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$2.2 million supercar case heads to court

Insurance company disputes a car owner's account of how his Bugatti Veyron ended up in the drink.

By MSN Money Partner Nov 29, 2011 7:43PM

This post comes from Des Toups at partner site on MSN MoneyA Texas jury will get its hands on one of the sexiest car insurance claims ever filed.


Philadelphia Indemnity Insurance Co. has accused a Texas man of borrowing $1 million to buy a Bugatti Veyron supercar, insuring it for twice that much, then driving it into a swamp and filing a claim. Last week, a U.S. District Court judge rejected a request for a summary judgment that would have decided the case without a trial. The judge cited "quizzical factual circumstances" that only a jury can decide.


Owner Andy House's November 2009 excursion into murky waters near Galveston, Texas, was certainly well-documented: Photos of the submerged exotic sprouted around the Web, as did a video on YouTube of the event itself, taken by another driver documenting his sighting of such a rare vehicle. (Only 300 Veyrons were built.)


What's all the fuss about? The videos below, one dating back to 2006, show Veyrons in action. The post continues below.

In its initial filing, the insurance company cites the video as proof that the circumstances of the incident weren't as House claimed -- that he had swerved to avoid a pelican:

No obvious motions to correct the course of the vehicle could be seen and it does not appear that Mr. House ever used the brakes to stop the vehicle before entering the water. Additionally, the video does not appear to confirm that a pelican was in Mr. House's immediate field of vision.

The company said it found no skid marks at the scene, and that House left the 1,001-horsepower engine running, ingesting water and ruining it.


The YouTube video has racked up 2.5 million views.


Millions at stake in car insurance claim

Obviously, owners of high-dollar supercars aren't insured the same way as drivers of Honda Accords. Under a traditional car insurance policy, no insurance company will pay you more than the fair market value of your car.


But for some cars, factors such as modifications, rarity or historical significance make fair market value hard to pin down. The solution is usually an agreed-value policy, where the owner and insurance company agree ahead of time to a payoff if the car is ever damaged. If you say your 1994 Chevy Lumina is worth $100,000, the company will agree with you -- and charge you accordingly. (See "Insuring your keepsake car.")


House, the insurance company says, stated the value of his 2006 Veyron as $2.2 million and was issued a policy based on that amount. The car insurance company alleges that House obtained an interest-free loan of $1.05 million for the car from another Texan, Lloyd Gillespie, and named Gillespie as a loss payee on the policy.


Gillespie is also a defendant in the case.


Collector-car policies typically come with some conditions. Low mileage was one of the terms Philadelphia Indemnity placed on House's policy, which limited the car's use to display, parades and exhibitions. The complaint alleges that House had driven the 2006 Bugatti more than 1,200 miles in one month of ownership (triple the previous owner's three-year mileage), including visits on the day of the accident to a Taco Cabana for breakfast and a Wingstop for lunch. Philadelphia Indemnity contends that such excessive driving violated the terms of the policy.


More on and MSN Money:

Nov 30, 2011 10:25PM
If this was an intentional ditch or not, let the jury decide.
However, the insurance company was greedy to insure something for $2M that is worth $1M. I don't think they objected when they took the premium payment. 
Nov 30, 2011 10:37PM
If the Jury is an intelligent group of individuals and based on the circumstances....I see no reason why the Insurance Company should pay a dime...they should counter sue for Insurance Fraud in my opinion. Then Mr. House can sit in jail and dwell on his Stupid Actions.
Nov 30, 2011 10:56PM
Definately stinks of a scam in mho.  I hope the defendents get counter sued and jail time.  Not only for attempting a scam that usually comes back around to hurt normal people in the form of higher rates, but also for trashing a gorgeous car in the process.  The Veyron is a rolling example of automotive art both in looks and engineering and for them to intentionally go out and trash one intentionally is just plain sad.  It might be less sad if it appeared to be a better planned scam at least, but that is just adding insult to injury so to speak.  ....  Nail 'em to the wall.
Nov 30, 2011 11:10PM
I swear .... I swerved to miss a pelican.

Yer honor I present exhibit "A" a video of the actual incident in question and confirmed by all parties to be original and unedited.

Que video --- Judge: WTH? What pelican? The one IN the water?


Dec 1, 2011 12:34AM
As Clint Eastwood would say "For doing that to an exotic car, he needs his **** cut off"
Nov 30, 2011 11:06PM
An Interest Free loan of $1.05 million.....hahahahaha
Nov 30, 2011 10:48PM
I've seen this video of the car going in to the waster several times. I often wondered what the heck happened. Now I know.
Dec 1, 2011 1:54AM
That would be a tough job as a juror. Which deceitful crook do you side with on this one? It appears that the guy is trying to hose the insurance company, but we KNOW that insurance companies are out to hose all of us....
Nov 30, 2011 11:35PM

To Tib/001:  The premium isn't set with a gun-to-the-head. The owner has the option to shop for the best deal, based on what the "agreed" value is.  There was mutual agreement on value and premium . . . just not the expectation of one party - the insurer- of the owner perpetrating a scam. We all pay for this kind of skulldugery . . . or, maybe you're among the "never believed in insurance" and don't worry about costs.  The costs that we responsible citizens cover for you. 

