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Hello,
I have the following situation: My hubby and I currently live on
Long Island (NYS), and have a nice low car insurance premium. We're
planning to move to Brooklyn, however, would like to keep the car
LEGALLY insured on Long Island, since Brooklyn insurance rates are
through the roof.
We're considering two options, and would like to know if they're
legal:
My husband or I can get a lease from someone who lives in Long
Island, in addition to the lease we will have in Brooklyn. We will
spend 99% of our time in Brooklyn, and every now and then will stay at
the Long Island place. Will it be legal for us to insure the car on
Long Island, showing the lease as proof of residence?
I'm seriously concerned because I know that sometimes insurance
companies hire an investigator to track the car. And if they find
that the address on insurance is fake, they will refuse to cover the
claim. However, in our case, the address WILL NOT be fake - we will
have a legal lease for the Long Island place, just won't spend any
time there.
In such setup, when the car is legally registered at a legal
address where we will not live, will we have problems getting claims
from insurance company?
Or, option 2:
Register the car to my father (who lives on Long Island), add
ourselves as drivers to his insurance, and be done. Will this be
legal, considering that we will live in Brooklyn, but will drive the
car registered to a Long Island resident? This option might be
simpler, but we'd like the car registered in our name, to avoid any
insurance penalties for my dad if we get into any sort of trouble.
Thank you for your help,
Elana
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In article <bt7e809007fs516tih2s285a6dgqk5vbai@4ax.com>,
Elana <elanamig@yahoo.com> wrote:
My husband or I can get a lease from someone who lives in Long
Island, in addition to the lease we will have in Brooklyn. We will
spend 99% of our time in Brooklyn, and every now and then will stay at
the Long Island place. Will it be legal for us to insure the car on
Long Island, showing the lease as proof of residence?
Where will the car be principally garaged and driven?
I don't think you can get away with claiming a car that lives in
Brooklyn doesn't live there for insurance purposes.
Seth
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I have the following situation: My hubby and I currently live on
Long Island (NYS), and have a nice low car insurance premium. We're
planning to move to Brooklyn, however, would like to keep the car
LEGALLY insured on Long Island, since Brooklyn insurance rates are
through the roof.
Insurance rates depend on the place that a car is principally garaged.
If it principally garaged in no single place, the insurer needs to
know that and will underwrite accordingly.
If you make any misrepresentation to the insurer -- even by remaining
silent -- your insurer may refuse to pay claims. As to the state
minimum coverage, if the insurer has to pay, then it may claim
subrogation and sue you.
Your insurance agent (if you have one) is deemed your agent, and not
the insurer's, so any mistake the agent makes (by failing to ask you
something, for example) may be attributed to you and not the insurer.
Bottom line: declare all facts to the insurer. You can contrive to
reduce premiums by garaging the car a lower-rated location, but you
must then not change the facts by leaving it most of the time in some
other place without telling them of the change.
NEVER register the car in the name of someone else "as a favor"
because under state laws that person may be jointly and severally
liable for loss in case of accident (if policy limits are exceeded, or
the policy is voided). Your (and the owner's) assets are at risk every
time you take the car out on the road. Insurance is there to protect
you and those driving around you. So many people do what you are
proposing (the insurer always pays in a minor accident; it's the real
tragedies where they do the investigation and find out about
misrepresentation) that a lot of people drive around functionally
uninsured. Not only should you make sure your insurer knows all the
facts, but you should have good uninsured motorist cover.
I have seen too many tragedies of under- and un-insured loss. Sorry to
have to give a lecture. And yes, I know, you are tallking about one of
the most expensive areas in the world to insure a car.
BTW it happens that I was at the NYS DMV sorting out someone's social
security number discrepancy yesterday. I couldn't help noticing that
the person next to me was trying to sort out her own problem: a 90-day
suspension of her registration for failing to maintain insurance.
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<Can I lease a place on Long Island and use that for my car insurance
address, instead of using my NYC address and paying much higher rates.>
IIRC, many car insurance application forms explicitly ask for the address
where the car is "garaged".
