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  1. #1
    Join Date
    Aug 2017
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    3

    Default Can an Insurance Company Sue You for a Debt if You Hold a Policy With Them

    My question involves collection proceedings in the State of: Michigan

    So, the not so long version. State farm is suing me over for being in a car crash because I didn't have insurance in 2011.

    Now I have been to court once and a judgement has been filed, which I thinking that was not the greatest thing to do back in the day. My judgement is 8k and change.

    I was paying courtesy payments for about a year in which I was told by the law firm (Stillman Law Office) that I was going to get my case redetermined after a year. Which never happened. Now partly my fault as I stopped the courtesy payments because I could not afford them. They were not that much, but I do not make that much.

    Long story short , I was deemed not responsible for the accident, I went to court when summoned and I do not have 8,000 dollars to pay for my judgement.

    On the other hand, since the accident I have had State Farm as my insurance agent, and they are suing me for the crash. ( does this not violate some fundamental law if physics here ) How can a company that is providing me service, still sue me and accept moneys out of me at the same time..

    Also, as I do not have the money to pay said judgement, and as of yesterday they are looking to suspend my license, is my only option bankruptcy?

    Since the old catch 22, I go to jail (hopefully that doesn't happen) I cant pay, but I don't have enough money to pay.

  2. #2
    Join Date
    Oct 2014
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    8,238

    Default Re: Can a Business Sue You if You Are Doing Business with Them

    Quote Quoting emforeit
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    On the other hand, since the accident I have had State Farm as my insurance agent, and they are suing me for the crash. ( does this not violate some fundamental law if physics here )
    Physics has nothing to do with this. Nor is it illegal under federal or Michigan state law, either.

    Quote Quoting emforeit
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    How can a company that is providing me service, still sue me and accept moneys out of me at the same time.
    It is no more absurd than you deciding to buy insurance from the company that has a judgment against you. This sort of thing happens all the time. State Farm is doing business with you because it sees an opportunity to make money selling you insurance. You are doing business with them because you need to have insurance (which your previous accident made clear to you) and presumably you determined that State Farm offered you the best deal.

    Quote Quoting emforeit
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    Also, as I do not have the money to pay said judgement, and as of yesterday they are looking to suspend my license, is my only option bankruptcy?
    We don’t know all the details of your situation to know what alternatives you have. You could try to strike a new deal for paying off the debt to get State Farm to relent on the license suspension. If you aren’t paying them anything now then of course they are going to do something to get your attention and try to shake some money out of you. As the old saying goes, money talks. If you can’t find some way to get the money — can’t borrow it from someone, can't sell something to come up with it, whatever, then you may need to consider bankruptcy. But understand that if the accident was the result of a DUI then the judgment may not be dischargeable in bankruptcy. You'll want to discuss what bankruptcy might do for you with a bankruptcy lawyer.

  3. #3
    Join Date
    May 2017
    Location
    Florida
    Posts
    355

    Default Re: Can a Business Sue You if You Are Doing Business with Them

    You will not go to jail for failing to pay a civil judgment. But they can easily sue you for the claim they had to pay due to you not having insurance to pay the claim. If you don't pay, they can garnishee your wages. Bankruptcy will potentially discharge the judgment debt, but that's a heck-of-a thing to do over $8. Filing for bankruptcy isn't free and it sticks with you for a long time. Just to avoid paying $8k? If you don't have other debts, I seriously doubt you even qualify.

  4. #4
    Join Date
    Aug 2017
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    3

    Default Re: Can a Business Sue You if You Are Doing Business with Them

    so the accident was not a dui. in fact I was deemed not responsible for the accident, I just didnt have insurance at the time. I fought the ticket and won deeming the other party at fault. I do not have that kind of money, nor does my family of friends. I dont not have much of value,, with out having my own pity party. I just moved into a house that a friend of mine is letting me rent out, the newest car I own is a 04, and a very little 401k value and my credit sucks.. that is something I am working working on.

  5. #5
    Join Date
    Jan 2006
    Posts
    38,867

    Default Re: Can a Business Sue You if You Are Doing Business with Them

    The crazy thing about this all is if he had the minimum required insurance the most he would have owed the other party (if he was at fault) would be $1000. Michigan does not require you to carry insurance to cover who you hit since we have a modified no fault but if you don't have insurance you can be held liable for all the damage you cause.

  6. #6
    Join Date
    Aug 2017
    Posts
    3

    Default Re: Can a Business Sue You if You Are Doing Business with Them

    I do have other debts, but none that hang over my head like this one.. I just got done paying off 18 years of child support, but I am afraid I am just going to right back into pay something else.. now I have no problem with them garnishing my wages, but the last time we talked they would not take my offer, since it was not enough for them. If you are going to take my money, take it, but I still have a family to support.

    I was actually "between" insurances.. lol, no I didnt have it at the time, but I was not planning on going without. we were just going through a really rough patch.. I think its luck really. now my luck patch is following me. on the other hand, is there anything else I can do?

    Could hiring a lawyer now, even though there is a judgement of me paying and license suspension on the table, turn the tide a bit?

  7. #7

    Default Re: Can an Insurance Company Sue You for a Debt if You Hold a Policy With Them

    If you (after the fact) were deemed NOT responsible for the crash, you should file SOMETHING with the court to re-open the judgement as you can now PROVE you were not responsible.
    If you cannot re-open it, I'd get a lawyer and file a lawsuit AGAINST STATE FARM, for the money you've already paid to them, because they ALREADY KNOW you've been deemed not responsible, but are still trying to collect this debt.

    I would get a lawyer and find out your options. .if your not responsible anymore, you shouldn't have to pay at all... no ins or not.

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