Vehicle into Structure

Step-by-step checklist

Identify

• Contact the claim adjuster right away. Ask them to hold the scene and for permission to retain an expert at the client's expense. Note the call in the file.
• On every claim, ask the client whether they want an origin and cause investigator to review the scene, or confirm one is already assigned. Note their answer in the file so the decision is on record.
• Make sure no evidence is touched or moved until the expert has secured the scene
• Get the client's approval for the scene exam cost. Most run at least $1,600 with travel, the day rate, and expenses.
• Confirm a vehicle struck the structure
• Get the police report number and any citation
• Get the driver, owner, vehicle, and insurance details

Hands off until the expert arrives. Nothing at the scene gets touched, moved, repaired, or thrown out until the origin and cause investigator has secured it. Evidence that's moved early can sink the whole recovery.

Notify

• Only a policy number? Request a claim setup. Claim open? Send notice to the adverse carrier.
• Send notice and an insurance request to the driver, owner, and employer
• Call the carrier: settlements after notice won't count in a pro rata split. Ask the limits.

Investigate

• Collect the police report, photos, video, and witness contacts
• Delivery vehicle? Get the truck number, driver name, and delivery time
• Compare damages to the limits. Short? Send the limited coverage notice.

Demand

• Review payments and out-of-pocket costs
• Sort the supports into photos, estimates, invoices, and reports
• Send the full demand packet once the claim is finalized

Negotiate

• Follow up within 30 days. No response? Send the second demand.
• Watch the statute of limitations. Get a tolling agreement or refer to litigation if needed.
• Negotiate, and push for replacement cost, not just actual cash value. Denied? Review for ADR.

Settle

• Confirm the insured has no other out-of-pocket costs
• Review the release: client as subrogee, no hold harmless
• Return the release with your W-9 and mailing address
• Receive payment, issue the deductible, and close the file

How it happens

Most vehicle-into-structure losses come from a driver losing control on the roadway, usually from speeding or bad road conditions.

Common scenarios

• Reckless driving or speeding
• Losing control in bad weather or road conditions
• Accidentally hitting the gas instead of the brake
• A vehicle knocked out of park, for example by a child
• A delivery or commercial vehicle backing into or clipping a building
• A driver's medical episode
• Drunk driving
• Vandalism or an intentional act

Scenarios to handle carefully

• Drunk driving. If the driver is criminally charged and the case goes to court, your recovery may be handled through restitution, and you'll need to follow the court's restitution guidelines. That slows the file and limits your control.
• Intentional acts and vandalism. Insurance policies almost always exclude intentional acts, so calling it vandalism can kill the coverage you're trying to recover from. Describe only the facts: the driver's vehicle struck the structure.
• Hit-and-runs. When the driver leaves before anyone gets their information, send the police a suspect notification request right away. It asks them to send the report and let you know if the driver is identified, charged, or arrested.
• Stolen vehicles. Still put the vehicle owner on notice, and their insurance carrier if they have one. The owner will likely argue they aren't at fault because a thief was driving, but that's their defense to make, not yours to assume. Engage their carrier and make them argue it.
• Medical episodes. Many states treat a sudden, unforeseeable medical emergency as no negligence, which makes these hard to recover. Michigan is the exception, because fault doesn't matter there.

Responsible parties

Look beyond the driver. Every one of these may be a source of recovery:

• The driver
• The vehicle owner, if different from the driver
• The driver's employer, when the driver was working, such as rideshare drivers or delivery drivers for Amazon, FedEx, or UPS
• In Michigan, more than one vehicle's insurer when multiple vehicles were involved and fault wasn't determined. The auto insurers then have to sort out who pays.

Proving liability

A structure is stationary. It can't pull out in front of a car, so the driver who hits it is almost always responsible. Your job is to lock down who the driver was, whose vehicle it was, and who insures it.

Evidence to get

• The police report
• Photos of the damage and the scene
• Witness names and contact information

What the police report should show

If any of this is missing, request a supplement or get it from the insured or witnesses right away:

• Driver's name and driver's license information
• Vehicle owner's name and contact information, if different from the driver
• Insurance company and policy number for the vehicle
• Vehicle year, make, model, VIN, and plate
• Loss location
• A summary of what happened

Commercial and delivery vehicles: get the details at all costs

Delivery and cargo companies like FedEx often don't file a police report. That means the only record may be what the insured writes down. Ask the insured right away for:

• The vehicle or truck number on the side of the vehicle
• The driver's name
• The time of the delivery
• What was delivered

With those details, the company can identify the driver and vehicle later. Without them, the claim can stall before it starts.

