Insurance woes

September 6, 2011

It has been almost three weeks since the accident. My insurance adjustor has not been able to make contact with the other person’s insurance. I am hearing horror stories about that other insurance company. And I am starting to get worried.

I have a limited amount of coverage for the rental vehicle that I am using. Once that coverage limit has been reached, it will be my responsibility to cover the costs. I have already spent $1000 out of my own pocket. The one rental company is billing the insurance company directly.

On one hand, having the rental company bill the insurance company directly is of benefit to me. On the other hand, it could be detrimental. If I don’t know how much the bill is accumulating, then I may end up paying for a rental. If I’m going to pay for a rental, I think I would rather simply purchase another car.

Well-meaning friends are telling me that insurance claims for vehicle accidents take months to settle. I cannot afford to rent a vehicle for months. And I cannot afford to do without a vehicle. I will not be able to make any money if I do not have a vehicle to transport myself and my product to the farmer’s markets.

As each day passes, my knowledge of the process involved increases. And my worry increases. I have never been involved in an accident claim. It’s fortunate that the injuries were minimal. At least we don’t have to deal with medical bills on top of the vehicle bills.

I thought insurance was to protect against circumstances like this? To help when accidents occur? Help after the fact isn’t really “help.” If I have to wait months for my claim to be settled, then that means I have to pay out of my own pocket for my expenses during that time. What happens if the funds are not there to pay for the rental, another car, other transportation?

What happens when the accident causes injury and the person injured can’t work? Not only do they lose their source of income, but they also have an increase in spending due to medical needs. What does a family do then?

I know that the financial advice is to ensure that one has six months of living expenses set aside. Some advisors say three months is enough. The reason I was told to do this was because if something were to happen and I could not work, I would have the expenses to carry me for three to six months.

Now, dealing with this vehicle claim, I realize that one needs six months of living expenses set aside to carry through until the insurance claim is settled. It isn’t just in case of losing employment. It’s in case someone is using their cell phone or texting while driving and rear-ends you.

I guess that’s why lawsuits are on the rise. What is a person to do? The insurance companies are too slow to be of “help,” when the help is actually needed. So a person has no choice but to involve the legal system and sue the other driver. For many people, that is the only way they can recuperate what they had to spend while waiting for the insurance claim to settle.

This is a shame that bureaucracies prefer to operate in this manner. It does not have to operate this way. There are other solutions. One step I am taking to avoid filing a lawsuit is to register a formal complaint with the Insurance Bureau of Canada. Hopefully, this body will help encourage the two insurance companies to work through the process in a timely manner.

If that doesn’t work, then I might have to join the thousands that file lawsuits and keep the lawyers and various court officials employed.

For information on the vehicle accident, see my blogs titled, “Third time not so lucky,” “Scattering stuff as I go,” “Laying the foundation,” and “Negotiation 101.”

For information on the Insurance Bureau of Canada, click on the link: http://www.ibc.ca/en/