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  1. #1
    Join Date
    Mar 2012

    Default How Long Does the at Fault Party's Insurance Have to Pay for My Rental Car

    My question involves an injury that occurred in the state of: CA My car is in body shop and has been finished for a week. Body shop won't release my car because they haven't received payment from the at fault party's insurance co. They've had previous non payment issues with this company. The insurance company says, as of Wednesday (3 days ago), they are no longer paying for my rental car. Check was still in accounting Friday (yesterday). They are very uncooperative, don't answer or return calls. Can they stop paying for my rental car before I have my car back? The driver didn't even have a driver's license and didn't stop after hitting me. I had to follow them and tell them to pull over.

  2. #2
    Join Date
    Sep 2005
    Behind a Desk

    Default Re: How Long Does the at Fault Party's Insurance Have to Pay for My Rental Car

    They can stop paying whenever (a) they determine that the claim exceeds the coverage purchased by their insured, or (b) they decide that the amount claimed is not reasonable. It's not at all unusual for an insurance company to refuse to pay for a rental vehicle after a repair is complete. It is unusual for a body shop to insist upon holding a car after an insurance company has contractually committed to pay its bill and the repair is complete - what's the back story there? Did they pick the repair shop or did you?

  3. #3
    Join Date
    Sep 2011

    Default Re: How Long Does the at Fault Party's Insurance Have to Pay for My Rental Car

    In my experience, it's actually not uncommon for the body shop to hold the car until payment is received for certain insurance companies they've had issues with. Most shops will release because they are being paid electronically and they know the payment will hit. They want the customers happy so the shop can keep a good relation with that insurance company. Some insurance companies will play games and have unreasonable delays so the shops hold their customers cars so the customer gets pissed off at the insurance company. But by the time this happens, the bridge between the shop and insurance company has already been burned.

    This isn't common, but when it does happen, it's more often that the insurance company is being unreasonable and it's often a smaller, shady company. If the shop is holding a car from a big name company, then it's likely the shop that has the issues.

    Another reason the shop will hold is if the car is a claimant. Insurance companies will typically pay claimants direct if the car is repaired outside of the Direct Repair Program facilities. The insurance company doesn't owe the shop anything. The insurance company owes the claimant. So they'll send the check to the claimant and if the shop releases the car, the claimant can simply cash the check and then the shop has to go after the person. The claimant could just go buy drugs or hit the casino and then the shop will never collect from the welfare baby.

    In reality, if the shop isn't being direct paid upon completion, the insured/claimant should have received the check prior to repairs being completed. The estimate would have been written prior to starting repairs so the check would have been sent out long before it's fixed. Or with my company, we pay you on the spot. If I write $40k in damage on a $100k car, I'll cut you a check for $40k right there. So when it's time to pick it up and the customer says they haven't been paid yet, there is something wrong there.

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