Disputing a Fault Denial and a Collection Demand

Attorney Answer

An insurer’s decision that its own driver was not at fault is a claims position, not a legal ruling — it binds no one but the insurer. And you are entitled to see, in writing, what a collector says you owe and why, before you pay anything.

Fault in California is measured under Cal. Civ. Code § 1714(a): “Everyone is responsible, not only for the result of his or her willful acts, but also for an injury occasioned to another by his or her want of ordinary care or skill in the management of his or her property or person, except so far as the latter has, willfully or by want of ordinary care, brought the injury upon himself or herself.” An adjuster applies that standard to reach a claims decision. Only a court, or a settlement, makes that decision binding. Fault here is also not all-or-nothing: a share of blame reduces what a party recovers rather than wiping it out, which is the pure comparative system reaffirmed in Daly v. General Motors Corp., 20 Cal. 3d 725 (1978). That cuts both ways — it also limits what anyone can collect from you if you were only partly responsible.

California’s claims regulations give you real leverage here. Under Cal. Code Regs. tit. 10, § 2695.7(b), an insurer must accept or deny a claim, in whole or in part, no more than 40 calendar days after receiving proof of claim. Section 2695.7(b)(1) requires an insurer that denies a third-party claim, or that disputes liability or damages, to do so in writing. Section 2695.7(b)(3) requires that written notification to tell the claimant they may have the matter reviewed by the California Department of Insurance, and to give that unit’s address and telephone number. Section 2695.5(b) requires a response to a claimant’s communication within 15 calendar days. And under § 2695.5(a), an insurer has 21 calendar days to give the Department a complete written response about a claim — which is why a Department complaint often produces answers that phone calls do not.

The collection demand is a separate problem from the accident. Debt collectors are required by state and federal consumer law to identify who they collect for and to verify what is claimed; those requirements are worth a lawyer’s or a consumer agency’s attention. Until you have that in writing, do not pay and do not agree to a payment plan — agreeing to pay can be treated as acknowledging the debt.

What you can do

1. Send the collection agency a written request — and keep a copy — for a full itemization of what is claimed, the date and event it comes from, and the name of the company it is collecting for.

2. Ask the other driver’s insurer, in writing, for its denial in writing — Cal. Code Regs. tit. 10, § 2695.7(b)(1) requires an insurer that denies a third-party claim, or that disputes liability or damages, to do so in writing, and § 2695.7(b)(3) requires that written notice to tell you that you may have the matter reviewed by the California Department of Insurance.

3. File a complaint with the California Department of Insurance; the insurer then has 21 calendar days to give the Department a complete written response (Cal. Code Regs. tit. 10, § 2695.5(a)).

4. Report the claim to your own insurer if you have not already, even though you were not at fault — your own collision coverage may repair the car, and your carrier can pursue the other side.

5. Ask a local lawyer about the collection demand and about whether it is time to bring a claim of your own. Most lawyers offer a brief initial call at no cost, and a few minutes on your specific facts is worth more than any general guidance, including this page.

⏱ Time limits apply. A California claim for vehicle damage runs on the three-year period in Cal. Code Civ. Proc. § 338(c)(1); injury claims run on the two-year period in Cal. Code Civ. Proc. § 335.1. When each clock started, and which one governs your situation, depends on your facts. Have a local attorney check the dates against your file before you assume there is still time.