Motor Insurance: Deadline for the Insurer to Propose Compensation in the Event of Total Vehicle Loss

In this case, a policyholder whose vehicle had suffered significant damage requested compensation from their insurer. The insurer initially contested coverage, thereby delaying its obligation to offer total loss compensation.

The Court of Cassation ruled that the obligation to propose total loss compensation arises only from the recognition of coverage, whether by agreement or judicial decision. Accordingly, when the insurer denies coverage, the 15-day period provided for in Article L. 327-1 begins only from the recognition of coverage. In this case, the insurer failed to respect this deadline after coverage was acknowledged, and the Court therefore held that its inaction constituted a contractual breach.

This decision clarifies the timing of the insurer's obligation in the event of total vehicle loss. The insurer cannot indefinitely postpone its compensation offer by invoking a denial of coverage.