Upon buying my son a car I asked him to go immediately to the insurance company and have insurance put on the newer vehicle. The negligant insurance agent at the insurance company didn't ask any questions (are you on the title, is their a bank loan, etc.) and put only liability on the vehicle that had a bank loan on it. Shortly after purchasing the vehicle my son was in a near death accident and the car was totalled. When I called the insurance company to report the accident they then told me that there was only liability on the car. I was shocked to say the least. The owner of the insurance company said, "the insurance should have never been written". I now have $12,000 on my credit report as having not been paid and my credit is ruined. Any suggestions as to what I should do now? I feel the insurance company was negligant and should be responsible for the $12,000 as they are the ones who made the initial mistake.

Sorry Larry, you're wrong here. The owner of the vehicle is responsible for securing the insurance on the car, not the insurance company. At any point did either you or your son verify the coverages? The insurance should match the vehicle registration (was it in your son's name or yours?) You said you sent him to "get insurance", did you tell him what coverages he needed to add? Assuming he must be fairly young (since you said you purchased the vehicle for him), I would guess that he has no clue about auto insurance. What reason did the agent give for saying "the insurance should have never been written"? It was your responsibility to tell the agent that the car was being financed and therefore that you needed more than basic liability coverage on it.

I feel the insurance company was negligant and should be responsible for the $12,000 as they are the ones who made the initial mistake.

I would agree that the insurance company was negligent in not doing a full interview and advising what would be the best coverage for the vehicle.

However, I disagree that they made the initial mistake. I think YOU made the initial mistake by not explaining insurance coverage to your son and telling him what coverages to get and what questions to ask. And that mistake is going to be very expensive for you. Because it absolves the insurance agent of any liability. If you want to contact an attorney I'm sure they will tell you the same thing, that you have no case that will succeed in court.

Yes, the agent should have tried to sell him all he could, but then what did the "son" tell them, if he merely told them he got another car and to transfer the coverage, but the agents normally ask them what coverage they want,

So in the end there is no "LEGAL" liablilty since the person who owns the car is the one responsible.
In fact the car lot should have never let you off the lot, they normally require you to have full coverage before driving off the lot if there is a loan on the vechile.

In the end, you have no case what so ever

Only the named insured is supposed to be able to make changes to the policy or the additional named insured... like the spouse who is on the policy or any one on the policy that the Named Insured designates.. If the son is not the named insured or additional named insured. He should not have been allowed to make any changes... the agent can make changes but he should have the Named Insured permission... Texas.. If anyone can make changes to a policy, then anyone can walk in and add a vehicle to YOUR policy... check out this information .

...or any one on the policy that the Named Insured designates..If the son is not the named insured or additional named insured. he should not have been allowed to make any changes...

The OP already told us that he designated the son to secure the insurance so this is a moot point.

I know, but the insurance company has a legal responsibility to identify the person making changes to the policy... The agent is bound to the same rules... I understood that the agent took the sons word without contacting the named insured... check with the company that the policy is written with.. not the agent... or the State Board of Insurance...

The fact is, we don't know how this policy was set up. It could've been Larry X and Larry X, Jr. for all we know. If so, the son had a legal right to make changes to the policy.

And the fact remains that the OP explicitly stated that he gave his son permission to make decisions regarding the insurance.

It's agreed here that the agent should have asked more questions about financing/lien info but it was ultimately the OP's responsibility to properly insure the car.

Closed, Polly is opening older threads