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Handling an Auto Insurance Title Dispute

Handling an auto insurance title dispute requires a certain level of understanding of the whole process and the nature of auto titles. Car ownership is something that every kid dreams of growing up. The freedom of the open road and the ability to go wherever you want is an exciting prospect for all of us in our youth. But as we grow older, the reality of the responsibilities attached to that freedom begin to set in. Auto ownership is physically represented by a title. Sometimes we have a clean title, while in other cases there are other parties with an ownership interest listed on the title. In the latter circumstance a car accident and resulting auto insurance claim can lead to title disputes. The question of ownership can muddle up the resolution of car insurance claims. It is important to address this question as early as possible to get the situation resolved in a fair and equitable manner for all involved.

Resolving Auto Insurance Title Disputes

Issues surrounding the ownership of a vehicle in the wake of car accidents are more common than some people may suppose. There is precedent for virtually any circumstance that could come up, so with guidance it is possible to work through these things. But it is important for car insurance policy holders to know what to do if these things arise so that they can minimize conflict and confusion and get to the bottom of things faster.

Pretty much anything you buy comes with a title of one sort or another, even when dealing with green car insurance options. Cars and homes come with a written title, a bill of sale or deed to the property. Other things we buy come with a receipt indicated we paid for them or providing other evidence of ownership. Auto titles are notable in that they specify the exact nature of the ownership situation at the time of purchase. If the car is purchased outright with a cash payment, the driver is listed as the title owner. If there is a lease or financing situation, the buyer or lessee is still listed as the title owner, but the financing or leasing company also has title to the car and is usually listed as having interest in the vehicle on that title. Once it is paid off, the buyer normally is issued some sort of release from the lien and can take that to the secretary of state and get a new title listing them as the only title owner.

Ideally, this setup poses no problems for either party involved. The buyer makes payments until the vehicle is paid off and keeps up auto insurance coverage and the lien holder is happy that their interests are represented until their investment is satisfied in repayment. But sometimes when car accidents happen and claims are made on the buyer's car insurance policy, trouble comes up. This is when title disputes often rear their ugly head. If an accident occurs and the lien holder still has a financial stake in the vehicle, they have a right to have some say in the way the vehicle is repaired. Most of the time when cars are just being financed the bank or other lending institution does not really want a part in the process, preferring to let the buyer and insurance company take care of the repair.

Leasing and Auto Title Disputes

But when a car is leased, things are different. Leased vehicles in many cases require repairs according to the specifications of the company handling the lease. This is because when the leased car is returned, they are responsible for reselling it and they want to protect their investment remaining in the vehicle as well as their potential profit in reselling it or leasing it again sometime down the road.

Another important scenario with auto home insurance to bear in mind is in cases where cars are totaled. If an insurer and driver make the choice to total a vehicle rather than repairing it based on damage assessment and estimates for restoration, the driver must surrender the title and relinquish his claim to the car. At this point the insurer can go ahead and sell off parts to the vehicle, for example.

Whatever the specific case may be, there is normally no reason for an auto insurance title dispute to go on for very long. In many cases disagreements over parts to be used or shops to take a car to can be worked out to everyone's satisfaction. Keeping an open mind and a cool head in the matter helps drivers make better choices. Independent arbitration is sometimes required to settle an ongoing auto insurance title dispute, but in most cases if you have the right documentation you can work things out without having to go to such lengths.


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