Good afternoon Mr Harriman, I would like your opinion or possible help with the following Issue. I was involved in an accident some time ago. No one injured. Yes eventually I was charged with the usual driving a vehicle without due attention. Now the car I was driving is not insured but the other was insured. So the lady opted to use her insurance to cover the cost of repair. Now after maybe more than a year, I have received a demand letter from the insurance demanding me to pay all costs of the repair which is P27,000.
Is this lawful? What is the purpose of insurance if after paying premiums the insurance company demand all costs from the offender? I will share the demand letter as directed by your response. Thank you always for your help.
The key issue here is that the other lady was paying for a vehicle insurance policy and that policy protects her, not you. She was paying her insurance company to take the financial risk on her behalf so if there's an accident they pay her bills and she doesn't suffer financially.
But neither should the insurance company pay the bills if it wasn't their client who caused the accident. They'll do their best to recover the money they spent compensating their client and the person they'll chase for that money is you. You were the one who caused the accident and your admission of guilt or conviction for driving without due care and attention is all the evidence they need that you're the guilty party.
The simple lesson is this. Insurance benefits the person paying for it and nobody else. That's why every vehicle owner needs it. This might seem hard to believe but you were lucky only to cause damage costing P27,000. I've heard of cases where people caused crashes that completely destroyed another vehicle and were faced with bills of over P500,000. If you'd had a third-party vehicle insurance policy your insurance company would have paid this bill for you.
I suggest you talk to the insurance company and negotiate a repayment plan you can afford because insurance companies don't forgive debts like this.
I also suggest you shop around for a third-party vehicle insurance policy so that if this happens again, you might be better prepared.
What is insurance?
There is such an enormous lack of understanding about insurance, how it works and who it benefits. It's worth spending a moment to understand what it is.
I found a nice quote on Wikipedia that said that insurance "is something people buy to protect themselves from losing money". It went on to say that consumers "who buy insurance pay a premium (often paid every month) and promise to be careful". In exchange for this, Wikipedia explains, "if something bad happens to the person or thing that is insured, the company that sold the insurance will pay the money back. However, there are some times when the company will not have to pay the money back, such as if the person was not careful."
These policies can cover a wide range of things, including property such as our house and belongings, our vehicles and even the vehicles belonging to other people that might be damaged when there's a disaster. They can also cover our lives and those of our loved ones and even our health. It can cover the health of our employees and the people who visit our offices. In all of these cases, if something bad happens that costs money, the insurance company will pay the costs instead of the policyholder.
However, it's very important to carefully read any policy you consider and make sure you understand exactly how it works. For instance some vehicle insurance policies don't cover you if you are charged and convicted or you admit guilt following an incident. Most life insurance policies won't cover you if you engage in dangerous sports or activities.
The commonest argument I hear against having insurance is that it's expensive. Well, firstly, it's NOT that expensive and it's sometimes a LOT cheaper than NOT having it.