Car insurance error in my favor?
February 5, 2014 7:45 AM   Subscribe

Giant National Car Insurance Company and I disagree about whether or not I have paid my insurance bill for this half-year. They say I have. I say I haven't. Should I just give up and keep the money? Moral Quandry inside.

On December 27th of 2013, I used an online form to play Car Insurance Company in full for half a years' worth of car insurance (let's say it's $500). Soon, I received an email confirmation that the payment had gone through. I waited for the funds to disappear out of my checking account, but it did not happen.

I went to my credit union to see what was up. They said that not only had the amount not been taken out of my account, there had been no attempt from the Car Insurance Company to take any funds out of that account. I was told to call the Car Insurance Company.

I contacted Car Insurance Company via email and then via phone to see what was going on. Car Insurance Company's representative said that, when I used the online form, two of the numbers in my account were transposed. She said that the attempt to take the funds out would eventually fail, and it would be returned as a non-payment. They would put a note on my account that, when that happened, I would not be charged a $20 for a returned/late payment.

Since I had the representative on the phone, I asked if I could set up the funds transfer right then to make sure that my insurance remained active. We did so over the phone. A few days later, I saw that $500 had been transferred out of my account, to the Car Insurance Company.

Awesome. I'm paid up, life is good.

Yesterday, I logged into my online account at the Credit Union to find that I had been refunded $500 from the Car Insurance Company. I checked my Car Insurance account online, and it says that I am paid up and all is well.


1. I say that I paid my car insurance once. First time was a mistake, second time worked.
2. Car Insurance Company says I paid car insurance twice, they refunded me for one of the payments.
3. Credit union says I paid car insurance once.

I tried to contact the Car Insurance Company again to...uh, give them their money back...when I thought, "Do I have to do this?" How hard should I try to give them their money back? If they think I'm solid and the credit union thinks I'm solid and I'm the only one that knows that there's mischief afoot...can I just shut up and keep my head down? I feel like I've jumped through plenty of hoops trying to be honest. Is it time to just do a little "we're in the money" dance and buy mama some new shoes?

Complication: I have a very loud, annoying conscience. If your response is "Keep the money", could you give me some reassurance that the Insurance Company/Credit Union won't come back to bite me?
posted by anonymous to Grab Bag (18 answers total)
I would attempt to get something in writing from them (maybe this is a statement showing a paid-in-full account, an email chain documenting you trying to get this resolved, I don't know) just so you have it in case it should ever come up.

You've tried and tried to pay them. They're stupid. I think you've done your due diligence here; it's not your fault that they suck at bookkeeping. Make sure that YOU'RE protected if/when they ever do figure it out, but have my permission to drop this.

If your conscience keeps bugging you, consider donating that money (or part of it) to a charity that's meaningful to you. Or buying the next person in the grocery line's groceries. Etc.
posted by phunniemee at 7:50 AM on February 5, 2014 [2 favorites]

Unfortunately you need to keep fighting to make sure this bill gets paid. If you don't, they will eventually sort out their mistake (say, whenever the guy whose money actually paid your bill finds out and disputes the charge) and either (a) bill you for the money plus a late fee, or (b) cancel your car insurance.
posted by muddgirl at 7:52 AM on February 5, 2014 [14 favorites]

That sounds super-annoying. I'd keep on this, though, mainly because I'd be worried mostly that they might investigate the payment record on the account should you ever need to claim on the insurance, and then refuse to pay your claims. That could be VERY expensive.

Deal with them in writing on this issue from now on.
posted by grouse at 8:00 AM on February 5, 2014 [3 favorites]

I feel like I've jumped through plenty of hoops trying to be honest. Is it time to just do a little "we're in the money" dance and buy mama some new shoes?

Frankly I think this would be a shitty thing to do. Practical ramifications aside (you spend the money, a month or two down the line the insurance company realizes their mistake and bills you/cancels your policy/does something else unpleasant), do you really want to be the kind of person who takes advantage of others' mistakes in this way?

