Why isn’t that covered?  How come the entire replacement part wasn’t paid for?  What’s taking so long?  Why is the bank’s name on the check?

These are common questions from insureds during the claim process.  Let’s take a look at what constitutes a claim and how it’s handled.

First of all, a claim should be reported as soon as you have enough details to do so, regardless of whether or not your vehicle has been returned.  It’s a good practice to have your renter send pictures from the scene or of the damage as a means of documenting what was damaged as a result of the incident.  This will initiate the claim processing and allow for the claims department to start collecting the necessary documentation.  The claims department will need to confirm that the vehicle was on your fleet at the time of the accident, find out the coverages and deductibles, and get any additional insured/lienholder information from the insurance carrier.  They will also need to collect a copy of the rental agreement and any supporting documentation such as walk through or check out/in forms that note existing damage. They will need to contact an appraiser in your area to arrange an opportunity to comprehensively assess the damage.  They may also need to request a police report, which can take a prolonged time to receive.  If another vehicle was involved, this process will also involve working with the other insurance company’s claims department.  If other persons are injured or other person’s property is damaged, the claims department will need to contact those parties.  If necessary, they will need to obtain medical records of any injuries and get assessments of any property damage and work with any outside third parties for this task.  Lastly, they will need to interview the renter.

Common incidents that are generally not covered by your policy include mechanical failure, maintenance issues, and incidental damage due to failure to secure existing covered damage from additional factors.  An example of these are if a window is broken and not secured so that rain further damages the interior of the vehicle, a door falls off because the hinge was loose or the bolts were stripped, etc.  Situations that can be preventable.

Once an adjuster begins working with your body shop, there will be items that will be adjusted at a depreciated value.  An example would be an incident where tires and brakes needed to be replaced due to damage, but in reviewing the original parts, they were deemed to be worn.  You would still get new tires and brakes but may only be allotted a depreciated amount for these parts.

There are many reasons delays can occur in a claim.  If you’ve released your vehicle for an existing rental and it is not available for inspection, the claim cannot move forward.  Some delays are simply caused by the availability of parts. There are a number of vehicles on the road currently whose manufacturer no longer exists or has merged with another company.  The same is true for parts manufacturers.  Sometimes the delay is due to personnel scheduling issues.   It’s not unusual for a party involved to be uncooperative during the claims process. Negotiations within the claim can hold it up.

Lastly, if there is a bank, leasing company, or other insurable interest listed on your vehicle, the carrier has a contractual obligation to include them in certain payout situations.  You may also have a very specific contractual obligation to include them in the claim payout, especially if the unit is totaled and there is an outstanding loan on the vehicle.