CEDAR HILLS, Utah County — You might assume once a car insurance company totals your ride, cuts you a check and hauls the car away that your policy is done. Finished. End of the road.
But Brent Harper said that is not what happened to him.
Harper’s grandson wrecked his 2020 Honda Civic. The insurance company declared the car a total loss and paid Harper for it. But the monthly withdrawals for the insurance premiums kept coming out of his bank account.
“Why would they continue to charge me insurance payments on a car they know is totaled?” Harper asked.
Those automatic withdrawals continued for more than a year, totaling more than $3,100. Harper admitted he didn’t catch it right away.
“I know it’s my fault for not checking my bank account every month,” he said.
Still, he said he assumed the car insurance policy would automatically end once the car it covered was declared a total loss.
“I thought it was all done,” Harper said.
But when his insurance company, Allstate, told Harper it would be keeping those paid premiums to cover a car that no longer exists, he decided it was time to call me.
“I was taken advantage of,” he said.
Brian Harper tells KSL’s Matt Gephardt that he’s paid over $3,000 on insurance for a car he hasn’t owned in over a year. (Mark Wetzel, KSL)
So, the KSL Investigators reached out to Allstate on his behalf. The company would not answer questions about Harper’s situation, citing customer privacy.
What it would say is that totaling a car does not automatically cancel your insurance policy.
“Many customers choose to keep their policy active while shopping for a replacement,” an Allstate spokesperson wrote. “If they notify us of a new vehicle, coverage and billing continue until they end the policy.”
Digging deeper, we confirmed there are legitimate reasons a policy doesn’t end automatically after a car is totaled. Drivers may want to avoid a coverage lapse or to keep continuous-insurance discounts. They may also need an active policy to cover a rental car after a crash.
Harper said those aren’t things he wanted or needed. He hopes others learn from what happened to him.
“If it would help some other insured people from this happening to them,” he said, “that would be a double plus for me.”
So, if your car gets totaled, don’t assume the car insurance company automatically shuts the policy down even if it does cut you a check. The onus is on you to cancel coverage directly.
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.