What is considered business use of a vehicle?

KJFloyd7 · #1 10-11-2006, 11:33 AM

What is the name of your state? Florida

My fiancee was in a car accident 1 month ago today in which he was at fault. It was a simple accident with no injuries. My insurance company has been giving me the run a round and not returning phone calls. I have called everyday since the accident and finally spoke to the adjuster once. She said she had to discuss the situation with my fiancee which she finally did a week after talking to me. She was supposed to call me the next day and discuss the pay out offer, which she never did. I finally had enough and yesterday called the Insurance Commisioners Dept. to complain. Well apparhently my insurance company did not like this, but they finally called me after that and now they are trying to say that it is not covered because they feel that it was being used for business. My fiancee is a carpenter and though yes we do have a business liscence to do sub contractor work, he is not doing any at this time and works by the hour for someone else. He also had a passenger with him that they are trying to say is our employee, and that he was towing a trailer that this was being used for business. So what do I do now, and how do I fight this? Any help is appreciated.What is the name of your state?

ecmst12 · #2 10-11-2006, 11:41 AM

You can submit evidence that he was not using the car for business. Or you can go to court, where the burden would be on THEM to prove that he was using the vehicle outside the restrictions of his policy. I believe this is a case where you could sue an insurance company since they seem to be in breech of their contract with you.

KJFloyd7 · #3 10-11-2006, 11:55 AM

Thank you so much for your quick reply. Business use of a vehicle I found is defined as the usage of a vehicle used primarily for the business duties of the operator of the vehicle. Simple driving to and from the principal place of occupation, profession, or business is considered COMMUTING and DOES NOT qualify as business use.

Therefore that alone should be enough right? He works on a jobsite and was going to his place of employment. I dont see what the trailer has to do with anything since it is not part of the claim and there is no law stating that you have to insure a trailer you are towing right? If it is attached then it is covered, but the trailer wasnt hurt, and isnt part of the claim. They are just trying to make excuses for their slowness on this matter. They also without my knowledge made him do a recorded statement over the phone on this. Where do I go from here? Do I call the Insurance Commisioners Office again or do I call my insurance company and tell them they are crazy?

ecmst12 · #4 10-11-2006, 12:03 PM

They ALWAYS take a recorded statement, that's standard procedure for all insurance companies. They always make sure the person being recorded is informed and the consent to be recorded is part of the statement. Don't worry about that.

Personally, I would give the insurance company one more shot to do the right thing, maybe talk to a supervisor. If that doesn't work, the next step would be the insurance commissioner and/or small claims court.

moburkes · #5 10-11-2006, 12:19 PM

ecmst, not so fast. If the insurance company determines that the vehicle is used for busines, and the policy specifically excludes this type of coverage, then they can deny the claim for material misrepresnetation. They can, instead of paying the claim, retroactively cancel the policy (which is NOT good) and return the premiums.

OP: He is a carpenter. He is a subcontractor. He was going to a jobsite. What was he doing at the jobsite? What was in the trailer? Apparently, the trailer was attached to the vehicle at the time of the accident, right? How many jobsites does he visit each day? Each week?

Commuting is generally traveling to your place of business (usually a fixed location that does not change from day to day), parking your vehicle, maybe using it on lunch, getting back in at the end of the day, and heading home or wherever.

Business use can include: signs or lettering on your vehicle advertising your business, vehicle registered to a business, picking up/and or delivering product for work (was there carpet/pads in the vehicle or trailer?), hailing more than a few hundred lbs of equipemnt for work, etc.

Other examples of business use are: Avon or Mary Kay lady, real estate agent, pizza delivery, newspaper delivery, etc.

ecmst12 · #6 10-11-2006, 12:30 PM

They would still need to have some kind of evidence that the vehicle was being used for business, merely the fact that he has a subcontracter's license is not proof that he was working as one at the time or using his vehicle as part of his business. They seem to be saying, you own a car and you own a business, therefore you MUST have been using your car for business, and that logic doesn't fly. If there is other evidence of business use, obviously that would be taken into account but they should at the very least have better rationale then the above for claiming business use.

moburkes · #7 10-11-2006, 12:34 PM

Well, yes and no. I'm talking about material misrepresentation. If the vehicle is used for business, AND that wasn't disclosed to the company, AND had the company known, they would not have insured the customer for a personal auto policy, then they can do what I described above. But, the adjuster has spoken, apparently, to the fiance, and may have statements that back up his viewpoint. Also, OP admits that vehicle was pulling the trailer at the time of the accident, and that finace was on his way to jobsite. That's why I asked the additional questions.

