Sauk Rapids woman wages yearlong auto insurance battle - St. Cloud Times

Adam Pflipsen stands next to the car that he was driving when it was struck by another vehicle.(Photo: Dave Schwarz, dschwarz@stcloudtimes.com)Buy Photo

Cheryl Pflipsen has learned more than she ever wanted to about the auto insurance business in the past year.

Pflipsen’s son, Adam, was working his way through college last summer in Fargo when he was involved in a collision with a vehicle that belonged to National Car Rental. The other driver, according to records, was at fault and no one was hurt.

After learning that, the Pflipsen family breathed a sigh of relief and waited for their claim to be settled. But more than a year later, negotiations dragged on and accusations mounted between the family and Rental Insurance Services, a Colorado company that handles liability claims for National, Enterprise and other major rental companies.

The Pflipsens carried only liability insurance on the vehicle their son was using, a 2000 Buick Regal with about 147,000 miles. As a result, Cheryl Pflipsen became her own representative in a process she called a ‘nightmare.’ She negotiated a settlement of $3,522 after initial offers of barely one-third that much, but also spent hundreds of hours in the process and accumulated a four-inch stack of paperwork.

“I wanted fair market value,” Cheryl Pflipsen said. “We didn’t have a choice in what happened and it wasn’t our fault. Sometimes, I guess, that doesn’t matter.”

Car totaled

The accident occurred June 27, 2014. Since their son was without a vehicle, Terry Pflipsen, Cheryl’s husband and Adam’s father, drove to Fargo and brought Adam back home so he could take another family vehicle back for work and school. By the first week of July, Cheryl initiated contact with the rental insurance company.

According to the company, an adjuster appraised the car on July 7. Cheryl Pflipsen said she didn’t learn of the visit until July 14, after many phone calls and emails. The next day, she received a settlement offer of about $1,300 on a vehicle that was totaled. On July 17, the Pflipsens paid a $1,200 towing and storage bill to have the car returned to Central Minnesota.

On July 21, RIS made a new offer of $1,400, basing it on comparable cars found on Craigslist. Cheryl Pflipsen countered that comparable prices to replace the vehicle would run between $3,500 and $5,000. She also disputed the insurance company’s claim that the car wouldn’t start and the mileage couldn’t be verified. After almost 10 days with no movement, she contacted the North Dakota Commissioner of Insurance.

That resulted in an offer of about $2,500 on Aug. 1. A liability supervisor with RIS then communicated with the North Dakota Insurance Department that, when the Pflipsens chose not to have collision coverage, they took the chance they “would be without a carrier to help mitigate their loss.” The email further said the parties “continue to argue the same issues” and that RIS would be unable to offer more than $2,882.

An investigator with the North Dakota Insurance Department responded that Cheryl Pflipsen was making “valid points” in their negotiations regarding RIS’ reluctance to pay more than $20 a day for storage, and that Adam Pflipsen had not been offered a rental vehicle.

“Some of the time we’re arguing some of the same issues, but some of the time we are just trying to get you to answer our questions,” wrote Kathy Wolf, the investigator, wrote to RIS. “I’m trying to be objective here but when you avoid the questions, it makes it hard to remain neutral or even try to explain to the claimant.”

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Damage to Adam Pflipsen's car. (Photo: Dave Schwarz, dschwarz@stcloudtimes.com)

Filing suit

In September, the Pflipsens filed suit against RIS but it was later dismissed because the case was brought in Benton County, where the Pflipsens live, and not in North Dakota, where the accident occurred. In November, the North Dakota Attorney General’s office told Cheryl Pflipsen it did not have jurisdiction or authority over her issues.

“I wish my mom would’ve kept track of the amount of hours she put in on this,” Adam Pflipsen said. “I’m amazed. It’s incredible. I’m sure the benefit works out to a couple of dollars an hour, though, so maybe it’s better that we don’t know.”

The Pflipsens’ independent insurance agent, Bob Stoltman of Rice, made inquiries on their behalf but had no leverage. He said the situation was complicated by the fact that RIS is a company operated by Enterprise Holdings Inc., and is one of several layers of companies with which he was trying to communicate.

“Insurance companies always come off looking like the bad guy, but I’ve never seen such difficulty coming to an agreement on the value of a vehicle,” Stoltman said. “I guess the moral of the story is that you can’t assume that just because you get hit by somebody else that their insurance will take care of it.”

In December, Cheryl Pflipsen appealed to Minnesota Attorney General’s Office, which sent a letter Dec. 18 to RIS requesting a review of the Pflipsens’ claim and a response within 10 days. RIS said it didn’t receive the letter until Jan. 13 and responded six days later, stating the offer of $2,882 remained open and that Minnesota’s attorney general office had no connection to their loss. On Jan. 28, RIS made its offer of $3,522.

Final offer

Despite five more months of byplay, that’s where the negotiations stalled. A further inquiry with the Minnesota Department of Commerce concluded the dispute would best have been decided by civil action in North Dakota. And, at that point, Cheryl Pflipsen decided she couldn’t afford to invest any more in trying to settle. On July 9, she accepted the offer made in January.

“This was rather uncommon,” said Lisa Martini, a spokesperson for RIS. “We handled it like we would other situations but it did drag on a lot longer. Within two weeks, there was an offer on the table. It was based on vehicles of similar age and mileage. With a 15-year-old vehicle, that’s going to vary. There was one regulatory agency involved, and then there was a lawsuit filed. That obviously is going to hold things up. Then the Department of Insurance in Minnesota got involved and they didn’t ask us to change anything. ... We work with the regulatory agencies on a regular basis and, if they say ‘You’ve come in too low’ or ‘Your comps are off,’ we change it.”

Now, Adam Pflipsen is driving a 2001 Mercury Grand Marquis that used to belong to his grandmother â€" and Cheryl Pflipsen has changed the family coverage to include collision.

“I’m not going through this again. I don’t care what the car’s worth anymore, everything has full coverage. That’s costing us more money, but I think it’s worth it,” she said.

Follow Kevin Allenspach on Twitter @KevinAllenspach. Call him at 255-8745.

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