I would wait a couple of weeks (to make sure the payment issue isn't going to be sorted out via auto-debit) and then mail a check to the insurance company.
posted by schroedingersgirl at 8:00 AM on February 5, 2014

I would call the insurance company back and politely but firmly escalate this to someone who can solve it now. And by that I mean someone who has the authority to cancel the first transposed non-payment NOW and who can then take the real payment. Car insurance is a legal requirement in the US and is just a really good idea in general because even small crashes can cost a boatload of money. I see your worst case scenario as being that you get into an accident a week after the first attempted payment finally fails (which you're unaware of) and you're actually uninsured. That's illegal (in the US) and also very, very costly. Or you could just be pulled over and get cited for no insurance. That's also a problem.

I would not let this go and I definitely would not spend the money I had earmarked for this on anything other than this. Also, from what you've written, it sounds like you mistyped your account numbers in the first place? If that's the case even if there aren't any horrible repercussions (which again to be clear you shouldn't risk), it's kind of ethically on you to fix your own mistake here.
posted by vegartanipla at 8:01 AM on February 5, 2014 [4 favorites]

Also, in case this matters to your conscience, it's probably not that the insurance company is out $500, but whatever poor individual they mistakenly debited the account of.
posted by grouse at 8:02 AM on February 5, 2014 [1 favorite]

You need to get something from them in writing. They may not care that much right now, but if you get in an accident and they're facing down a multi-million dollar personal injury claim, you can bet they'll care then, and use this as a reason to declare you uninsured.
posted by jacquilynne at 8:03 AM on February 5, 2014 [8 favorites]

...when I used the online form, two of the numbers in my account were transposed

Missed this on the first read. Doubling down on my prior comment. This whole mess was caused by your typo; it is beyond unethical to consider shafting someone else at this point.
posted by schroedingersgirl at 8:05 AM on February 5, 2014

I doubt it. Eventually they will find out and come asking for the money. I set up automatic bill payments for my student loan and through no fault of my own, it never went through. I felt that from my end, it took a while for me to notice the bills weren't getting paid and even then, I was slow to act because I felt I did what I needed to do and the error was their fault. My credit got dinged pretty bad with an account showing up as delinquent just as I was car shopping. If you want to wait for them to ask again, go for it, but then you need to deal with it immediately. However, I would expect that time will come and just handle it before then.

You could submit another payment and if they send that back to you or apply to your next six months, then that's a bonus. But I don't see how they will never notice you didn't pay. Whoever they took the money from should certainly notice. If not, you've stolen money from some random person.
posted by AppleTurnover at 8:15 AM on February 5, 2014

Also, in case this matters to your conscience, it's probably not that the insurance company is out $500, but whatever poor individual they mistakenly debited the account of.

In case this matters to your conscience, succeeding in paying that $500 probably won't mean that the poor individual gets his $500 back, but that the insurance company gets an extra $500. The only way said poor individual will get his money back is if he complains to the bank himself.

Make sure the error is fixed for future payments and obtain a written confirmation that you do not owe anything on the account. Be prepared for the idea that the company will still give you trouble if they discover the error later on. But calling this behaviour unethical? Please. Oh no, a giant car insurance company, let me get the tiny violin.
posted by Behemoth at 8:26 AM on February 5, 2014 [1 favorite]

But they didn't take money from anyone else's account. They failed to take money from the OP's account (bad information was provided - not enough information to take money from the "wrong" account - that's why it failed!). Then the OP paid them. They believe (or their system believes) that the OP paid twice; therefore they refunded the OP once. The problem is that the systems don't talk to each other right - they have one system which would show that the OP only paid once, but another system which shows two payments.

Honestly, I would try to get them to take my money - no one is being harmed if they don't, but let's say that you get into a car accident and then they look carefully at your account and you weren't paid up and so you weren't technically insured....
posted by Frowner at 8:35 AM on February 5, 2014

They failed to take money from the OP's account (bad information was provided - not enough information to take money from the "wrong" account - that's why it failed!).

