Lawyer to sue insurance agent

[Eduard Alexander]

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This is a very long story but I'm gonna keep it as short as possible. I got an insurance quote for $2400 a year which comes to $200 a month. After the first payment I got a notice saying that my insurance went up to $450 a month which comes to $5400 a year. When i went in for a quote, the agent set a policy for me and my dad in such a way that the tickets we have on your record goes under one person. We told him multiple times that I have a 15 km/h over and my father has a 15 km/h over ticket as well. And so he gave us the $2400 a year quote. As mentioned before the next payment went up to $450 a month and he notified us that there was an "error in the system", in order words someone messed up big time and only took one ticket that was 15 km/h over the limit into consideration. So that's why when the next payment came, it went up to $450 instead of $200 because now the quote was for two tickets going 15 km/h not one. To the extent of my knowledge, I know that if you get a ticket after you get a quote then your insurance will go up. However we already got a quotation and never gotten a ticket after the quote and the deal was made. I went in to discuss with him and he verbally let me know that the policy will cancel by itself on June 20th. ( i got the insurance april 6th ). Also, even before we got the bike which was a honda cbr600rr we asked him multiple times if there will be any penalties or fees for cancellation and he said no. We lost a lot of money because we sold the bike and barely rode it, like 2 months only. We overlooked the fact that he or the insurance company messed up and just left things as they were. In the past months we have been receiving notices that we owe them $1200 for 2 MONTHS worth of insurance, that's half of what the original quotation was for 12 months and we do not want to pay because they messed up and they also want money for services they did not offer. I sold the bike and i verbally let the agent as well that I did. As I mentioned before the agent said that the insurance will cancel by itself and that there is nothing to worry about. Now a collection company is after us to pay up the $1200 and the agent that verbally told us that there will be no cancellation fee or any penalties is twisting his story up and says that there needs to be a written cancellation because he needs our consent to cancel it. In other words we are looking for a lawyer that is professional and has a good reputation when dealing with insurance companies. We would much rather pay a lawyer to take legal action against them than pay them for their mistakes, I meant it's just not fair. The only reason we seek legal action is because the collection company will be suing us on their part and we only wish to defend ourselves so that we do not go on the "black list". If anyone could recommend a good lawyer I would highly appreciate it! Thank you and sorry for the long post!

PS: After the incident I looked on goggle for reviews and this is not the first time someone takes legal action against him and his fraudulent actions. Also, any suggestions or advice is very welcome, my email address is eduardalexander23@gmail.com. I don't know if it matters but on a side note, the company we're dealing with is State Farm. Cheers guys!

 

[Sadz]

It doesnt sound like there is a cancel fee or penalty...sounds like the $1200 is from the policy. If there were a penalty you would probably be looking at $1500-$1700 still owing.
As well...ALWAYS HAVE STUFF IN WRITING!!! NO DEFENCE FOR WORD OF MOUTH AGREEMENTS.

 

[mimico_polak]

When i went in for a quote, the agent set a policy for me and my dad in such a way that the tickets we have on your record goes under one person. We told him multiple times that I have a 15 km/h over and my father has a 15 km/h over ticket as well.

How is this even legal? A ticket goes on YOUR record, and it can't be transferred to another person. Sorry but this is where you should've stopped the discussion right there.

You got greedy and wanted to beat the system.

- YOU know you have a ticket
- YOU know your father has a ticket
- YOU should know you can't put both tickets under one person
- YOU knew you were gaming the system and you got caught
- YOU trusted the verbal word of a guy who was knowingly trying to game the system for you

Sorry. No sympathy here.

EDIT: All the guy has to say in court is "Your honour they told me that they didn't have any tickets, and then after we issued the policy it turned out they both had a ticket. I didn't know."

 

[TorontoBoy]

Before you seek a lawyer and incur added expense, find out State Farm's ombudsman and ask for help. If the ombudsman is unable or unwilling to help your next step is to contact FSCO Financial Services Commission of Ontario, who regulates insurance companies in Ontario. File a formal complaint. The complaints link is on their front page, so this must be very common.

I read your post and still did not understand all the intricacies. I'm not sure how the two tickets can be combined to penalize you, it sounds very odd. Usually each insured is assigned a risk rating, and the policy is written up for the person with the highest risk rating. Your big block of text makes it harder for me to understand. Also some dates are missing.

Q: My insurance agent/broker quoted a premium that I agreed to and I bought the policy. Now I got a notice that the premium is more than they quoted. Can they do this?

