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Needing Insurance Info for E&O
Old 01-15-2019, 08:45 PM   #1
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Needing Insurance Info for E&O

I posted earlier about an accident in our home last month. (My Truck Is In My Kitchen) Short story, a vehicle left the road, rammed into our garage, struck DH truck, launching the truck 35 feet into our house, taking out the kitchen and laundry room. Our home insurance is repairing our house.

We are snowbirds and reduce the collision on our vehicles when we are gone for the winter. DH had come back for a funeral, the damaged truck did not have collision. Our auto insurance will not pay because of reduced coverage. The car that caused the accident only has $20K coverage, but they will not pay out until our home repairs are complete and a release is signed. Our truck is totaled, value around $20K.

I'm concerned the $20K from the other insurance will go toward home repairs and will not be given to us for the truck. Our agent is the one who suggested dropping the collision coverage while the vehicle is not used over the winter. He tells us not to worry, that he has error and omission insurance and we'll get paid for the truck eventually. He admits he gave us incorrect advise to reduce the coverage. At the time, he said the truck would be covered for any loss that could occur while sitting in storage.

We are not feeling secure about all of this. Should we wait it out and see if the other insurance pays the $20K to us? And if they don't, wait to see if the agent's O&E policy pays out? Do we have to sue him in order to collect from O&E?
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Old 01-15-2019, 09:22 PM   #2
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Get a lawyer. The at fault party's insurer seems to be stalling... they are going to pay the $20k limit of coverage eventually one way or the other so there is no good reason for them to delay.

I'm not sure that the agent gave you bad advice... it is quite common for snowbirds to take off liability and collision for vehicles in seasonal storage. That said, his E&O carrier may honor a claim anyway.

Do you have umbrella coverage?

Why wouldn't the comprehensive coverage on the truck cover it? Per Allstate:
Quote:
Comprehensive insurance is a coverage that helps pay to replace or repair your vehicle if it's stolen or damaged in an incident that's not a collision. Comprehensive typically covers damage from fire, vandalism or falling objects (like a tree or hail). ...
Per State Farm:
Quote:
Comprehensive coverage pays to repair or replace a covered vehicle that's stolen or damaged by something other than collision or rolling over. For example, damage caused by fire, wind, hail, flood, theft, vandalism and hitting an animal is covered.
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Old 01-16-2019, 06:13 AM   #3
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I understood (perhaps incorrectly) that a vehicle damaged while in a garage would be covered under the homeowners policy, not the vehicle insurance.


That said, State Farm just autocratically re-issued new homeowners policy with lots of new restrictions, such as if a tree fall causes damage liability is limited to 1K and other nonsense.
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Old 01-16-2019, 06:19 AM   #4
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Get a lawyer. The at fault party's insurer seems to be stalling... they are going to pay the $20k limit of coverage eventually one way or the other so there is no good reason for them to delay.

I'm not sure that the agent gave you bad advice... it is quite common for snowbirds to take off liability and collision for vehicles in seasonal storage. That said, his E&O carrier may honor a claim anyway.

Do you have umbrella coverage?

Why wouldn't the comprehensive coverage on the truck cover it? Per Allstate:


Per State Farm:
I am curious why you think an umbrella policy would help here.
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Old 01-16-2019, 06:44 AM   #5
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The E&O Insurance Coverage on your Agent's "business insurance policy" will cover this issue for you. Your Agent needs to "make a claim" to the insurance provider showing his guidance to you and your loss was based on his "incorrect advice". That is exactly why E&O exists.

You should ask him this question...... "Have you had a chance to make a claim on your E&O coverage for my truck yet"?

He may be stalling, because E&O claims may raise his business insurance rates??

Good luck, and, have some patience. E&O claims move slowly through the insurance world. You WILL get paid if he makes the claim. Hopefully, he has already made the claim to his business insurance policy.
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Old 01-16-2019, 06:48 AM   #6
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If the other party only has 20K in liability, it will run out soon. Your house insurance is also in line to recoup through subrogation for the house damage. The other Insurance company will likely pay them first, and then tell you the coverage is exhausted. That will leave you pursuing the other party directly through your own attorney. Does the other party have any assets? You will have to get a judgement against them for the rest of your damages. I doubt that an Errors and Omissions policy with your agent will pay for the truck. I would have dropped the coverage also, but I would be in the same boat with you. I would talk to your Insurance company about getting your 20K first and let them go after the other party to get their house repair money back.
Your Umbrella coverage will not cover the other parties liability, and they surely have no Umbrella coverage.
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Old 01-16-2019, 07:28 AM   #7
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I am curious why you think an umbrella policy would help here.
I guess I was thinking that umbrellas are generally fairly comprehensive, and is the OP had an umbrella that had uninsured motorist coverage then perhaps it might apply.
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Old 01-16-2019, 07:30 AM   #8
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Cautionary warning. Don't presume E&O will cover this. I can see at minimum an arguable defense that the suggestion to reduce collision coverage was not an error, but instead reasonable advice to a snowbird.
I agree you should retain a lawyer.
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Old 01-16-2019, 07:36 AM   #9
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I guess I was thinking that umbrellas are generally fairly comprehensive, and is the OP had an umbrella that had uninsured motorist coverage then perhaps it might apply.
Interesting angle.
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Old 01-16-2019, 07:42 AM   #10
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I'm still wondering why the OP's comprehensive doesn't apply. Seems pretty straightforward.

