(Duties after an accident or loss)
Insurance policies are called "conditional" contracts
because, in order for the insurer to pay for a loss, the insured
has to meet a number of conditions. One of the most important
obligations concerns your actions after a loss. Once a loss occurs,
the covered person's (insured's) duties include the following:
The insured must give the insurance company
the accident details as soon as possible. The notification may
be to an agent, and, ideally, should include the identity and
addresses of any people hurt in the accident, as well as information
on any witnesses to the accident.
Notification is critical! It initiates the entire claims process,
and it gives the insurer its first and best opportunity to control
the expense of the claim.
If an insured wants coverage, he must assist
the insurer in the claim's investigation and settlement, as well
as help with defending against any claim or suit. The covered
person must immediately send the company copies of ANY material
received that's related to the accident (such as letters from
any other person involved in the accident or legal papers).
Assistance includes agreeing to attend as many physical exams,
involving doctors selected by the insurer and/or interviews under
oath, as are reasonably requested by the insurer. These requirements
are at the insurer's expense. You must also permit the insurer
complete access to medical and other records that relate to the
accident as well as give the insurer any requested proof of loss.
Your assistance allows an insurer to evaluate whether a loss payment
is due and how much has to be paid. This area has a lot of potential
for straining relations between you and your company since you
may, at times, differ over what is "reasonable," especially
when the insurance company makes repeated requests for help or
information. Although companies have the right to thoroughly investigate
losses, the responsible company balances their right against their
customers expectation of fair treatment and right to privacy.
This is extremely important and the following
example helps explain why.
Tina returns home early in the morning in her convertible and
hits a very large landscape rock that's in front of her house.
The damage is minor, but it includes damage that makes it impossible
to close the convertible top. Instead of moving the car into the
garage or covering the car, it's left in the driveway during the
day, sitting exposed to a downpour that severely damages the interior
and the car's electrical systems. This situation creates a need
to tow the car to have the damage inspected (when, originally,
it could have been driven), and it complicates the adjustment
and settlement.
Having any damage repaired or getting rid of the damaged property
without it being examined by the insurance company is a serious
breach of contract on the part of the insured. Such actions could
easily result in an insurer's refusal to make payment. If the
insured vehicle is repaired or disposed of, the insurer loses
its right to evaluate whether coverage was due, or to determine
how much was due.
Remember, this is just a generalization. You must read your own
policy for details about your duties after a loss. If you have
any questions, your insurance agent is an excellent choice to
help you properly understand your insurance policy obligations.
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