'll "extract" the money our of your friend overtime. You may have to pay the excess too on your claim, and the insurer will pay this back once they've go their money back.

Given your friend is driving someone else’s car without permission and now wants to believe you're in fault, means to me he is a friend. Cut your ties with him and let your insurer deal with it. Good luck with things.

[Edited 2005-02-20 10:18:32]


By the way, is there anyone on board who knows how to fly a plane?
User currently offline777ER From New Zealand, joined Dec 2003, 12282 posts, RR: 18
Reply 19, posted (9 years 9 months 1 week 3 days 22 hours ago) and read 3671 times:
AIRLINERS.NET CREW
FORUM MODERATOR

Quoting DeskPilot (reply 18):
Given your friend is driving someone else’s car without permission

Which is thieft, so your insurance company could bring the Police into it.


User currently offlineSimo82 From Italy, joined Feb 2005, 181 posts, RR: 0
Reply 20, posted (9 years 9 months 1 week 3 days 22 hours ago) and read 3670 times:

Quoting Springbok747 (reply 0):
Also..is this the way car insurance works around the world? Just wanted to know.


Here every car has to have a so called RCA insurance which is a total insurance for civil responsibility, means that in case you have an accident the insurance will cover 100 % of the expenses others have to take ( car repair, medical expenses, working days etc...)
However the insurance that pays for your own damage is optional and very expensive.

Generally speaking when somebody hits you the insurance that care of everything just need to phone them and they will tell you what to do.

CIAO
Simo


User currently offlineSyncmaster From United States of America, joined Jul 2002, 2039 posts, RR: 10
Reply 21, posted (9 years 9 months 1 week 3 days 19 hours ago) and read 3664 times:
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Quoting Springbok747 (reply 0):
Also..is this the way car insurance works around the world?



Here in Michigan we have what's call no-fault insurance, meaning that your insurance company picks up the tab (if you claim it) no matter if your at fault or not. But in order to have a license plate you must show proof of insurance, and every year you must show it as well to get an updated tag. Must of the major providers of insurance provide information to the state so their customer doesn't have to and you can then use the various forms of renewal outside of taking a trip to the Secretary of State's office (they handle motor vehicle registrations).

Sorry to hear about your problem, sounds like you got put between a rock and a hard spot. Good luck.  Smile

-Charlie


User currently offlineSpringbok747 From Australia, joined Nov 2004, 4387 posts, RR: 10
Reply 22, posted (9 years 9 months 1 week 3 days 19 hours ago) and read 3661 times:

DeskPilot,

This happened in South Australia...in Adelaide. And yup...he's not my "friend" anymore. He knows he's in big trouble now, as he screwed up because he was driving the car without the owner's permission. The onwer of the BMW came to know the news today..and he is very upset, which is understandable.

I guess I will have to pay an excess, and then claim it back when my insurance company gets the money from him. Anyway, thanks for all the replies guys, really appreciate it  Smile



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User currently offlineLehpron From United States of America, joined Jul 2001, 7028 posts, RR: 21
Reply 23, posted (9 years 9 months 1 week 3 days 6 hours ago) and read 3621 times:

With insurance of any kind, you're basically betting against yourself, on the just in case you f*ck up. But insurance companies are still businesses, that is, they want something out of your misfortunes, they will tag fees on top of the monthly/annual charge.

Again, just in case you have an accident. If you don't ever have one, good for you; you're not only alive and happy but you've wasted (in hindsight Big grin) almost a quarter million in cash due to betting against yourself in your own lifetime.

I think the 80/20 rules falls here, that 80% of revenues comes from 20% of customers? In this case maybe insurance companies can cut a deal with 80% of it customers that are good drivers and get all the profits they need from the 20% of unlucky people who get into accidents the most often. These people should not go to casinios otherise they'll make the owners rich.  Laugh out loud



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User currently offlineTheiler From United States of America, joined Nov 2001, 633 posts, RR: 1
Reply 24, posted (9 years 9 months 1 week 3 days 6 hours ago) and read 3617 times:

Source: http://info.insure.com/auto/minimum.html . I make no claims as to the site's validity.

Auto insurance isn't as profitable as some folks think.. Especially in some states (MA, for example) There are some -very- risky customers out there that companies may -have- to insure in some states. Sure, underwriting calculations may result in a very high premium, but in some cases, the insurer can almost expect to lose money on the plan.


User currently offlineDeskPilot From Australia, joined Apr 2004, 767 posts, RR: 0
Reply 25, posted (9 years 9 months 1 week 3 days 5 hours ago) and read 3610 times:

Quoting Lehpron (reply 23):
think the 80/20 rules falls here, that 80% of revenues comes from 20% of customers? In this case maybe insurance companies can cut a deal with 80% of it customers that are good drivers and get all the profits they need from the 20% of unlucky people who get into accidents the most often.


Your premium is based on your risk. So, if you are a good risk (e.g. female drivers, males between 25 thru about 60 yo) you will have a lower premium. If you are a bad risk, you will be charged a higher premium, have a higher claims excess or maybe are denied insurance.

However, insurance is about spreading the risk too, so Lehpron you're analogy wont work.

Quoting Lehpron (reply 23):
But insurance companies are still businesses, that is, they want something out of your misfortunes, they will tag fees on top of the monthly/annual charge.


No, insurance companies would be pleased if you had no accidents ! Claims amount to approx 60% of revenue received by an insurer. In some classes, over 100% of the revenue is spent on covering losses and expenses :
- claims,
- reinsurance (insurance with other insurers), and
- admin (staff, office space, IT, etc. etc.).

So the insurer relies on return on investment of the premium received, to make a profit. They may also subsidise from other classes of business.

When you pay extra for a monthly premium, as opposed to an annual up front premium, the fee covers the lost income from investment.



By the way, is there anyone on board who knows how to fly a plane?
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