A: An insurance company has sixty days from the effective date of the policy to review the application and confirm the information provided. It may adjust the quoted premium, which is an estimated premium, based on that review or underwriting process. The insurer must notify the insured of the revised premium in writing.


Q: Why does an insurance company charge me a penalty if I want to cancel the policy in the middle of the policy term?

A: The Statutory Conditions in the Ontario Automobile Policy (OAP 1) state that an insurer may use a short rate cancellation table when an insured requests a cancellation of the policy, and most companies follow that practice. This cancellation table takes into account administrative or handling costs involved with issuing the policy and cancelling it before the expiry of the term.

source

Also note that motorcycle insurance premiums are not evenly divided into 12 calendar months. You will pay more for the months you ride and almost nothing for the winter. For example if your premium is $200/mo for a year-long policy, and you ride only April and May, and then cancel, you'll certainly not pay only $400. Since you usually cannot ride Nov-Feb, the $200/mo for these months will be proportioned to the riding months at a specific ratio. You will, therefore, pay a much higher fee than $200 for the two months.

The insurance industry is highly regulated and there is help for consumes. Few of us here are fans of the insurance industry. Do your homework first, then seek a lawyer if and when everything else fails. You'll need to go through all these steps anyway, lawyer or not.

Whatever you do ensure that you do not get a "refusal to pay" or "denied insurance" comment on your insurance record, or you'll never find reasonable insurance in Ontario again. Insurance companies will black list you and you and your Dad will be screwed. They are an oligopoly and have some advantage, hence the reason they are highly government regulated.

 

[JoeyB]

To save your credit rating, pay the money. Then try to fight to get it back, but as mimico has stated good luck with that. You tried to game the system and it didn't work out for you. You lose.

 

[PrivatePilot]

It's in your best interest to try to resolve the issue amicably through the ombudsman or politely via senior / upper levels of customer service BEFORE resorting to legal action. Write a polite letter to the office of the president if none of the other steps help.

I'd exhaust every single other possibility before resorting to getting lawyers involved. They have more and better lawyers than you or I could ever afford and they're likely dig in their heels instead of trying to find a mutual or amicable resolution if you immediately start threatening legal at them. Sure, you may win in the end (although I'm not saying you're right, you might also loose..) but you'll have spent more than the cost of the policy for the year in the end on lawyers by the time you even get to court, trust me.

 

[Kedo]

.

I'd exhaust every single other possibility before resorting to getting lawyers involved. They have more and better lawyers than you or I could ever afford and they're likely dig in their heels instead of trying to find a mutual or amicable resolution if you immediately start threatening legal at them. Sure, you may win in the end (although I'm not saying you're right, you might also loose..) but you'll have spent more than the cost of the policy for the year in the end on lawyers by the time you even get to court, trust me.

This.!!
You may feel better but likely it will be a moral win.
Quick math.
How many hours to go to trial? Cost of lawyer hrly & retainer required is...
Does it look like a financial win or will you just feel better and still be out of pocket.

 

[TorontoBoy]

These monthly premiums are for Primmum but might be similar for State Farm:

TD/MM/Primmum uses the following premium-earning schedule for Motorcycles:

• JAN: 0.0%
• FEB: 0.0%
• MAR: 5.0%
• APR: 10.0%
• MAY: 10.0%
• JUN: 20.0%
• JUL: 20.0%
• AUG: 20.0%
• SEP: 10.0%
• OCT: 5.0%
• NOV: 0.0%
• DEC: 0.0%

Insured April 06 - June 20. Just rounding April 10%, May 10%, June (3/4 of the month) 15%: total 35% of yearly premium. State Farm says $450/mo or $5400/yr. 35% of $5400 = $1890. This is an approximation of what you owe them, insurance premium only and no cancellation fee. How much did you pay and what is the difference?

If you paid them your original premium of $200/mo for ~2.75 months, or a total of ~$575, then you owe them ~$1315. This is close to the $1200 State Farm is asking from you. If this is so, then pay them.

 

[Chasem]

As somebody who uses a Collection agency to get money......... I can only laugh at the concept of them trying to "sue" you. Seriously that is beyond jokes. I highly doubt that is going to happen.


FYI there are only a few collection agency's that can actually negatively affect your credit. You can quite calmly tell the collection agency to go **** themselves. They will keep harassing, after awhile they will offer you a "settlement", and you can keep working them lower and lower. After awhile they will only want to get the recovery fee back.

Even if they manage to get a ding on your credit report, you can easily dispute that AND have it removed (If they side with you).

Seriously read this: http://www.ontario.ca/page/collection-agency-your-rights

BTW using deceptive tactics like threatening lawsuits from a collection agency is illegal.


