The Loss Is Only The Beginning

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:

Notification

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.

Assisting The Insurance Company

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.

Preserving The Damaged Property After A Loss

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.