Hudson Valley Federal Credit Union - Nine months of negotiations and unresolved car insurance issues after fatal accident.

Collateral Protection and Gap Insurance - Complaint
Review by tinahaze22 on 2013-09-19
Rating: StarEmpty StarEmpty StarEmpty StarEmpty Star
NEWBURGH, NEW YORK -- My son died in a car accident on December 21, 2012; his insurance carrier claimed he did not have comprehensive collision insurance because photos of the vehicle had not been submitted by my son.They paid a death benefit only. Gap insurance was purchased when the vehicle was purchased in June 2012. Also, when Geico dropped comprehensive collision insurance, the bank in question, Hudson Valley Federal Credit Union, who financed the car, added Collateral Protection Insurance (CPI) to the amount of the loan. After my son's death in December, I went to the bank in January 2013 to explain that my son died in a car wreck, totaling the car, and I needed to know what to do next. Initially, I was told there was no gap insurance and there was no recourse for me except to pay the car note. I sat down with representatives more than once, and in March, I sat down with a representative who said there WAS gap insurance. She contacted Geico to confirm that they would not make any payments other than the death benefit. I was not told that the CPI might cover any remaining costs. I was told at that time that a claim had been made for the gap insurance, that it would "take some time" and that, in the meanwhile, I should continue making payments, which I did. In June or July, I received a bill from the towing company, and they also asked permission to dispose of the vehicle. The vehicle was disposed of in either June or July.

In the meanwhile, I was asked to provide the title or risk default (I did not have it and had to obtain it from the DMV) and then, in August, I was asked to provide "proof of insurance" on the vehicle. I called the number provided. I was told that I should have made a claim with CPI to cover the costs to settle the matter. When I called about the CPI, I was told there was nothing that could be done at this point because the car had been disposed of. In September, I sat down with an individual at the Newburgh branch to discuss the matter and to find out if there was any progress with the gap insurance. She informed me that no claim was made in March, although it was on record that I had been in discussions with the bank. She made phone calls to CPI and State National (gap insurance) was told also that, although a claim could be made, it probably would not go through because the car had been disposed of.

The car sat in a lot in my town in plain view for 6 or 7 months, while I was in contact with the bank. I was led to believe a claim was made for the gap insurance in March, and I was never told by a representative at the bank about the CPI being an avenue I could pursue. I am still making payments, and may have to pay 13,000 for a car that has been demolished.
Comments:3 Replies - Latest reply on 2013-09-20
Posted by T on 2013-09-19:
This is a very unfortunate situation. In my opinion, Geico shares some of the blame here. I always get comprehensive insurance with SF, and after several used vehicles I have never been asked for a photo. I had Geico back in 1978 and tossed them over the side. Good luck to you - it sounds like you will need it.
Posted by jonthethird on 2013-09-19:
Insurance companies handle used car insurance different ways. I had one ask me to drive over and let them look at the car, another wanted some photos. But insurance companies do not make money paying claims: they will fight to the end if they think they can avoid it.
Posted by Johanna on 2013-09-20:
Why are you making payment's on your late son's car? Unless you were a co-signer to the loan, I would just let the bank take it over and deal with it.

At this point I think you had better get a lawyer to look into this matter and take them to court if necessary. This is too much for one person to handle.

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