--
Don in Upstate NY
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"Elana" <elanamig@yahoo.com> wrote in misc.legal.moderated:
My husband or I can get a lease from someone who lives in Long
Island, in addition to the lease we will have in Brooklyn. We will
spend 99% of our time in Brooklyn, and every now and then will stay at
the Long Island place. Will it be legal for us to insure the car on
Long Island, showing the lease as proof of residence?
Where is the car actually "garaged" -- where is it usually parked
while its drivers are asleep? That's the address you should give to
your insurance company.
However, in our case, the address WILL NOT be fake - we will
have a legal lease for the Long Island place, just won't spend any
time there.
That _is_ fake. You're not insuring your (fake) residence, you're
insuring your car.
If you fraudulently give an address where you don't actually live at
least most of the time, that's, well, fraud. Aside from billing you
for the difference in premiums if it should happen to find out, the
insurance company might possibly have grounds to refuse to cover a
loss.
An awful lot of people try to cheat their insurance companies by
playing these little address games. Sure, some never get found out
and save a few hundred dollars. But others _are_ found out and get
burned. Is this really a game you want to play?
--
If you e-mail me from a fake address, your fingers will drop off.
I am not a lawyer; this is not legal advice. When you read anything
legal on the net, always verify it on your own, in light of your
particular circumstances. You may also need to consult a lawyer.
Stan Brown, Oak Road Systems, Cortland County, New York, USA
http://OakRoadSystems.com
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I have the following situation: My hubby and I currently live on
Long Island (NYS), and have a nice low car insurance premium. We're
planning to move to Brooklyn, however, would like to keep the car
LEGALLY insured on Long Island, since Brooklyn insurance rates are
through the roof.
Hmm, any legal solution would probably involve not using the car in Brooklyn
:-)
The insurer doesn't really care where you have leases, or with whom. What they
care about is where the car is being used. And that's going to be Brooklyn.
And getting a lease on a living space you're not living in (unless it's for a
below-market rate) is going to wipe out the savings on your car insurance.
*****
Tim Horrigan <horrigan@aol.com>
*****
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Hello,
I have the following situation: My hubby and I currently live on
Long Island (NYS), and have a nice low car insurance premium. We're
planning to move to Brooklyn, however, would like to keep the car
LEGALLY insured on Long Island, since Brooklyn insurance rates are
through the roof.
We're considering two options, and would like to know if they're
legal:
My husband or I can get a lease from someone who lives in Long
Island, in addition to the lease we will have in Brooklyn. We will
spend 99% of our time in Brooklyn, and every now and then will stay at
the Long Island place. Will it be legal for us to insure the car on
Long Island, showing the lease as proof of residence?
Read the terms of the policy application. Usually, they ask you where
the car will be "principally garaged". That is a straight factual
question, not a legal formalism. If you will spend 99% of your time
in Brooklyn, the answer is "Brooklyn". To say anything else, IF THAT
IS THE WAY THEY PHRASE THE QUESTION, would be insurance fraud, a crime
in most states.
I'm seriously concerned because I know that sometimes insurance
companies hire an investigator to track the car. And if they find
that the address on insurance is fake, they will refuse to cover the
claim.
Right, and worse than that, you could wind up IN JAIL.
However, in our case, the address WILL NOT be fake - we will
have a legal lease for the Long Island place, just won't spend any
time there.
The ins. co. application wants to know all the facts that will help it
assess its risk. It's more risky to drive a car in Brooklyn than out
in the potato fields, right? And if you conceal that relevant fact
from the ins. co. when they set your rates, you are withholding
material information that may have led them to a different conclusion
as to the risk they were assuming, correct? That is called FRAUD. It
would be cheating the ins. co. by misleadingly under-stating their
risk.
In such setup, when the car is legally registered at a legal
address where we will not live, will we have problems getting claims
from insurance company?
You have to answer truthfully the actual questions that are put to you
on the application. That is the bottom line. No one can answer the
where-you-have-to-say-you-keep-it question for you unless we know
exactly what the ins. co. is ASKING you. But if, as I suspect, they
are asking you where the car will be principally garaged for the
duration of the policy, you have to answer THAT truthfully -- "in
Brooklyn".
