does the bank who financed a vechile carry their own car insurance in case of an accident and driver missed a payment which lapsed their own insurance
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UPDATED: Dec 8, 2011
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Insurance Question from Sacramento, CA
Asked on 12/08/2011
does the bank who financed a vechile carry their own car insurance in case of an accident and driver missed a payment which lapsed their own insurance driver does not remember much of the accident. The car hit a parked car and flipped over and not sure about anything more then that.
Answer given on December 09, 2011
Normally, a lender requires that the borrower maintains the insurance on the vehicle. They would not carry it “just in case”. If the lender learns of an insurance cancellation, they will sometimes notify the borrower that they will force insurance (this mostly happens on home loans but can also happen on auto loans as well. This is where a lender will force an insurance policy on the vehicle at your expense–usually 2 to 3 times the normal cost). The lender may not have known that the insurance lapsed if they did not get notification. Best thing to do is call the lender and ask if there was any insurance on the loan. I would doubt that they had any insurance policy on the car.
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