Court orders insurer to pay up

A district court has ordered an insurance company to pay two auto accident claims that it rejected because both drivers were driving on expired licenses, Jing'an District People's Court said Monday.

The two customers, whom the court called Liu Qin and Gu Yu, bought auto insurance from the unnamed company in January and May 2012, respectively, according to a court press release. The insurance was valid for one year.

On January 14, Liu lent her car to a friend surnamed Lin, who got into an accident with two other cars. Police determined that Lin was at fault for the accident, the court said.

The insurance company determined that the accident caused 52,000 yuan ($8,590) in auto repair bills.

On December 5, Gu got into an accident that left him with 26,855 yuan in repair bills.

Liu and Gu filed claims with the insurance company, which refused to pay the claims because each driver's license was expired at the time of the accidents.

However, it was not clearly stated in the insurance contract that the company could refuse to pay a claim just because the driver's license was expired, said Li Hongguang, a court press officer.

The two drivers later renewed their licenses.

The court ordered the insurance company to pay Liu's claim of 62,650 yuan to cover both the repair bills and medical expenses. It ordered the company to only pay Gu 22,955 yuan, because some of the repairs in his claim were not caused by the accident.

Traffic regulations state that a new driver's license is valid for six years. The regulations prohibit drivers from driving with an expired license.

It is unclear whether Gu and Lin were punished for driving without a valid license.