Insurance Bad Faith? Steven Ortega asked 7 months ago
Insurance Bad Faith?

Long story short I was involved in an accident 04/15/2023. My 2021 Camaro SS high performance car is still at the shop with the end nowhere near in sight. There is an engine harness that is on backorder and GM cannot give a date as to when it will be put back into production. My insurance is hanging onto that and telling me my only option is to wait until that part becomes available. They covered the first 30 days of rental coverage and after that was exhausted, it’s been on my wallet ever since. I’ve spent and currently spent thousands just to have something to drive. The issue is the body shop. I’ve been sitting back and observing everything transpire and I have solid reason to believe that there is some kind of fraud going on because first, the body shop is claiming the vehicle no longer goes in reverse. For one, I have video footage of his tow truck guy reversing my Camaro onto the flatbed so that vehicle was able to go reverse the day of the accident. Second, that vehicle is not even supposed to be turned on, nor driven and when the body shop came out with that development the insurance quickly responded with those detail of not starting it or driving because it could cause damage not covered by the policy. Given that mistake and a few other detail with the fraud how should I handle this matter? Should I be seeking counsel? Should I be submitting a complaint with the automotive bureau and, if so, who investigates the fraud?

I do have correspondence between the damage insurance adjuster and the body shop confirming the part needed is on backorder and the adjuster goes on to state that if the harness has anything to do with airbag functionality it would require being replaced which would then put this claim close to a total loss. This communication was dated back in May. The progress that has been made since the date of that email has been denying coverage for transmission service and leaving an outstanding bill unpaid with the dealership. Meanwhile I’m having to spend thousands on rental expenses just to have something to drive. As all this is transpiring the bodyshop is racking up storage fees with everyday that passes. It feels like I’m stuck and I need some advice on which avenue I should be pursuing. I’ve submitted both complaints with department of insurance and the automotive bureau but they do no have my best interest I’m starting to realize. Should I be seeking counsel for an insurance bad faith matter, and if so can this claim mishandling be combined with another claim denial on my renter’s insurance policy with the same company?

1 Answers
Answer for Insurance Bad Faith? United Policyholders Staff answered 5 months ago

Dear Steven,

We are sorry to hear about your suspicions regarding the auto shop. Delays in repair and other concerns about the autoshop’s treatment of your vehicle are outside United Policyholders’ area of expertise and it sounds like you have already made efforts to file complaints with the Bureau of Automotive Repair (https://www.bar.ca.gov/consumer/auto-repair-basics). You should also contact the non-profit Consumers for Auto Reliability and Safety, https://www.carconsumers.org/, they may have additional suggestions.

Regarding insurance coverage for a rental vehicle, if your policy only includes up to 30 days of rental coverage, as many policies do, then you are unfortunately responsible for paying for your rental after that month is over. That said, we do not agree with your adjuster that there is nothing they can or should do until the necessary harness is off of its indefinite backorder. Indeed, simply sitting back and doing nothing may constitute “bad faith” on the part of your adjuster. California law requires an insurance company to investigate, process, and pay your claim fully, promptly and deal fairly with you at all times. CA Ins. Code 790.03, 10 Cal Code of Regs 2695.9. Failure to do so can result in them owing you additional penalties.

While supply chain issues and reasonable delays in finding replacement parts are often unavoidable and not the fault of an insurance company, we encourage you to continue communicating with your adjuster and make firm demands for the repair to be completed promptly or for the car to be declared a total loss. Your adjuster may be able to help find an adequate non-OEM replacement part (if so, you are entitled to make sure that part is comparable to an OEM part in terms of kind, quality, safety, fit and performance). If your adjuster is not able to find a replacement part in a reasonably timely manner, or otherwise adequately fix the harness, then your vehicle should be considered a total loss and they should pay out your claim accordingly. What counts as a reasonable time to complete repairs is not set in stone and unfortunately can probably include months of waiting, particularly if you have a specialized high performance vehicle. But remember, your insurance company is responsible for storage fees pending repair and so should have a similar incentive to resolve things quickly. Hopefully pointing this out to your adjuster can help move things along.

Ultimately, you may want to consider professional assistance, in which case UP’s network of insurance specialist attorneys in your state can be a place to begin your search (https://uphelp.org/recovery/professional-help-directory/).