Legal Question in Insurance Law in Georgia

Car Accident -- No Insurance

Here is the deal:

Brother-in-law met with new insurance company in January 05 re obtaining car insurance. Subsequently, he left town (AAA ballplayer). He received a call several months later from insurance company telling him that there was a ''hangup''. He told agent he would meet with her again when he returned. In November 05, he began corresponding via e-mail with agent. Agent told him that everything was in order, and that she only needed payment from him. On the Wed. before Thanksgiving, he told agent he would drop check off next Monday. Instead, he dropped payment in insurace company's dropbox on Wednesday night. The following Sunday morning, he was driving, fell asleep at the wheel, and struck a family travelling in a rental car. Called agent on Monday morning to report the accident, and she said ''sorry-- we didn't receive payment until this morning-- you were not covered.'' Insurance company cashed the checked several days after that conversation. Was he covered (via oral binder) or not? Bad faith by his insurance company? Rental car company and husband in family (apparently injured) are threatening to sue brother-in-law personally. Many thanks.


Asked on 8/02/06, 5:44 pm

2 Answers from Attorneys
Ronald Arthur Lowry Ronald Arthur Lowry

Re: Car Accident -- No Insurance

This is a very complicated situation--the type of matter that appeals court judges write opinions about dissagreeing with each other. I do not think it is hopeless, however. There are several legal arguments that can be made on your brother-in-law's behalf that I believe can be successful.First, when the insurer cashed the check I think that ratifed coverage going back to the time of dropping off the check. Second, there is an issue if the agent has authority to "bind coverage."That is pretty complicated and gets into details about the relationship between the insurer and the agent as well as "apparant authority" of the agent, specifics about how the agent conducted herself, etc. beyond what is in your question. Also, the agent is not the right person to make decisions about whether there is coverage or not--that is the right of the insurance company claims department. Often this type of problem is decided by a court in what is called a "declaratory judgment" case which, frankly, requires an attorney who is an expert in insurance matters. Go to my web page, read about me, then call me if you feel you need to talk more. Ron Lowry www.RonaldArthurLowry.com.

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Answered on 8/03/06, 2:41 pm
David Glass Law Offices of David H. Glass, LLC

Re: Car Accident -- No Insurance

Your brother-in-law really needs to seek the counsel of an attorney. Contract law requires consideration to be paid and accepted before there is a binding agreement. Case law may help with the fact of the drop box. It would need to be researched. If he would like to discuss it, have him give me a call. 4045299081

Sincerely,

David H. Glass

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Answered on 8/02/06, 8:56 pm


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