QuestionQUESTION: Hi, I do not agree with the car value made by the at-fault car insurance but do not know whether it is permitted or not. The insurance picked up 20 cars from the closer mileages to high (even 7000 mileages higher than the totaled vehicle). The average price consequently becomes low. Can the insurance pick up the higher mileages car to calculate the average car value or they should pick up the closer mileages car? Does it make sense?
ANSWER: Hi Ray,
I first answered your question about 4 hours ago, but when I tried to upload my answer to the allexperts computer site, the entire answer was lost. I will attempt to re-create my answer and send it.
You are entitled to be paid the fair market value of your car based on make, year model, equipment, mileage and condition. If the adverse insurance is using an example with higher mileage, they must adjust it's price based on the mileage.
This list of 20 cars that they are using to establish a 'fair market value' is not 20 cars that they have viewed, but a list that they have purchased from a private company. No one from the insurance has seen any of the vehicles and have no idea of their looks and condition except from the minimal information contained on the report that they have purchased.
This independent company simply contacted auto dealers by telephone (usually within a 50 mile radius), described your car and ask the dealer for all the information about a similar car that he had in stock and what would be his LOWEST 'willing to sell for' price. The second part of their question was "if you don't have a similar car, what would be your lowest willing to sell for price IF you had such a vehicle on your lot."
Demand a copy of the list from the insurance company and go and look at some of the cars. The odds are that over half the cars don't exist, they are merely statements of what the dealer would charge as his lowest price if he had such a car.
You need to type a description of your car, it's accessories, condition and mileage plus and recent major improvements you might have made such as new tires or a rebuilt transmission. This should cover no more than 1/3 of a page.
Make 5 copies of this document and then start visiting dealers in your home town and surrounding areas. If you find a car similar to yours, have the dealer write it's exact description and his lowest 'willing to sell for' price on the lower 2/3 of your document along with his name and the name of the dealership and date. If he doesn't have a car like yours, have him write a statement on the lower 2/3 of your document stating what his lowest price would be if he had such a car in stock, along with signature, dealer name and date.
Once you have secured 5 dealer statements, total them and divide to secure an average. If this amount is greater than the adverse insurance company is offering, you now have documentation to dispute their offer and negotiate for a higher offer based on your new list.
I hope this information has been of help.
Your feedback by rating my answer will be appreciated.
Sincerely,
Bennie
San Francisco Bay Area
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QUESTION: Thank you for your answer. You said, “You are entitled to be paid the fair market value of your car based on make, year model, equipment, mileage and condition. If the adverse insurance is using an example with higher mileage, they must adjust it's price based on the mileage.” Then you suggested me get a quota from the car dealers.
1) Why should the adverse insurance accept the quote I got from the dealer instead of the value of the vehicle they made from their database? Is it required by the insurance law?
2) The adverse insurance did make an adjustment of $255. They state “A mileage adjustment of 2.00 cents per mile/kilometer has been applied. This adjustment is based on the vehicle year, vehicle category and market area. Mileage adjustments are capped at 40% of the vehicle’s starting value.” Can you explain how the insurance adjusts its (average) price based on the mileage by an example? Do you know why they do not list the vehicle with the low mileage (but high mileages only) and then adjust the average price? Is it a rule or their tactics? Apparently, picking up the low mileages vehicles will increase the average price.
ANSWER: Hi Ray,
The settling of any insurance claim, be it for a total loss to your vehicle or a claim for personal injury is an adverserial process.
It is the intent and desire of the insurance company, and part of the job of the claims adjuster, to pay you the least amount possible to settle the claim.
They know and use every tactic possible to keep this amount low.
The first offer made to you is always the lowest amount possible, based on the information that they have received from the 3rd party that gathered the database.
The database is flawed from the beginning because no one has inspected any of the cars on the list to see if they actually compare to yours.
In order to secure a final payment that is greater than their first offer, you must establish your own database showing a greater value than the one established by the insurance company and then start a dialogue with the adjuster for a compromise amount which will eventually be somewhere higher than their first offer and lower than the amounts of your database.
The insurance company is simply using the vehicles on the list provided by the 3rd party. If one of them had lower mileage than yours, that would increase it's value.
There are no absolutes. You are dealing with 'opinions' collected by the 3rd party and 'opinions' on any list that you gather.
If there is a sufficient 'gap' between these 'opinions', then you have sufficient reason to make a counter offer of settlement and negotiate with the adjuster for a better settlement.
Good Luck,
Bennie
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QUESTION: Ok, you said, “You are dealing with 'opinions' collected by the 3rd party and 'opinions' on any list that you gather.” If I located the same car in a dealer parking lot but the quote is higher than the value of the vehicle the insurance made, should the insurance pay the difference or I should pay the difference? If the insurance does not want to pay the difference, should the insurance provide me with the same replacement vehicle without paying anything or be obligated to locate the replacement vehicle at the price they made?
AnswerHi Ray,
In your first question, you stated that you were not happy with the amount that you were being offered to settle your total loss.
This means that you think that their offer is to low. The burden of proof that the car is worth more falls on you.
In order to get them to increase their offer, you need to get 4 - 5 dealer quotes that are larger than their offer.
This will provide you with adequate proof that their offer is too low and allow you to start negotiating for a higher settlement.
They are not going to be willing to pay you the highest prices that you have been quoted by dealers, but should be willing to negotiate a new settlement amount somewhere between their low offer and your higher dealer quotes.
The adverse insurance company is not going to look for a car for you and they would never purchase a car to give you as a replacement because this would leave them liable for any mechanical problems that you might have with the used car.
The objective is to get a higher settlement offer.
As an example, if you are being offered $6,000 and you are able to get 5 dealer quotes in the $8,000 range, then you should be able to negotiate with the insurance company and get them to increase their offer to somewhere in the $7,000 range.
I hope you are now prepared to negotiate with the insurance company.
Bennie
