Jim Deason, owner of Recovery First Insurance in Tulsa, Okla., insures repo agents nationwide.
"If something goes wrong during the course of a repossession everyone gets sued," Deason
"The concern is if the agent you have contracted doesn't have the proper insurance, it could blow up your insurance.
The last thing a dealer wants is to have his
insurance carrier having to cover a judgment."
said all dealers should require a copy of the repo agent's insurance coverage and bond.
said dealers must require that the repo agent have: an accord certificate of insurance: general liability for lawful repossessions: tow truck coverage including both hired and non-owner; and both garage keeper's direct primary and on-hook direct primary coverage.
"All these are the only types of policies we provide members of such associations as ARA, NFA and TFA
said there are other issues dealers must be concerned about, such as whether the repo agent is covered if he
physically must drive the repossessed vehicle.
said there are instances that have occurred where the dealer was liable for an at-fault accident because the repo agent wasn't insured when driving the vehicles.
"Repo agents often go get a vehicle at 3 a.m. or 4 a.m.," Deason
has seen numerous cases, which had settlements in the millions of dollars for repos done improperly where there was serious injury to the vehicle's owner.
"Even if you are right and win a case," Deason
said, "a jury trial can cost you $100,000 or $200,000.