forced insurance

[mOK]

What is the name of your state? OK
I'll try to make this short. Purchased a truck in my name for my son to drive. He is making payments, he got full coverage insurance (everything) but didn't realize he needed to put the bank as lienholder, which we were in process of getting that done. The bank forces insurance on him/me (raises the payments) so he just goes with their insurance unaware that it was not the same coverage as what he originally had. He totals the truck and that is when we find he should have kept his original insurance because bank's forced insurance didn't pay off the whole note. My dispute is that the bank should have never forced insurance on us because we already had full coverage and were in the process of putting them as lienholder. Now my question is, were they wrong to force insurance and can I get back the $1300 for the premium paid?

 

[I AM ALWAYS LIABLE]

What is the name of your state? OK
I'll try to make this short. Purchased a truck in my name for my son to drive. He is making payments, he got full coverage insurance (everything) but didn't realize he needed to put the bank as lienholder, which we were in process of getting that done. The bank forces insurance on him/me (raises the payments) so he just goes with their insurance unaware that it was not the same coverage as what he originally had. He totals the truck and that is when we find he should have kept his original insurance because bank's forced insurance didn't pay off the whole note. My dispute is that the bank should have never forced insurance on us because we already had full coverage and were in the process of putting them as lienholder. Now my question is, were they wrong to force insurance and can I get back the $1300 for the premium paid?

My response:

Nope.

The bank had every right, under the contract that was signed with them, to add "single interest" insurance premiums to your monthly payment. They had every right to protect their "security interest" for the loan; i.e., to make you pay for "their" insurance, because they were NEVER notified that you had them as a "Loss Payee" on your son's insurance policy. In effect, they were NOT an insured on your son's policy.

And, to say "were in the process of putting them as lienholder" is useless because the bank had no idea WHEN they were going to become "protected" under your son's policy. So, it was prudent, and lawful, and per the contract, for them to insure their "security" and to make you pay for it. As you know, that "single interest" policy only covers the balance owing on the truck, and doesn't protect ANY interest your son might have in the value of the truck, nor does it protect him from any "liability" if the accident is his fault. Your son, in essence, and due to his "misunderstanding" of the insurance, and the law of insurance, was in effect driving around without insurance!

Obviously, it was "prudent" for the bank because your son "totaled" the truck before you had the bank named as an "insured" - - which, by the way, would have only taken a quick phone call to accomplish.

IAAL

 

[racer72]

The insurance wasn't forced on you, you agreed to a mandatory insurance provision when you bought the vehicle. As soon as you found out about the leinholders insurance, you should have shown proof that the vehicle was insured. You failure to know the insurance requirements in not a valid reason. You have no claim against anyone.

 

[mOK]

Thanks for your replies. Maybe this will help someone else avoid the same situation and pay closer attention. I know I will.