Or, option 2:
Register the car to my father (who lives on Long Island), add
ourselves as drivers to his insurance, and be done. Will this be
legal, considering that we will live in Brooklyn, but will drive the
car registered to a Long Island resident?
Same answer, based on the same likely question -- they don't care who
owns it, or where the owner lives, they want to know where the car
will be kept and usually driven.
For all the ins. co. cares, the owner could live in TIMBUKTU and keep
the car at the Kennedy Airport parking lot for his visits back to the
USA. What they want to know is where the CAR is.
This option might be
simpler, but we'd like the car registered in our name, to avoid any
insurance penalties for my dad if we get into any sort of trouble.
Do both your dad and yourself a favor and avoid insurance fraud.
Answer the agent's questions truthfully. OTOH, you don't have to
volunteer any information he doesn't ask. But don't YOU think
there's something slightly fishy about setting up a whole shell-game
of real-but-unused addresses as you propose, to get a lower ins. rate?
Heck, the cost of the suburban lease alone is probably not worth
what you would save in insurance rates.
--
This posting is for discussion purposes, not professional advice.
Anything you post on this Newsgroup is public information.
I am not your lawyer, and you are not my client in any specific legal
matter.
For confidential professional advice, consult a lawyer in a private
communication.
Mike Jacobs
LAW OFFICE OF W. MICHAEL JACOBS
10440 Little Patuxent Pkwy #300
Columbia, MD 21044
(tel) 410-740-5685 (fax) 410-740-4300
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We're considering two options, and would like to know if they're
legal:
Google ate my longer response. Short answer: Don't lie, but you
may look at things in the light most favorable to you without getting
severely whacked.
If they ask "Where do you live now?" that might still be LI, even if
you intend to move to Brooklyn at some unknown future date.
If the insurance asks "Where is the car principally garaged?" that is
a specific and different question from "Where do you live?", and IMHO
in any case it's best if you always give the same answer to "Where
do you live?", whether it's for taxes, jury duty, driver's license,
firearms license, etc., and it's a justifiable answer. (Even if
it's the wrong answer, the penalties are usually less for "I thought
it was _____ because ______ which you now tell me is not sufficient"
than for "I said ______ knowing it was a lie because I thought I wouldn't
get caught."
Are the insurance rates really so high in Brooklyn now that it's cheaper
to pay a second rent on Long Island?
If you father lends you his car, his insurance might ask him where his
car is principally garaged, but if it's only a temporary loan, you might
not cross the threshold; but as always it exposes him to risk, if you
get in an accident then as owner he might be liable, and any accidents
or tickets you get could raise his insurance rates.
--
- David Chesler <chesler@post.harvard.edu>
Iacta alea est
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Tam <tamsuraiya@yahoo.ca> wrote:
Your insurance agent (if you have one) is deemed your agent, and not
the insurer's, so any mistake the agent makes (by failing to ask you
something, for example) may be attributed to you and not the insurer.
While agreeing with the rest of Tam's excellent post, I have doubts
about this paragraph. My understanding is that an insurance _agent_
is the agent of the company and has the power to bind the company.
(Also, an agent usually represents only a single company or a group of
companies that are subsidiaries of one owner).
An insurance _broker_, by contrast, might be the customer's agent for
certain purposes. A broker usually sells insurance for more than one
company. But I will note that in certain cases the broker can _still_
make a binding contract for the company. Frex, if you buy life
insurance, your broker will probably ask you some questions, then
quote you a rate and accept your check for the first year's premium.
That transaction is called a binder and forms an actual contract
between you and the insurance company. The company _may_ decide to
cancel the contract if it turns out you don't fit its underwriting
criteria (e.g., if your medical exam reveals a problem that would
require a higher premium). But if you should happen to die
before the company exercises that option, the company will have to pay
on the policy.
--
I pledge allegiance to the Constitution of the United States of America, and
to the republic which it established, one nation from many peoples, promising
liberty and justice for all.
Feel free to use the above variant pledge in your own postings.
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Tam <tamsuraiya@yahoo.ca> wrote:
Your insurance agent (if you have one) is deemed your agent, and not
the insurer's, so any mistake the agent makes (by failing to ask you
something, for example) may be attributed to you and not the insurer.
