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Insurance company doesn't have to pay truck accident claim

Driver Fails To Notify Insurance Company Of Accident In A Timely Manner

It’s important to let your insurance company know if you are in an accident! To drive that point home, a recent ruling by the Seventh Circuit Court of Appeals has ruled that a construction company’s insurer doesn’t owe a defense against allegations that a company truck hit and injured a woman because the driver didn’t report the accident to the insurer in a timely manner.

This decision reversed a district court that said State Auto Property and Casualty Insurance Co. had a duty to defend and indemnify the construction company. The ruling focused on the 21-month delay by the driver in informing the insurer of the accident. The Court ruled this delay was “inexcusable” under Illinois law.

“As a small‐business owner with two years of college and multiple insurance policies, the driver was sophisticated enough to understand that striking a person with his truck might lead to an insurance claim or a lawsuit,” the panel said. “But instead of notifying State Auto, he relied on his own assumptions that turned out to be wrong.”

The owner of the company hit a woman while backing out of an Illinois gas station in the company truck. The woman did not go to the hospital and drove herself home, causing the truck driver to assume the accident was too minor to report to State Auto, the Court said.

Almost two years later, the woman sued for damages worth more than $50,000 for alleged “permanent and permanently disabling injury; including injuries to her back and spine and the soft tissue structures thereof”. A day later, The truck driver informed his insurer of the suit, but the insurer argued that he had breached the policy’s notice requirement by waiting 21 months to report the accident.

The Court said that the policy’s language made it clear that the insurer wouldn’t have to defend someone who doesn't provide “prompt notice” of an accident, and that the truck driver should have known that his accident might result in a claim.

The Court then noted something that we are keenly aware of as personal injury attorneys. The Court said that “although everyone at the scene on the day of the accident apparently viewed it as minor, it is fairly common for individuals involved in automobile accidents to experience injuries that don’t manifest themselves until days, weeks, or even months after the accident,” the Court said.

All of this meant that the truck driver should have known that a claim was possible, but never reached out to the woman he hit to ask about a potential lawsuit. Furthermore, a “reasonable driver” would have at least asked his insurance company whether the accident was severe enough to be reported.

All of this means that, because the owner, didn’t provide a timely notice of the accident to his insurer, the insurer was denied the opportunity to “make a timely and thorough investigation and to gather and preserve possible evidence,” the Court said.

So, the lesson here is to always report any car accident to your insurance company, even if there don’t appear to be any injuries.

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