There's definitely enough information to take money from the wrong account—routing and account numbers. The only other information relating to the receiver in an Automated Clearing House transaction record is the receiver's name. The receiver's bank can't rely on automatic checking of the name because there might be variations.
posted by grouse at 8:50 AM on February 5, 2014

Here is how the process might have gone down.

They took money from the wrong bank account(account #1) but for the correct insurance account. (payment #1)

The fixed your bank account information (account #2).

They took your payment. (payment #2)

They saw a bad transaction, and refunded payment #1 to the corrected account #2.

My guess is that someone in the world has $500 less and hasn't noticed. Yet. If it was the right routing number but wrong account number, someone at your bank MIGHT be able to help, but that might pull the knot tighter.

Good luck!
posted by bensherman at 9:03 AM on February 5, 2014

If you were to get in a serious accident, the insurer will go through all your paperwork with a microscope and try to figure out some way to avoid paying out. This would probably be something they'd notice.
posted by miyabo at 9:24 AM on February 5, 2014 [2 favorites]

I work for a Giant National Car Insurance company. My take on this is that eventually this will catch up with you and it is in your best interest to figure this out sooner rather than later. I know this is annoying, but I'm sure you can escalate it up to someone who will solve it for you. I think that the $500 is worth it for peace of mind; you really really don't want to find out that insurance is invalid for some random reason after you have an accident.
posted by peacheater at 10:13 AM on February 5, 2014

If you know the account number that they originally tried to take the money from, please contact your Credit Union with that information. If that account is open, then that account owner would have paid your insurance. They may not have noticed yet, and if they don't notice for a few months, they may not be able to dispute. For this kind of error you're usually out of luck if you don't contact the bank within 60 days of the error appearing on statement.

If that account is invalid or closed, your credit union would have worked it as an "unposted item", either returning to the insurance company or posting it to another account. Is it possible that they posted it to another account you have with them? If they returned it, they should be able to provide a trace number that you can give to the insurance company to see how the return went back.
posted by saffry at 10:49 AM on February 5, 2014

Consider this:
* Car insurance is a legal requirement.
* Even if they don't have the billing sorted out this week or this month or this year, they will sort it out for sure if you're ever (god forbid) in an accident, and retroactively cancel your coverage. No amount of notations in your account will cover your ass when it comes down to "driver wasn't paid up, so this isn't our problem".

Sorry, but you just have to keep at it until it gets sorted out, for your own sake.

(Companies can sometimes be remarkably obtuse when they are represented by their front line agents.)
posted by RedOrGreen at 12:51 PM on February 5, 2014

Worth noting this sort of thing has happened to me and my parents more than once, and not just with insurance, with the mobile carrier, ISPs, etc.

It doesn't even really matter if they fax you a think saying paid in full. In a few months, they're going to send you to collections.

Someone will figure it out, and correct it in the system, and then it'll suddenly be filed as "Delinquent for 7 months" in their system and automatically flagged to be sent to collections by someone who will look at their screen, and have no way of knowing the due diligence wasn't done and just click OK.

Solving it from there will be a goddamn nightmare. I have never cleared this kind of thing up in less than 6 months, and it often takes multiple declarations of it being paid that i have to fax back and forth over and over.

Combine this with the fact that my mom battled an insurance company for about 5 years to get them to pay out on something when her account was fully paid up and current and the error was on the other side, makes me think that if you don't deal with this... you're only really paying for the illusion of having insurance that will stop you from getting "driving without insurance" tickets from the cops, and will leave you boned over if you ever actually need it for anything.

So yea, as much as i can be all like "FUCK THE SYSTEM" i wouldn't touch this with a ten foot pole. I mean, i'd do this to comcast or something, but not the insurance company.
posted by emptythought at 1:57 PM on February 5, 2014 [1 favorite]

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