Insurance Renewal Time Again

[zzford]

I have often wondered about settling a "Total" loss claim.  

Let's say the value (either stated or agreed) of the vehicle is $15,000.

If the damage is $15,000 or greater, the vehicle is declared a "Total" by the insurance company.  .....The insurance company writes a check for $15K, and wants your damaged vehicle.

Can the insurance company declare a vehicle "Totaled" if the damages are LESS than the value (either agreed or depreciated) of the vehicle?

I believe in the past, it has been stated (by Enjenjo?) that the insurance company does NOT have the right to take the damaged vehicle.   ......If this is true, how does one challenge the insurance company?

In the above example, if the insurance company declares the vehicle a Total loss, and is willing write a check for $15K while expecting the damaged vehicle to be turned over to them, can I tell them to write the check for $14,999, and I keep the car, since it is now not a Total loss?

Bruce, Unless collector car insurance is different, most insurance adjusters figure the vehicle to be a total loss if the damage exceeds 85% of the value of the car. Now, this may have changed, but in the past, that is how they handled it.

[enjenjo]

This also depends on the state, and the laws there. In Ohio, the car does not become the property of the insurance company until you sign it over. They can not take your property without your consent. Of course, they will not settle with you until you sign it over, or reach some other agreement. And they can not deduct more than salvage value, seldom more than $1000, from the settlement for you to keep the car. Last time I went through this, salvage value was $250 on a 5 year old luxury car.

[Uncle Bob]

Just to expand on that, it's not necessarily a fixed percentage such as the 85% mentioned though some companies may use that number as a trigger pointfor further evaluation.  The point at which a car is deemed a total loss is when the cost of repair PLUS the salvage value equals the anticipated market value of the car (or agreed value in the case of the kind of policies we've been discussing).  An owner can keep from "losing" his car by "buying it back" from the insurance company for the salvage value which supposedly is based on competitive bids from salvage operators.  The insurance company is interested in limiting it's exposure to the dollar limits stated in the policy.  I suspect that in the case of common commuter vehicles the insurance folks work from database averages rather than putting out each vehicle for bid.  In the case of collector cars it's likely to almost always be based on an actual bid. These are my experiences from being in the collision repair business, if we have any insurance employed people who know differently it would be interesting to hear from them.

I've had a few customers in the past challenge an insurance company on a valuation of a vehicles market worth.  Some won, most lost.  Usually this takes considerable research and documentation on their part since the insurance folks feel (and often justifiably) that they have more and better info on value since they do that type of work every day and have huge data bases to fall back on.  However, they aren't as infallible as they may wish to believe, and the "little guy" can win if they are willing to work hard enough.  The vast majority of people aren't willing to take on the insurance guys, which is what the insurance industry counts on.

[enjenjo]

What Uncle Bob said too. Another thing that enters in on newer cars, if the air bags have deployed, it will in most cases be totaled regardless of repair costs. The insurance companies don't want to take on the liability of having the bags fail the next time it is hit. A freind just went through this, they hit a deer, bag deployed, and the car was totaled even though it was repairable.

[Uncle Bob]

Interesting comment about the air bags Frank.  I've been away from the business a few years so didn't have that experience.  We would have a few cars total each year that were otherwise repairable, but the economics for airbag replacement on top of the rest of the repair pushed it over the valuation.  As more and more dual airbag cars became prevalent, especially on the bottom market commuter cars that didn't hold much value, the more incidence of that occured.  I suspect with curtain bags added on it gets even worse.

I wonder about the decision you mentioned being exposure rather than dollar based though, or perhaps it depends on the catagory of car.  We fixed a lot of discharged airbag systems, a typical cost 5 years ago exceeded $2000.  I made the business decision to sublet to a certified airbag repair company rather than assuming full liability for my business.  It was really just a hedge as any attorney will sue anyone who ever touched the car if there were any subsequent accident regardless of actual fault.  My rationale was that my garage keepers policy holder would probably work a split with the sublet repair companys policy holder thus lowering my potential claim incidence/cost.  Fortunately I never found out if my strategy was necessary.

