Auto Insurance Claims: Claim Issue, state insurance commissioners, insurance companys

Question
My 1997 Ford Escort was parked about 2 weeks ago, when it was hit & totaled by a drunk driver.  
I still owe on the car.  The drunk's insurance company has offered me a check $300 shy of what I owe on the car & on top of that, they will only make the check out to my lender.  Is this right? Shouldn't I personally be entitled to something? I have no car now, and still owe on the one that was totaled due to someone else's negligence! :(

Answer
Hi Melissa,

Insurance companys will often offer as much as 25% below the actual value on a totalled vehicle. It is up to you to prove that your vehicle is worth more. Also, when a car is totalled and there is a lender involved, the insurance company is required by law to protect the interestes of the lender by including their name on the check. That way you can not cash the check and go to the Bahamas on vacation without paying the lender.

You should demand that the insurance company provide you with a copy of what ever they used to determine the value of your car. You can then check it for errors. You should also check out the following websites to determine the retail value of your car:

1) www.nada.com
2) www.kbb.com
3) www.edmunds.com
4) www.edmunds.com

The last one will let you search for currently for sale vehicles like yours in your area. You should print out all of the information you find, average the values and then be prepared to negotiate with the insurance company. If you still do not feel they are treating you fairly, you can file a complaint with your state insurance commissioners office.

I hope this helps
Richard Hixenbaugh