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What coverages do I have to buy?
What does "full coverage" mean?
What happens after I file a claim?
Why do I have to pay my deductible when the other party is at fault?
Why did my adjuster deduct for betterment?
What is comparative negligence?
Why is my vehicle a total loss?
How will the insurance company settle my total loss?
Why is my vehicle a total loss?
Your adjuster will settle your claim as a total loss when the initial estimate for repairs equals 70 percent to 80 percent of the retail value listed in NADA Official Used Car Guide or Kelley Blue Book. This is because insurance companies are not required to pay more than the fair market value of the vehicle.
The total loss threshold is less than the retail value for two reasons:
(1) Insurance companies look at the full cost of the repairs. This includes the initial estimate, supplements to the estimate, and rental car expenses. Your adjuster is supposed to anticipate these costs and make sure they do not exceed the value of your vehicle.
(2) The insurance company can reduce the cost of your claim by settling as a total loss. After you receive your payment, the salvage will be sold to a dismantler. This does not mean the insurance company is doing something inappropriate. Your compensation will be the fair market value of your vehicle. With the title in hand, the insurance company has the right to sell the salvage.
© 2008 By Higgins Body & Paint, Inc. All rights reserved.