[kb426]

Phat rat, I went to see the agent this morning. You are correct. Thanks for pointing that out. It's far better to know than get a surprise when you least need it.

[38HAULR]

Here in Oz.  The run of the mill insurers will not touch modified vehicles.Go to them,and they react like Dracula who has a crucifix poked into his face. We have specialist insurers fortunately who cater for this niche market of rodders and vehicle enthusiasts,with rates better than what the main companies offer to normal daily family stockers, with such benefits as glass replacement and wreck retention by the owner in event of write off also. Multiple vehicles covered under the same policy at a discounted rate,as well as the main vehicle premium  being for daily use or slightly less for occasional use...........Frank.

[Charlie Chops 1940]

A little different side of this is that while the daily driver insurance company don't offer agreed value insurance, they also on't have any problem at all continuing to raise your annual rates on the daily driver that starts to depreciate the day you drive it home.

Say you insure the new $40K pickup at $1000 a year the first year and while the insurance company risk goes down considerably every year, your rate continue to climb every year. By the time the truck is 5 or 6 years old your rate has went up 50% and the trucks value has decreased 90%. Insurance companies will never go broke. They have a legal monopoly and the biggest slew of lobbyists of probably any business category. Granted you need insurance, but the daily driver program is a scam.

My $0.02 worth.

Charlie

[38HAULR]

One scam the normal every day insurers run is to victims.   My son ,a mechanic had two vehicles one,  an 88 Jag Sovereign , the other an early 80,s Commodore [local GM compact] which he used as a work commuting vehicle ,as it was running on LPG[PROPANE].  This particular vehicle had a replacement purchase price of anywhere between $200 and $1500AUD. This second vehicle had what we call third party property damage cover, this policy only covers you for any damage you do  to property or vehicles if at fault. Your loss is not covered. for a  $100 year premium this type of policy is ideal for a low value vehicle.   and is ideal should you run into something and face huge bills.   This vehicle was parked outside his work,and was slammed by a vehicle that had collided with a third vehicle. He was entitled to claim from the insurer of the car that hit him. Got a repair quote from a local shop ,the vehicle was repairable, quote $2300.   The insurance company liable stated that the cost to repair "exceeded market value' and was a technical write off and offered him $900,later on protest, they gave him $1200 . Where this is a scam,and these people get away with it is. As far as I am concerned the vehicle was repairable at a cost,this was not my son,s fault,as a result of their client my son suffered financial outlay of $2300, and that should have been the payout. To actually repair the vehicle. The insurers get off scott free here,they give you a payment that is supposed for you to replace the vehicle with one in the exact condition as your original and walk away,he did retain the damaged vehicle and keep driving it,unfortunately the vehicle in damaged condition attracts cops on nearly every outing,even though in this case the rear lights were all working after we straightened these areas out to fit relacements........Frank

[river1]

A few years ago I got sideswiped in my mini-van.  

i don't know, i just can't picture you in a mini van  

later jim

[HotRodLadyCrusr]

A few years ago I got sideswiped in my mini-van.  

i don't know, i just can't picture you in a mini van  

later jim

Yeah, I couldn't either, thats why there was a little red Corvette parked next to it in the garage and I only drove the mini-van for work purposes OR when a bunch of us girls wanted to all ride together somewhere together.

[Leon]

Or for letting out of towners cruise Woodward    

It got real funny when they wanted me to light up the tires!

[phat rat]

I was cleaning out my file and in my insurance file were the papers for the original policy for the cpe. When I took out the insurance with Grundy in Jan. 06 the yearly premium for $40,000 was $281.34 I just renewed for $42,000 and the premium was $288.63. An increase in coverage of $2000 for $7.29. When do you see your daily increase only $7.29 in a 2 year span? Plus you certainly don't see an automatic rise in coverage.

[kb426]

Phat rat, what is your coverage and is there driving limits?

[phat rat]

Phat rat, what is your coverage and is there driving limits?

Not sure what you're refering to as coverage. Loss is $42,000. As far as limitations they say for pleasure not everyday. I've driven it all over the country, Ca., Fl. and east to Prince Edward Island. I was up front with them about the mileage when I went to them as I had already made one trip to Ca.