While many collisions between vehicles involve minimal or fairly easily repaired damage, sometimes the damage to the car will be so extensive that your insurance company will declare the car totaled.
Your vehicle will be determined to be a "total loss" following a collision, single-car accident, or other damaging event either if it is unrepairable, or if the cost of repairs would exceed a certain percentage of the value of the car.
If that's the case, your insurance company will prepare a claim settlement, payable to the owner of the vehicle, that is meant to reflect the value of the car at the time of the collision.
If the value of the settlement is significantly lower than the actual value of your car, you do not have to accept the settlement.
If you can prove a discrepancy between your car's true value and the claim settlement offered by your insurance company, you may be able to receive a larger settlement more in line with your expectations.
We have a few steps to take when proving your car's value to your insurance company after a total loss:
First, Visit Kelly Blue Book.
Kelly Blue Book has long been the standard tool for valuing a vehicle, so it's a great place to get started, even before you've received a settlement offer from your claims agent. In order to find out a realistic value for your vehicle, you'll need:
- Your zip code
- Options (Hybrid, 4WD, etc)
- Condition (Fair, Good, etc)
Be sure to be totally honest about every question, to ensure your value is accurate. Using this information, Kelly will populate a Blue Book Value for your vehicle, showing a reasonable Trade-In Offer or Cash Value.
Write this number down. If your insurance offers you a settlement that matches the car's value, great!
If, however, there is a significant discrepancy, you'll want to have this information on hand to help you during the next step.
Ask What They Require for Proof
Our first advice is not to react with hostility to the settlement offer, even if it is far lower than your expectations. The claims agent on the other end of the phone is, after all, simply working in accordance with their job responsibilities and will be more likely to work with you if you are calm, pleasant, and polite.
Thank them for letting you know their idea of the valuation of the vehicle, but that you disagree based on the information you gathered from Kelly Blue Book.
Sometimes, this information will be all the claims agent needs to know. If they cannot accept the Kelly Blue Book value, they may ask for further proof.
Ask what documentation, and how much, they require to accept the higher value for the vehicle in order to pay your claim. Your insurance company may ask you to provide "comps" — that is, examples of vehicles for sale or lease at your suggested value that are an identical year, make, model, condition, and sometimes color. If your claims agent asks for this information, ask them two questions:
- How many comparative examples do they require? Is it five, ten, fifteen?
- What is the range of distance they'll accept for comps? This might be within 75 miles, within the state, or some other distance measurement.
If at all possible, ask the claims agent to send these requirements to you in writing via a letter, email, or fax.
We cannot emphasize enough how important it is to maintain documentation of every single term agreed upon between the two parties. Even if they will not email you, write down everything they say so you can reference it later, along with the date and time of the communication.
Put Together Your Proof of Value
If the car dealership you bought the vehicle from is able to provide paper documentation of the value that matches your expectation, provide that to your claims agent.
You'll also want to search for cars like yours within the distance area provided by the insurance agent. Try to find enough comps to match. Don't give up if some comps are rejected. Keep searching!
Your claims agent may agree to your amount once you have provided the amount of documentation proving value that they asked for. If not...
Consider Seeking Legal Representation
We understand the hesitation many have when it comes to pursuing litigation against their insurance company — many individuals expect retaliatory behavior in return or worry that the company will drag out the time and cost. In many cases, issues like this can be settled through mediation between parties or with a settlement long before any time in the courtroom is required.
Put together your documentation of everything you've done so far, and all communications with your claims agent, and bring it to your consultation.
At Bluestein Attorneys, we've worked with individuals following automobile accidents, wrecks involving tractor trailers, and have experience with insurance companies acting in bad faith. Request your FREE consultation and we'll work with you to look over your situation and help you decide on the best option for you moving forward. Reach us by phone at (803) 779-7599 or contact us online at any time.