Recently, a California Court of Appeal reviewed a lower court’s decision in favor of an automobile insurance company regarding coverage for vehicle damage resulting from a collision. The facts of this case are particular in that the vehicle at issue was parked at the time of the accident. The appellate court reviewed the car owner’s allegations against his insurance company, ultimately finding that a general allegation that the car had not been restored to its pre-accident condition did not suffice to hold the insurer liable for breach of contract and bad faith.
William Baldwin owned a nearly new Toyota Tundra Pickup that was struck, while parked, when two vehicles collided nearby. Mr. Baldwin had car insurance that covered collision-related damage. His insurer refused to consider the pickup a “total loss” and instead chose to repair it at a cost of $8,196.06. The future resale value of the pickup decreased by more than $17,100.
Mr. Baldwin brought a negligence claim against the drivers involved in the motor vehicle collision, as well as a claim against his insurance company for breach of contract and bad faith. According to Mr. Baldwin, under his insurance policy, the company was required to pay for the pre-accident value of the pickup or repair it to its original condition. During the repair of his vehicle, Mr. Baldwin’s insurer provided him with a rental car. In his lawsuit, he sought the difference in value for the period that his vehicle was being repaired.