I have a question about lapse of car insurance?

Question

I have a 2004 Cadillac Escalade that I got in an accident with. The damage is $16,400 and there is $27,000 left on the payoff. I found out my insurance cancelled the month before because my debit card number on file changed, and I was out of town didnt get the notice etc. Doesnt the lienholder automatically put coverage on the car when they receive notice of insurance cancellation and isnt it retroactive to the day of the cancellation? And if so, do they just sell it wholesale as damaged and pay off the lien or is it actual comp and collision insurance and I may get the car back?

Answer 1

When you financed the car, you agreed to keep full coverage insurance on the vehicle, and to name the finance company as a loss payee.

No, the lien holder doesn't *have* to put coverage on if you neglect to do as you promised.  The can, and it tends to be very expensive when they do, but there is no requirement for them to do so.

IF (and there is the big question) you were not covered at the time of the accident, and apparently you were not if I'm reading your question right, YOU are responsible for paying everything, including the $27,000 still owed, out of pocket.

If they did put coverage on, you would have received a bill from them for doing so.  If you didn't get that bill, they didn't put coverage on.  And if they did put it on, it would only be protecting their interest, not yours.

Best call and find out.

Answer 2

If they had put insurance on the car, you surely would know about it by now.  Even so, You are still responsible for what you owe on the vehicle and if there was no insurance, you must pay for the repairs if you choose to have the car fixed.

Answer 3

you are solely responsible for the insurance.it may be sold then youd be responsible for the balace. you can buy the car back if the insurance company was involved  BUT WITHOUT IT IM NOT SURE.

You'll want to research this some more....

http://www.surveyland.org/jump.php?link=...

Have a nice day.

Answer 4

I would be worried if this happened to me. The lien holder has a right to put insurance or force a customer to pay for insurance if the car becomes uninsured. However, the insurance company probably wouldn't have been notified in this amount of time of the lapse to take proper action. It sounds like your insurance was just cancelled as you went out of town because your debit card changed. There is no way that the lien holder had took action within a few days or so. This being said, you will be liable for the damages of this vehicle and any other vehicles or property in the accident. You will have to continue to pay for this vehicle even it is not drivable or looks bad. There is no easy way out on this one. I hope that everyone in the world can benefit from this incident. This is why it is so important to keep insurance, it always seems that bad things happen the day you don't have it. Check out the blog below to find out more on lapse auto insurance coverage.