Unless you have deep pockets, I would avoid the lawyer route. No offence, but if you are squabbling over $1200.... You don't have the funds to effectively sue him over the issue as I understand it.



EDIT: OP, I was being facetious... don't actually tell the collection agency to go **** themselves. Sorry I can be kinda dry...

 

[hedo2002]

Let's also not forget if you go the route of a lawyer and try to sue them, and they win they can then ask the court to order you to pay their legal fees and expenses, which could be tens of thousands of dollars.

But I agree with Torontoboy I doubt there is a cancellation fee in the $1200 but that is the premium for actual months the plicy was in effect. You have to use the prorated and not just base it on the $200 monthly, (which it never really was going to be $200, the agent tried to "play fast and loose with the rules" and you were complicit in the scheme.

The insurer, (it "appears"), notified you of the increased premium within the 60 days as required by FSCO.

As for the cancellation, the insurer is 100% correct it MUST be in written form, to be classified as valid.

 

[PrivatePilot]

Suing in small claims court is inexpensive if you represent yourself (as a credit reporting agency might against a debtee) so don't count that out.

And you might be surprised at how many collection agencies report to the credit bureau...and the amount of data each report (including the percentage of the original debt that was considered bad, in your suggestion of just continually telling them to get lost until the ask for a lower amount) ends up on your report.

It can be very damaging and a very stupid game to play in this scenario, especially when the OP appears to be a young person with what is likely many large purchases (cars, houses, etc) in their future - nothing will make you kick yourself in the *** like fighting and refusing to pay an insurance debt only to find out 10 years later that you can't get a mortgage or finance that new or used car because of a momentary fit a decade before over what appears to be an unwarranted situation.

 

[Chasem]

Suing in small claims court is inexpensive if you represent yourself (as a credit reporting agency might against a debtee) so don't count that out.

And you might be surprised at how many collection agencies report to the credit bureau...and the amount of data each report (including the percentage of the original debt that was considered bad, in your suggestion of just continually telling them to get lost until the ask for a lower amount) ends up on your report.

It can be very damaging and a very stupid game to play in this scenario, especially when the OP appears to be a young person with what is likely many large purchases (cars, houses, etc) in their future - nothing will make you kick yourself in the *** like fighting and refusing to pay an insurance debt only to find out 10 years later that you can't get a mortgage or finance that new or used car because of a momentary fit a decade before over what appears to be an unwarranted situation.

Not sure if you understand how collection agency's work or not? They don't make a report as you think they do. They don't go tattle and say "oh man this guy told us to piss of... yada yada"

Also the maximum amount of time it will stay on his credit report is 7 years with Equifax, 5 with Transunion IIRC.

 

[Joe Bass]

@mimico_polak @JoeyB the way I read the post is that he told them multiple times that they each had a ticket, and the error was that he put both tickets under his dad. I may be mistaken.

Sent from a Samsung Galaxy far, far away using Tapatalk

 

[hedo2002]

Suing in small claims court is inexpensive if you represent yourself (as a credit reporting agency might against a debtee) so don't count that out.

And you might be surprised at how many collection agencies report to the credit bureau...and the amount of data each report (including the percentage of the original debt that was considered bad, in your suggestion of just continually telling them to get lost until the ask for a lower amount) ends up on your report.

It can be very damaging and a very stupid game to play in this scenario, especially when the OP appears to be a young person with what is likely many large purchases (cars, houses, etc) in their future - nothing will make you kick yourself in the *** like fighting and refusing to pay an insurance debt only to find out 10 years later that you can't get a mortgage or finance that new or used car because of a momentary fit a decade before over what appears to be an unwarranted situation.

Most of what you have said is correct, (and VERY advisable), except the 10 year portion. Here is a chart to show how long items remain on a credit report from the two largest reporting agencies. The chart won't post here but collections remain for 6 years from first date of delinquency. For Equifax and trans union

 

[PrivatePilot]

Not sure if you understand how collection agency's work or not? They don't make a report as you think they do. They don't go tattle and say "oh man this guy told us to piss of... yada yada"

Also the maximum amount of time it will stay on his credit report is 7 years with Equifax, 5 with Transunion IIRC.

Unpaid debts can and usually do end up on your credit report, and collection agencies can and do put them there as well in some scenarios when they "buy" the debt outright from a creditor vs have it assigned on their behalf as straight collections. This is in addition to the original debtor, so you can get double screwed in some scenarios.

