How Low Can An Insurance Company Go?

This past week an item showed up on the internet about an insurance company denying coverage on a non recovered stolen car because the vehicle's history included previously being a rental car.

According to the author, Sandra Lee of Evangelical Ministries, the policy has exclusion for theft coverage if “the ignition wire was not altered.” Although the vehicle had not been recovered to establish whether or not the wiring was compromised, the insurer denied coverage stating that as a rental car it would have “multiple drivers handling the keys.” Therefore someone "could" have pocketed a key and traced its wereab0uts? I don't know about you but it certainly looks like a big stretch to me.

As more than a curiosity I requested the name of the insurance company from the author. In so doing I stated that although I expected that the company would be a substandard, it would not greatly surprise me to find it a well known insurer either. The reply?

“The insurance company was United Equitable of Skokie, IL and the brokers who accept payment on their behalf is Great Northern Insurance of Chicago, others have contacted me about United Equitable saying they waited 90 days for claims to be settled, the claims manager made offers of 50% car value then tried to lower the price and hung the phone up on them. The story just goes on. They don't even respond to the Department of Insurance when a complaint is filed.”

This activity only scratches the surface of insurance company deceit. In the future other activities will be the subject of this blog.

This response also offers confirmation why a vehicle that was previously a rental unit is worth less money than one that never was a rental in the used car market.

Ms. Lee covers the entire story and the consequences to the vehicle owner quite nicely at:
Illinois Auto Insurance Company Leaves Minister With $20,000.00 Debt.

Radio Show

Thank you all for listening and a special thanks to those that participated by calling in and emailing.

Jeff a shop owner from Chicago calling in about liability insurance problems.

Peggy from Chicago calling in with her previous steering experience.

Mike calling in about how to protect themselves from insurance buy backs.

Kevin from Chicago, a previous client of mine who was kind enough to share what he had learned working with me in the past. What a marvelous consolation of the entire process. Kevin, if you are reading this I would appreciate your forwarding your email, entering it here in the comment section or both.

Dennis and Mike Orton from Missouri that emailed in. Dennis with a question about the National Motor Vehicle Title Information System that was the subject of an earlier blog. Mike's question was more legal in nature, but a wonderful question.

Participating on the show was much fun for me and while the time didn't allow the moderator to develop those questions as deep as they could have, I will answer them here in the near future.

Mike Harbor, the moderator of the show, has asked me to be back on soon and I will be looking forward to participating again in the future. I will let you know when I am scheduled to appear again.

Crashtalk Radio

I will be a guest of Mike Stroud on CrashTalk Radio, a show for consumers to learn about collision repair.

Saturday, December 13, 2008
11:00 AM – 12:00 Noon
http://www.am1090seattle.com/ “Listen Live” button top left
Phone in #: 1-877-753-1090
e-mail: crashtalkshow@gmail.com


Potential topics for discussion:

Diminished Value
Poor Quality Repairs
Insurance Steering/DRP
Insurance Buy Backs
Rebuilt Titles
Certified Cars
National Motor Vehicle Title Information System
Total Loss Vehicles
Appraisal Clause
Consumer Fraud – purchase of previous repair w/out disclosure


If you have questions about any of the above topics, or anything else collision oriented that may be on your mind, email them anytime or call in.

Hope you will tune in and enjoy the show.

Certified Used Cars

You think “I’m going to buy a Factory Certified Used Car so I don’t need to have it inspected by an independent inspector.” Not so fast. That Certified Used Car may have had a 100+ point inspection or something comparable, but it may not have a complete warranty.

It is fact that prior accident damage history, no matter how severe, will not eliminate it from “Certified” status. However, accident damage history will void the warranty were ever applicable. Meaning if the passenger’s fender was damaged and repaired, the factory paint and rust through warranty is void on the passenger’s fender. The more severe the damage the more of the “Certified” warranty is voided. If the repairs included replacement of the air conditioning condenser with an aftermarket condenser (editor’s note; an aftermarket part is a part made by someone other than the Original Equipment Manufacturer [OEM]) the entire air conditioning system is at risk. Likewise if the radiator is replaced with an aftermarket unit the cooling system in its entirety is at risk. The greater the amount of damage and repair a vehicle has sustained, the greater the risk of lost warranty.

Frame damage is not one of the points listed on the Factory checklists at last check.

Certified Used Cars are marketed as “almost as good as new.” As a result purchasers take that for granted, do not look closely enough at them and pay a premium for them, often higher than top dollar. However, when they have a prior collision damage/repair history that has not been disclosed, consumers are over paying. You should always have a professional inspect your potential purchase to protect your pocketbook and safety.

Additional information is available at MSN Money's article "Are Certified Autos Worth the cost?";