STATE
OF CONNECTICUT
INSURANCE DEPARTMENT
Bulletin
No. CL-1
March 17, 1987
| TO:
All Companies Licensed in the State
of Connecticut to Write Property and/or
Casualty Insurance.
RE:
Automobile Property Damage Liability
Claims ----Loss Of Use. |
It has come to my
attention that unless a claimant incurs
rental expense, many insurers fail to consider
compensation for loss of use when determining
the sums payable for which an insured is
legally liable when settling an automobile
property damage claim.
The right of a third
party claimant to be compensated for loss
of use was clearly annunciated in Connecticut
in Anderson vs Gengras Motors, Inc., 141
Conn. 688 (1954). In that case, the court
held that the plaintiff may "recover
the value of (the vehicle's) use while he
is necessarily deprived of it."
A third party claimant
may recover compensation for loss of use,
regardless of whether he has incurred a
rental expense.
The practice of failing
to consider compensation for loss of use,
when adjusting third party automobile property
damage claims in which liability has become
reasonably clear, could constitute violation
of Section 38-61(6) entitled "unfair
claim settlement practices" inasmuch
as said practice does not constitute a fair
and equitable settlement of claims.
Please review the
claim procedures with your personnel to
be certain that they comply with the intent
of the law.
Peter W. Gillias
Insurance Commissioner
