I went into my Insurance office on 2/17/12 paid 114.00 the amount I was told to pay six days latter my Insurance was cancelled because I did not pay enough wich also resulted in the money for the march payment not beieng direct debted from my acount I was finally notifid of this on 3/26/12. I paid the 209.13 as soon as posiable on 4/2/12 on 4/2/12 I had an accadent they are saying the will not cover it. but I dont feel the mistake was mine.
You did not say when on 4/2/12 the payment of $209.13 was made? It makes a big difference if it was paid before or after your motor vehicle accident. If payment was made before, and accepted, you have a much stronger position.
Cancellation has been thoroughly litigated in Michigan. You are not the first one to go through this with an insurance company. So, the place to look as to whether a cancellation is valid or not is governed by MCL 500.3020. This requires cancellation be given by first class mail with not less than 10 days written notice of the cancellation.
Here is the relevant language from MCL 500.3020:
(1) A policy of casualty insurance, except worker's compensation and mortgage guaranty insurance, including all classes of motor vehicle coverage, shall not be issued or delivered in this state by an insurer authorized to do business in this state for which a premium or advance assessment is charged, unless the policy contains the following provisions:
(a) That the policy may be canceled at any time at the request of the insured, in which case the insurer shall refund the excess of paid premium or assessment above the pro rata rates for the expired time, except as otherwise provided in subsections (2), (3), and (4).
(b) Except as otherwise provided in subdivision (d), that the policy may be canceled at any time by the insurer by mailing to the insured at the insured's address last known to the insurer or an authorized agent of the insurer, with postage fully prepaid, a not less than 10 days' written notice of cancellation with or without tender of the excess of paid premium or assessment above the pro rata premium for the expired time.
(c) That the minimum earned premium on any policy canceled pursuant to this subsection, other than automobile insurance as defined in section 2102(2)(a) and (b), shall not be less than the pro rata premium for the expired time or $25.00, whichever is greater.
(d) That an insurer may refuse to renew a malpractice insurance policy only by mailing to the insured at the insured's address last known to the insurer or an authorized agent of the insurer, with postage fully prepaid, a not less than 60 days' written notice of refusal to renew. As used in this subdivision, "malpractice insurance" means malpractice insurance as described in section 624(1)(h).
(2) An insurer may file a rule with the commissioner providing for a minimum retention of premium for automobile insurance as defined in section 2102(2)(a) and (b). The rule shall describe the circumstances under which the retention is applied and shall set forth the amount to be retained, which is subject to the approval of the commissioner. The rule shall include, but need not be limited to, the following provisions:
(a) That a minimum retention shall be applied only when the amount exceeds the amount that would have been retained had the policy been canceled on a pro rata basis.
(b) That a minimum retention does not apply to renewal policies.
(c) That a minimum retention does not apply when a policy is canceled for the following reasons:
(i) The insured is no longer required to maintain security pursuant to section 3101(1).
(ii) The insured has replaced the automobile insurance policy being canceled with an automobile insurance policy from another insurer and provides proof of the replacement coverage to the canceling insurer.
I hope this helps.
Attorney Gursten has given you a fantastic and thorough answer. I would only like to comment a bit having been an insurance agent for years. There is something that I think you are leaving out and I'm wondering what it is. Why was your first payment not enough? Did they discover more points on your driving record than you told them about? What kind of coverage did you have (PL/PD or Full Coverage)?
As Attorney Gursten mentioned, the time of day you paid and the time of day you had the accident matters. If you had an accident, then went into the insurance agency to get insurance later in the day, your claim will be denied. I am guessing, based on the dates you provided, that this is what happened. I think you knew you had no coverage on April 2nd when you got in an accident and then went and obtained insurance. I have seen this many times.
If I am wrong and you should have been covered and they refuse to pay, go to the link I provided below and fill out the complaint form on the last page. Send it to the Insurance Bureau (the address is on the form) and you should get some results. Good Luck!
Insurance Complaint Form: http://www.michigan.gov/documents/cis_ofis_comp_all_25074_7.pdf
The comments listed here do not create an attorney-client relationship. The comments are for informational purposes only and are not to be considered legal advice. This attorney is only licensed in Michigan and does not give legal advice in any other state. All comments are to be considered conversational information and you should not rely on these comments as legal advice or in place of retaining an attorney of our own. The comments here are based solely on what you have provided and therefore are general in nature and with more specific facts or details a different answer or outcome could result. The legal system is not a perfect science and this attorney does not guarantee any outcome.
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