While agreeing with the rest of Tam's excellent post, I have doubts
about this paragraph. My understanding is that an insurance _agent_
is the agent of the company and has the power to bind the company....
An insurance _broker_, by contrast, might be the customer's agent for
certain purposes. A broker usually sells insurance for more than one
company. But I will note that in certain cases the broker can _still_
make a binding contract for the company.
....
I write (in a ng) for the general public and not for other lawyers or
specialists. To ask the original inquirer to distinguish between
servants (employees) of a specific company and agents/brokers deemed
to be agents of the insured could well lead to costly error. I prefer
to state the rule in the safest possible way. I have studied insurance
law in the USA and in Europe. I do not practice it (indeed, I'm
retired from practice.)
The law is variable by jurisdiction. Misrepresentations are, however,
almost always deemed the "fault" of the insurance buyer. S/he must
inform the company of all relevant facts, even if the insurance is
sold by an employee of the firm (say, GEICO or USAA) and the firm
fails to ask. I would bet that failing to tell an Allstate rep who
sells, uniquely, Allstate products would lead to the same result.
Recently at a dinner party someone complained to me that a car insured
through the AA (the UK's automobile association, formerly member-owned
but now privatized) had not been asked, and therefore did not tell,
that the car was garaged at a different address in the same city from
the billing address. When stolen, she was refused payment. (On the
other hand, USAA told my daughter that her car was covered anywhere in
the UK, including Northern Ireland, where she went to university.)
In the UK life insurance (and many others) are sold on the basis of a
"proposal" made by the buyer. A binder is, therefore (and I think this
is the same in the US although the proposal system is not) valid only
if, in retrospect, the insurance company would have issued the policy
under the facts given. Regardless of the fact that the insured died
before actually receiving the policy. (Some, perhaps most, US policies
require delivery of the policy during the insured's lifetime.)
I have known insurance companies to pay out to the beneficiaries of a
policy where the insured died before issuance. But usually that is in
the case of a clearly healthy person who died in an accident.
In France a misrepresentation in application for a non-life policy
leads to partial payment: the percentage of loss that the premium paid
bears to what premium should have been charged if the truth had been
told. In Germany a misrepresentation does not bar recovery unless it
is germane to the actual cause of loss. In England any
misrepresentation leads to zero recovery. Reviewing US cases, the
outcome seems to depend on the state. And what the jury finds as to
facts (juries do not rule on insurance cases in Europe.)
Probably I have strayed from the original query, which I have already
forgotten. "Misrepresentaiton" is the operative word, though, and how
it affects recovery depends on the jurisdiction and on lots of
imponderables.
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Tam wrote:
The law is variable by jurisdiction. Misrepresentations are, however,
almost always deemed the "fault" of the insurance buyer. S/he must
inform the company of all relevant facts
.....
Recently at a dinner party someone complained to me that a car insured
through the AA ... had not been asked, and therefore did not tell,
that the car was garaged at a different address in the same city from
the billing address. When stolen, she was refused payment.
And the buyer of the insurance is supposed to know that this was
a relevant fact, even when the agent could easily have asked it but
did not?
Unless it's ambiguous and I know I'm on a boundary case ("Does household
member include my domestic partner to whom I'm not married, who lives
with me?" or "Does household member include my lawful spouse who does not
live with me because she's away at school?") if I've got a multi-page form
full of stupid questions (like why do you need to know the gender of both
me and my spouse, or the century of the year of my birth) I don't generally
waste my time second-guessing what the form-makers lawyers and auditors
should have reviewed. (I did have a problem that never quite got resolved
when AAA's Commerce Union insurance in Massachusetts asked if I'd been
convicted of a traffic violation. I didn't volunteer a civil finding of
responsibility because they didn't ask, and didn't decide it was relevant
until after it was too late under law to get a refund, even though I'd paid
in full. I was too busy buying a house, which lowered my rate, making it
come close enough to a wash that I didn't lose insurance, so I didn't
pursue it.)
--
- David Chesler <chesler@post.harvard.edu>
Iacta alea est
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