And bad bad debt doesn't just magically go away after 5/7 years. AFTER you pay the debt IN FULL, it goes away after 5+ years - if you never paid it it doesn't just disappear, it stays forever...including the blemish on your report which will just get worse and worse until it hits R9 and hoses up most chances of ever getting affordable or large credit.

Methinks it's not me who doesn't understand how credit reports and collection agencies work.

 

[Chasem]

Unpaid debts can and usually do end up on your credit report, and collection agencies can and do put them there as well in some scenarios when they "buy" the debt outright from a creditor vs have it assigned on their behalf as straight collections. This is in addition to the original debtor, so you can get double screwed in some scenarios.

And bad bad debt doesn't just magically go away after 5/7 years. AFTER you pay it, it goes away after 5/6 years - if you never paid it it doesn't just disappear, it stays forever...including the blemish on your report which will just get worse and worse until it hits R9 and hoses up most chances of ever getting affordable or large credit.

Methinks it's not me who doesn't understand how credit reports and collection agencies work.

:lmao:

Please provide proof of debt staying on your credit report forever. If you are retarded, and don't dispute the credit? Remember it's YOUR file. You need to be pro-active with removal of old information. I'm not going to bicker back and fourth, the people in this thread can go read up on credit reporting and administration from TransUnion and Equifax.... But let's not spread misinformation.


I could call up my agent at GroupEcho, tell them PrivatePilot owes me $10,000. You are expecting me to believe that negative debt will stay on your credit report forever until you pay it? *rolls eyes*

 

[mugwug]

And bad bad debt doesn't just magically go away after 5/7 years. AFTER you pay the debt IN FULL, it goes away after 5+ years - if you never paid it it doesn't just disappear, it stays forever...including the blemish on your report which will just get worse and worse until it hits R9 and hoses up most chances of ever getting affordable or large credit.

Methinks it's not me who doesn't understand how credit reports and collection agencies work.

Bad debt NEVER goes away, but their ability to 'legally' report it to the credit reporting agencies DOES. After 2 years (SOL) they can no longer sue you for the debt in court (assuming no further acknowledgement of the debt on your part), after 7 years the debt falls off your credit report (both transunion and equifax) and can NO LONGER be reported to Credit Reporting Agencies (and if they do 'redate' the debt you can dispute it and get it removed), now the collection agencies can sell that debt around and phone you and send you nasty letters into perpetuity but it's little more than harrassment at that point.

So no....the blemish on your credit report does NOT stay forever...but it could be a long 7 years waiting for it to go away.

 

[PrivatePilot]

Theoretical situation:

At my age, with my house nearly paid off, 3 vehicles, 1 motorcycle, and being able to pay for everything I could want or need in the next decade with cash, I should just run out and rack up 100K in debt (which I could EASILY do with my available credit), refuse to pay anything against it and just tell the creditors to "get stuffed" for 5 or 6 years...and walk away scott free with a clean credit score and clean credit report again?

Sure. Let me know how that works out for you.

(Hint: I have no idea what you're thinking if you honestly think that's the way credit works... There'd be a lot of people gaming the system for billions annually if it did...)

 

[Chasem]

Bad debt NEVER goes away, but their ability to 'legally' report it to the credit reporting agencies DOES. After 2 years (SOL) they can no longer sue you for the debt in court (assuming no further acknowledgement of the debt on your part), after 7 years the debt falls off your credit report (both transunion and equifax) and can NO LONGER be reported to Credit Reporting Agencies (and if they do 'redate' the debt you can dispute it and get it removed), now the collection agencies can sell that debt around and phone you and send you nasty letters into perpetuity but it's little more than harrassment at that point.

So no....the blemish on your credit report does NOT stay forever...but it could be a long 7 years waiting for it to go away.

Good clarification. Although I was under the impression Equifax was 6 years and Transunion 5.

 

[Chasem]

Theoretical situation:

At my age, with my house nearly paid off, 3 vehicles, 1 motorcycle, and being able to pay for everything I could want or need in the next decade with cash, I should just run out and rack up 100K in debt (which I could EASILY do with my available credit), refuse to pay anything against it and just tell the creditors to "get stuffed" for 5 or 6 years...and walk away scott free with a clean credit score and clean credit report again?

Sure. Let me know how that works out for you.

(Hint: I have no idea what you're thinking if you honestly think that's the way credit works... There'd be a lot of people gaming the system for billions annually if it did...)

I didn't say that's how it works. That's a brilliant idea, you should try it. Hopefully nothing gets repossessed? :lmao:

Seriously man, you sound like you are getting incredibly defensive. You were already proven wrong with your "bad debt stays forever" idea.

Anyways, this is not helping the OP.

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