Unless perhaps they took all the insurance off, rather than just the liability and collision leaving the comprehensive on.

if that's the case, they probably would have a very valid E&O claim against their agent.
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Old 01-16-2019, 07:46 AM   #11
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.... Your Umbrella coverage will not cover the other parties liability, and they surely have no Umbrella coverage.
I'm thinking the umbrella might apply if they have uninsured motorist coverage under the umbrella which is fairly typical.
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Old 01-16-2019, 07:47 AM   #12
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Did you have uninsured/under insured on your auto? It sounds to me that you had an accident that where you have someone else at fault and they have little insurance. Sounds like this is what you would want. The umbrella sounds like it is not the correct insurance.
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Old 01-16-2019, 07:49 AM   #13
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Quick summary: Comprehensive won't cover it, this was a "collision" loss.
Umbrella won't cover it, neither will Uninsured/Underinsured Motorist coverages. Homeowners won't touch any damage to an auto. The OP's vehicle needed to have Collision coverage.


It is not at all uncommon for people to remove liability & collision coverages while parking an auto for extended times. Remember that the Agent's E&O insurer will provide them a defense and will be asking you questions too, such as: "Did you ask your agent if you could save some money when you park your car for the winter ?"
The agent will likely have a deductible on their E&O policy, the company will pay it if they lose and then send the agent a bill.


If the responsible party had $20,000 of Property Damage liability insurance and your auto was worth $20,000, could you just apply that coverage to your loss there and let your Homeowners policy pay you for the damage to your house ? Would you be out more than your Homeowners Policy deductible ? If so, would it be more than it would cost to hire an attorney ?
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Old 01-16-2019, 07:50 AM   #14
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I'm still wondering why the OP's comprehensive doesn't apply. Seems pretty straightforward.

Unless perhaps they took all the insurance off, rather than just the liability and collision leaving the comprehensive on.

if that's the case, they probably would have a very valid E&O claim against their agent.

Comprehensive does not cover collisions.
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Old 01-16-2019, 07:59 AM   #15
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I understand that... but if your truck is parked in your garage and is damaged (roof caves in, tree falls on garage, garage door opener falls off ceiling, etc.) then comprehensive provides coverage.

So if another vehicle smashes into the garage and destroys the truck, is that a collision or not? I suggest that it is questionable, and more akin to a tree falling on the garage... which would be covered by comprehensive.
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Old 01-16-2019, 08:32 AM   #16
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I understand that... but if your truck is parked in your garage and is damaged (roof caves in, tree falls on garage, garage door opener falls off ceiling, etc.) then comprehensive provides coverage.

So if another vehicle smashes into the garage and destroys the truck, is that a collision or not? I suggest that it is questionable, and more akin to a tree falling on the garage... which would be covered by comprehensive.
Good question, but no. This is a clear cut "collision" loss. An exclusion would be found under the "other than collision" coverage, which is the correct term for comprehensive coverage.

This is a situation many people don't realize when removing collision coverage from an auto.
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Old 01-16-2019, 10:09 AM   #17
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I'm still wondering why the OP's comprehensive doesn't apply. Seems pretty straightforward.

Unless perhaps they took all the insurance off, rather than just the liability and collision leaving the comprehensive on.

if that's the case, they probably would have a very valid E&O claim against their agent.
Comprehensive coverage would not cover a collision- this is a collision or UMPD Under-insured Property Damage. This damage was caused by another collision. If a tornado picked up his truck and sent it into the house, it would be comprehensive.

I am retired claims guy, not always right, but better % than the average Joe.

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Old 01-16-2019, 10:14 AM   #18
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"Umbrella policies can provide excess liability for auto, homeowners, boat, and renters insurance. ... Umbrella policies do not cover physical property damage. This means that damage to your own home or vehicle would not be covered by your umbrella insurance."
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Old 01-16-2019, 10:32 AM   #19
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Comprehensive coverage would not cover a collision- this is a collision or UMPD Under-insured Property Damage. This damage was caused by another collision. If a tornado picked up his truck and sent it into the house, it would be comprehensive.

I am retired claims guy, not always right, but better % than the average Joe.

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Not sure of the facts in this case, but if the at fault vehicle hit the OP's garage and the garage collapsed on the OP's truck and the at fault vehicle never made contact with the OP's truck is it still a collision?
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Old 01-16-2019, 10:33 AM   #20
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"Umbrella policies can provide excess liability for auto, homeowners, boat, and renters insurance. ... Umbrella policies do not cover physical property damage. This means that damage to your own home or vehicle would not be covered by your umbrella insurance."
But I was referring to UM umbrella coverage.
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