KJFloyd7 · #8 10-11-2006, 12:37 PM

What was in the trailer was his equipment that he personally uses at work. It is a very small trailer, under 200 lbs completely loaded. It has air hoses, air guns, air compressor, generater, saws, power cords, nails, tool bag, etc. All the items he personally uses. He is on a jobsite with a bunch of other people who have the same setup on their own vehicles with their own tools. He was not delivering any goods or products. We build new construction so the jobsite is the same spot for up to 2 months at a time. Not to mention that he is building in the same development, just the jobsite changes, you know next lot over and such.
He works for somebody else by the hour and the person riding with him works for the same guy also. They were carpooling which most insurance companies appreciate and encourage. The passengers trucks engine blew up and he lives next door so it is not like my fiancee was doing pickup and delivery of his employees, cause this guy is not our employee. He has a business liscence also and all his own tools.

moburkes · #9 10-11-2006, 12:42 PM

I'm assuming that the 2 of you are on the same policy. Does your insurance company know that you also use this vehicle for side jobs?

Based SOLEY on what you have described, I would ask the insurance company to show you in writing why the accident is excluded from coverage. They are required to give their denial in writing, but tell them that you are expecting it within 10 business days.

ecmst12 · #10 10-11-2006, 12:44 PM

Perhaps submitting paperwork showing the employer-employee relationship for your fiancee would help. It sounds like this should be considered normal commuting use not business use. OP did mention that neither of them are doing any side jobs or subcontracting at this time.

moburkes · #11 10-11-2006, 12:49 PM

It does sound like commuting, except for the fact that he is pulling tools for work. Commuting generally does not include pulling a trailer for work. THAT is the battle that he will be fighting. The trailer full of tools. You don't have to be self-employed to use the vehicle for business. In OP's fiance's case work and business are the same (based on his occupation). The business license, and the passenger as subcontractor for driver won't fly as excuses. But the trailer with tools is the problem. Do you have a copy of your policy? The THICK part of the policy, not the 1-page dec page. If so, review under liablity coverage, the exclusions. Also, there should be a section defining the acceptable uses of the vehicle.

But you never answered me: Does the insurance company know that the vehicle is used for business?

ecmst12 · #12 10-11-2006, 01:09 PM

I think it's pretty common, though, for construction workers to have to own and maintain their own tools even if they are not working as contractors. It's not like he was hauling materials for the job or anything like that. It would be equivalent to a very heavy laptop that he has to bring to work every day

moburkes · #13 10-11-2006, 01:11 PM

Quote:

Originally Posted by ecmst12

I think it's pretty common, though, for construction workers to have to own and maintain their own tools even if they are not working as contractors. It's not like he was hauling materials for the job or anything like that. It would be equivalent to a very heavy laptop that he has to bring to work every day

I agree 100%. No ifs, ands, or buts. That doesn't mean that its covered by the insurance company, though.

added: People often do not inform their insurance companies about certain things (like not wanting to add a 16 year old to the policy once they are licensed), because of the associated high premiums, but they want the insurance company to take responsibility for paying the claim, when it happens.

KJFloyd7 · #14 10-11-2006, 02:01 PM

I didnt keep anything from my insurance company. When I went and applied for insurance they knew that we were carpenters and that we towed a trailer. We dont deliver anything but ourselves. We dont haul around lumber from job to job, or anything like that. We go to the jobsite and come home unhook the trailer and he goes about his business of doing whatever else. I dont drive the truck at all. It is his personal vehicle. Now when i was working on the job I took my own car and the trunk was loaded with my tools I needed. Now the place I applied at was just an underwriter and friends of the Contractor that we were subbing from at that time 2 1/2 yrs ago. They knew exactly what we did. They said it fell under "personal use". Now my primary insurance company is just having a fit because i turned them in to Financial affairs and are trying to get out from under it. So they are pulling this out of a hat. It had already been decided that it wasnt a business vehicle until now. Now that they are mad.

moburkes · #15 10-11-2006, 02:06 PM

Believe me when I say this: turning them in to the Dept of Insurance will NOT make them deny your claim. That will get them in more hot water, and they know this! The problem, like I stated earlier is that he was pulling the trailer with work tools and he was on his way to a job site. Read the policy to SEE if there are specific exclusions for that type of use of the vehicle.