Common defenses

Damages, policy limits, and coverage gaps

What to claim

Claim everything the loss caused: the structure, landscaping, fences, trees, contents, and additional living expenses. Include the insured's deductible and any out-of-pocket costs they've authorized you to pursue.

Share the numbers early

Tell the adverse carrier what the insured's deductible is and where the reserves currently stand. Early in the claim, before large payments go out, the carrier may choose to resolve the damage directly. That's a win for the insured and the client.

Don't leave money on the table

State minimum property damage limits are low, often $25,000 or less per accident, and there may be multiple claimants sharing them. When limits are split, each claimant gets a pro rata share of the limit based on their total damages. Include every last dollar of your claim so your share of the pro rata split is as large as possible.

Put everyone on notice early

Call the adverse carrier and tell them directly: any settlements they make with other claimants after being put on notice of your claim will not be accepted in a pro rata calculation. A carrier that pays other claimants first can't use up the limits and leave your client with nothing.

When damages exceed the limits

• Ask about limits early, so you know right away whether the policy can cover the loss.
• Run an asset check on the driver and the vehicle owner to see whether they have assets worth pursuing for the balance.
• Ask the responsible party whether they have any other insurance, such as an umbrella policy or a business policy that may cover the vehicle.
• Ask about uninsured and underinsured motorist coverage if anyone was injured. On the health insurance side, a claim can be opened under UM/UIM coverage when the at-fault driver's coverage isn't enough. Flag it for the health plan's subrogation team so that money isn't missed.
• Expect a pro rata settlement if multiple vehicles or claimants are sharing the limits.

Michigan

Michigan's no-fault law changes how vehicle-into-structure claims work. Handle every Michigan file differently from other states.

• The insurance follows the vehicle, not the driver. Look to the insurer of the vehicle that struck the structure.
• That insurer pays regardless of fault. Its property protection coverage pays for damage to the structure, unless another vehicle in operation caused the crash.
• If the driver isn't that insurer's insured, the burden of pursuing the driver shifts to that insurer's own subrogation department, not yours.
• Medical episodes are recoverable. Because fault doesn't matter, the medical emergency defense that blocks recovery in other states doesn't apply.
• Farm machinery is tricky. Farm equipment generally shouldn't fall under the restriction, but equipment being pulled by a vehicle can be included.
• Parked vehicles and their contents damaged in the crash are recoverable, and a denial on this point is a common misconception. MCL 500.3123(1)(a) excludes vehicles and their contents from property protection benefits "unless the vehicle is parked in a manner as not to cause unreasonable risk of the damage which occurred." A properly parked vehicle falls within that carve-out. If a carrier denies, push back and cite the statute and that exact language. (MCL 500.3123)
• Multiple vehicles, no fault determined: the claim can go to more than one vehicle's insurer, and the auto insurers resolve who is more at fault.

Working the file

A typical vehicle-into-structure file runs in this order.

1. New claim comes in. A vehicle struck the insured's property. Send the insured the opening letter.
2. Put the adverse carrier on notice. If you have the carrier and a claim number, send the notice letter. If you only have a policy number, don't send a notice letter. Ask the carrier to set up a claim first. If you don't know the insurance at all, send the insurance request to the driver and owner. For commercial vehicles, also send letters to the employer, the driver, and the vehicle owner.
3. Call the carrier. Tell them any settlements they make after being put on notice won't be accepted in a pro rata calculation. Ask early what the policy limits are.
4. Confirm they received the notice. Get it in writing or note the call.
5. Send the demand once the claim is finalized, with all supporting documents.
6. Follow up within 30 days for an update on their investigation. If there's no response, send the second demand.
7. Watch the statute of limitations. Some states have a one-year deadline, and repairs can run longer. If the file will go past the deadline, get a tolling agreement signed or refer it to litigation to preserve the claim.
8. Negotiate the settlement. Carriers usually offer actual cash value only and won't pay recoverable depreciation. Push back with the replacement cost documentation.
9. Check with the insured before signing a release. Confirm they have no additional out-of-pocket costs. If they do, they can go to the adverse carrier themselves, or sign your agreement and send their supporting documents.
10. Get and review the release. It should name the client as subrogee of the insured. The TPA doesn't need to be named. Remove any hold-harmless language before signing.
11. Send the signed release as a high priority, with your office's W-9 and the address to mail the check.
12. When payment arrives, close the file. Send the standard closing letter to the client and the deductible reimbursement letter to the insured.

Letters for this loss

For an insured's own out-of-pocket claim handled directly, see the Out-of-Pocket Recovery Letter, which uses a vehicle-into-home example.