Dec 1, 2011 1:13AM
I guess he thought the insurance was a better investment than the stock market. I would bet he did not know he was being video taped. Many auto enthusiasts would video it as it is not something you see everyday or even every month unless you live in Beverly Hills
Dec 1, 2011 1:54AM
really????  this is what passes for news?  should anyone care how a rich guy gets even richer?  my life sucks and I drive a Charger.  I don't give a crap about the guy, the car or the insurance company.
Dec 1, 2011 1:48AM
it appears as though neither the driver or insc co are very bright. being greedy always comes back to bite you. both loose. God dont like ugly!!!!Crying 
Dec 1, 2011 1:19AM

Again, there is much more to this story.  Unfortunately for you, you are on the not knowing side.       Trust me, you should make the trip.


Again, you are only proving to me that you do not know a thing about public records.  There isn't a charge to read them.  Only if you want hard copies.  Since you are not willing (or perhaps just unable to follow directions) the insurance company, in their petition, states they have had an informant come to them who alleges that Mr. House offered him money to steal the car and burn it to make it look like a theft.   Which is why I would like to know who the informant is to see just how credible that information is.


The petition is 16 pages, so I feel that was quite ample room enough. There is no limit on how long a legal petition can be.   I don't think they would allege it, unless they already had evidence that could prove it with reasonable certainty (i.e. the note that was used to obtain the loan). 


Here is a LOCAL story about how much (from the horse's mouth) he paid for the car and where he got it from.  I'm sure how much he paid is easily proven by documentation.


lufkindailynews (dot) comnews/article_23a87967-48cc-5f0d-845c-3a4b3a213408.html

Dec 1, 2011 2:01AM

The interest free loan isn't what they are alleging to be proof of malfeasance.


The insurance company's witness is pretty damning evidence (if it is a credible one) that he tried to fraud them.    According to the complaint, the witness goes on to say that House offered him money in exchange for keeping his mouth closed during the investigation.


He paid money and promised the insurance company he wouldn't drive it  specifically for business purposes (this is shown from his actual policy in the complaint.)  Since it has taken two years to investigate this, I seriously doubt the insurance company is going to pay up.  


Considering he lied to them, he should be able to profit? I don't bloody think so.

Dec 1, 2011 12:33AM
If this guy did this on purpose, that's just a damn shame to do that to such an awesome vehicle....he should be jailed on principle for that...ha!   But either way....legitimate accident or not, it breaks my heart.

Dec 1, 2011 12:17AM
Depending where you are with the car, the mileage, and rarity of the model will determine the value of said supercar. Being it used when the owner who crashed it bought it, there is a significant drop in the resell value of the car. Despite the car having only 400 assumed miles on it and if the previous owner bought it new it is justified that he could have only paid $1.05 million for the car, if the seller just wanted to get rid of it. The car being an 07 and, from the looks of it, being one of the top end Veyrons, is definitely worth $2.2mil, so the insurance company would have not questioned the value insured for. Just like if you bought you car for $500, it was totalled and FMV for the car is $3500, the insurer will pay you $3500, regardless if you paid a lot less for it. At any rate, it was a clear indication this was flat out insurance fraud. Dude just got caught red handed. Throw his **** away for being so stupid.
Dec 1, 2011 12:45AM
He got a good deal on that Veyron.
Nov 30, 2011 11:34PM
I saw the story back when it first happened, while it may all be an attempted scam.. I would say that the road he was driving is about 8' wide (single lane only) and theres literally no shoulder. It is also possible that the reason there's no skid marks is that the gigantic tires and racing style suspension didn't skid. As for him not shutting off the engine in time to prevent the engine from ingesting water, well it was about 3' deep where he landed.. and if it was me.. I think I'd be too stunned after that to shut the engine off either. The insurance company claims the $2.2M price was double it's worth.. however that isn't quite true. Due to rarity and desirability, a clean low mileage Veyron (This one supposedly had less than 1,000 miles on it when he bought it) could be sold for as much as $2.0M if a buyer wanted one bad enough....these aren't cars yo can just decide "I want one, let's go buy one.." There are far more buyers than there are cars built.
The biggest obstacle he is going to face is whether he voided his coverage by driving the vehicle when not in a parade,exhibition or show.. as the insurance claims his coverage was limited to. As well as if the accident happened after he exceeded the maximum amount of miles allowed.
Dec 1, 2011 12:44AM

Actually Ceadderman, they do!  And I have read it. It's public record, they have to let you read it. You would know that if you knew anything about how public records and the judicial system work.


Go to the federal courthouse, or just go to msnbc dot com and they have an article with the pdf petition posted.


Dec 1, 2011 1:22AM
Why the f... would one pay a million dollars for a car?....because he could...I guess.
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