Insurance takes no-questions-asked approach on claims

  • Article by: JIM FOTI , Star Tribune
  • Updated: September 19, 2007 - 9:51 PM

They survived after a bridge fell from under their wheels, but they couldn't escape a mundane and oft-dreaded task: calling the insurance company.

They survived after a bridge fell from under their wheels, but they couldn't escape a mundane and oft-dreaded task: calling the insurance company.

Fortunately, the companies knew exactly where these drivers were coming from.

"When you say that you were on the bridge ... everyone knew what you meant," said Jean Forster, who was driving home to St. Paul when the Interstate 35W bridge went down. "You didn't have to say much more than that."

Forster's Toyota Prius was among the 100 or so vehicles still on the bridge after the Aug. 1 collapse in Minneapolis, and she's one of the people who know firsthand how insurance companies handled this unusual event -- and why they're keeping some cars that would otherwise belong in the junkyard.

Several major insurers, including State Farm and Progressive, decided that vehicles that remained on the bridge would be declared a total loss, allowing the owners to receive checks so they could buy new cars.

"It's clearly a covered incident. ... That wasn't ever a question," said Mark Kulda of the Insurance Federation of Minnesota.

Kulda said one reason that many insurers took a no-questions-asked approach was that the number of vehicles was relatively small.

"This wasn't like we had 15,000 claims to adjust. ... It wasn't a hailstorm at rush hour."

Bill Walsh, spokesman for the Minnesota Department of Commerce, said his department had received only one call about insurance issues related to the bridge collapse.

That call came from Sandy Cermak of Dellwood. She said in an interview that she and her husband, Dan, had owned their Nissan SUV for only three months when they headed toward the Twins game on Aug. 1.

When a northern section of the bridge deck suddenly bent toward the river, the SUV dropped with it and bounced hard a few times. Cars in front of them plummeted off the edge, but Dan Cermak was able to bring his vehicle to a stop.

The passenger-side door that Sandy Cermak left open in her haste was visible in numerous news photographs.

The SUV didn't look much different, but after it was transported from the bridge to the impound lot to a body shop and then a dealership, the Cermaks learned of the damage: the gas tank had moved, a strut was broken, the oil pan was cracked, and mechanics suspected that the frame was bent.

"We didn't want to be unreasonable, but we became convinced that we didn't want this car back," she said.

Concerned that her insurance company, AIG, wanted to pay to repair the vehicle rather than declare it a total loss, she contacted the Department of Commerce. And during the wait for replacement parts to arrive, her 30 days of insurance-paid car rental ran out (the body shop picked up a few more days, she said).

Her husband eventually e-mailed some higher-ups at the insurance company, and last week, 42 days after the collapse, the couple got a call saying that the company had agreed to total the vehicle.

Joe Norton, a spokesman for AIG in New York, said Friday that the company had since sent a letter of apology to the Cermaks and that he believed the matter had been resolved to their satisfaction.

Kulda, of the insurance federation, encourages consumers to take action if they aren't getting the response they want from insurers. And he says that car buyers should consider taking out a "gap" policy so they don't end up "upside down" in the event of a total loss -- that is, still owing money on a car because the insurance payout is less than the loan amount. (Such policies are a one-time payment, he said, with the more expensive ones being around $200.)

The Cermaks will get $3,000 less for their SUV than they paid for it, Sandy Cermak said.

A faster resolution

Forster had just passed over West River Parkway on her way home from her job as a professor at the University of Minnesota's School of Public Health when the bridge went down, with her Prius on it. State Farm declared her car a total loss, and she was happy with the insurance payment she received for the Prius, a model known for holding its value. "I got almost as much as I paid for it. It was 18 months old. So that was fantastic."

State Farm is keeping Forster's car and others as evidence in case it can recoup some of its expenses from other parties once the collapse investigation is complete, said Sonia O'Brien, a spokeswoman for the company. State Farm handled roughly 25 claims related to the collapse, she said. Most were handled under the comprehensive portion of the policy, though at least one policyholder who didn't have comprehensive was able to file a claim under a collision policy.

The firm did also pay a few repair claims for cars involved in minor collisions on the parts of the bridge that didn't collapse, she said.

Insurance companies are used to disasters, but O'Brien said, "This is something new for us -- and everyone else."

Jim Foti • 612-673-4491

  • INSURANCE HELP

    • Minnesotans who are having a dispute with an insurance company can call the Minnesota Department of Commerce's Consumer Response team at 651-296-2488 or 1-800-657-3602.

    • More information about the insurance complaint process is available at www.startribune.com/a3356

    INSURANCE HELP

    Minnesotans who are having a dispute with an insurance company can call the Minnesota Department of Commerce's Consumer Response team at 651-296-2488 or 1-800-657-3602.

    More information about the insurance complaint process is available online at www.startribune.com/a3356

  • get related content delivered to your inbox

  • manage my email subscriptions

ADVERTISEMENT

Connect with twitterConnect with facebookConnect with Google+Connect with PinterestConnect with PinterestConnect with RssfeedConnect with email newsletters

ADVERTISEMENT

Advertisement
Golden Gavel by Star Tribune

Countdown to great deals

Bid Sept. 21-29

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

question of the day

Poll: How will the Vikings and Gophers do this weekend?

Weekly Question

ADVERTISEMENT

 
Close