Driver's License and No Insurance

A few months ago I wrote here about the laws that have been passed that permit insurance company's to have your driver's licenses suspended if you don't pay their demand for subrogation. They do this by asking the Department of Safety to require you to pay in the amount of the subrogation claim and the penalty for failure to do so is suspension.

The course of events in the case I was handling was as follows:

My client was involved in an accident. He was not cited as being at fault by the investigating officer. The other driver's insurance company paid to have that car repaired. They then sent my client a letter saying "We have determined that you were at fault. Please pay us $3,000.00, which is the amount of the claim we paid our insured." My client refused, since he wasn't at fault and there had been no determination by any court that he was obligated to pay anyone anything. The insurance company then sent a claim to the Department of Safety asking them to require my client to pay in to them $3,000.00 "pending a determination of fault." Still no court case was filed. My client received a letter from the Department of Safety informing him that he must pay or face suspension of his license.

We appealed and had a hearing that focused on the issue of fault. The insurance company did not send anyone to the hearing.

The decision came down this week. My client was found not to be at fault and his license will not be suspended.

But he is out several thousand dollars in legal fees - all caused by an insurance company pursuing a subrogation claim that they had no right to pursue. I am wondering whether they ought to face some kind of liability there for his out of pocket expenses or other damages.

In any event, this happens on a regular basis. I actually had another client call last week with the identical problem. He hasn't decided whether to retain me to appeal that one, but I hope he does. Only by standing up for yourself will things begin to change.

~Tim