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Quick Summary
The Accident
What is a Total Loss?
The Initial Proposal and what your Claims Adjuster will provide you
How to Settle a Total Loss Claim Fairly with an Insurance Company

While researching this on the web, I learned quite a bit. However, it was not easy to find information that was free and comprehensive. Hopefully you will have better luck in getting prepared and hopefully that will start here.

I don’t claim to be an expert, but I can tell you what happened in our case and hopefully you can glean from that what actions will be right for you. I just have a few words of caution first. Please don’t expect this to be an opportunity for a windfall because you will be disappointed. Also, at every turn try to be fair and honest, even the smallest insurance company has been through this process more times than you can count; so if you think you can commit fraud or something… then you’re on your own! (and actually I hope they catch you at it!)

Whew! Glad I got that out of the way!

So you may not get a windfall, but that doesn’t mean you can’t get MORE then what the insurance company offers, because you can and for legitimate reasons. Because, unfortunately, insurance companies are not in the business of taking care of you; they are in business to make money and the less they pay you the more they keep for their bottom line.

So, let’s hit some quick points first, this way if you are like me you can get a quick fix of what is in store. Then I’ll give you more detail and tell you our story and include other helpful information:

  • Some of this might sound discouraging, just remember I am just trying to get you the facts. In the end you might find it easier than I’ve made it out to be. Remember, all of this will be explained in detail farther along.
  • The issue of finding a value for your automobile is SEPARATE from handling a medical claim, so don’t broach those issues in the same conversations/correspondence with the Insurance Company. If I mention anything about medical claims throughout this it will at most be in passing.
  • Unless this turns into a case of "Bad Faith", state law usually relegates these claims to small claims court or an arbitrator. So you may be better off at least attempting to get through this process yourself. (However, I absolutely recommend getting legal representation for your medical claims)
  • The longer this process takes, the better it is for you. The longer the insurance company has to wait to settle the more time and money they have to spend. Consequently the more willing they will be to hear your side of it.
  • You will have to weigh that against how long you can wait to get money to help you buy a new car, and of course the insurance company knows this. So don’t wait for them to answer you, call them and get a status. I know that is a bit contradictory but you will have to balance those competing concerns.
  • In general State regulations are fairly similar, so much of this applies to any state. However, there are some differences and I’ll show you ways to easily determine those differences later on.
  • In my opinion, regardless of who was at fault for the accident, I would choose to have your own insurance company process your claim. I believe it offers you an extra level of protection and an added level of customer service in your dealings with an adjuster.
  • Read your policy, there are things in your policy that govern you rights. An example would be the right of arbitration which I will explain later.
  • 3 Tries seems to be the charmed number. All the advice I’ve received seems to agree that rounds of negotiation seem to be a good rule of thumb. For example; 1 - They’ll make a proposal and you counter it. They’ll make a second offer and you may choose to counter it once more, but on their 3rd offer you’ve probably reached the limit of their ability to accommodate you. I should be able to help you understand why this is later on.
  • Team up! Thank god for my wife! (There’s an understatement) We shared the load, for instance she reviewed the Policy and I reviewed the state laws. The list goes on, but you get the idea.
  • Be Nice! Trust me when I say I know how hard this is, especially when it comes to things like this. I loathe having to argue about something that I’ve been paying for years! (see, don’t get me started!). However, you can also trust me when I say that the people on the other end are doing their jobs and paying their bills just like you are. So don’t make it personal, take a deep breath if you are getting angry and don’t hesitate to take a break and call back later if you need to.
The Accident
We've been involved in several accidents in our lifetimes, In my wife's case never one that's been her fault. In my case only one that was my fault when I rear ended someone in the rain but that didn't turn out to be anything major. The picture here is of out 1979 Toyota Corolla which was in "like new" condition. It had an engine in it that only had 30,000 miles on it, mechanically it was great and the interior and exterior was nearly perfect. So when the insurance company gave us $700 for it, we were dismayed to say the least! We accepted it of course and moved on (what choice did we have, right?)

Recently she was broadsided by someone who ran a red light in a pickup truck. So 19 years later we found ourselves in virtually the same situation. Again, the car was in great shape and in my experience had at least another 80,000 miles on it. I’ll give you some examples of that maintenance later on.

I just have to mention, there is nothing more important to me than the well being of my family and on top of that list is my wife. I love her dearly and we were lucky in this case that although she was seriously injured in this accident she is recovering slowly but steadily. If at any point in this process I would have had to choose between money and her well being I would have chosen her well being every day of the week and twice on Sunday!

The day of the accident I was lucky enough to arrive on the scene within a few minutes. It was fairly close to our house and Rebecca called me within minutes of the accident. So after taking care of her I broke out my cell phone and took as many pictures as I could in between talking to the paramedics, the police, and the tow truck operator.

So we knew that we would never get what it was worth to us from it. This time I wasn’t as willing to accept that and I started to researching it.
What is a Total Loss?

Simply put a “Total Loss” is when the repair costs of the vehicle exceeds the value of the vehicle. With newer vehicles there can be a fine line between what it is worth and what it will cost to repair. In our case the repair costs were greater than the value of the care by about $4000 dollars, not to mention the fact that in the quote from the auto body shop included a contingency that the repairs need to the frame of the vehicle could exceed what was estimated.

In my opinion there is no way that frame could ever have been properly straightened. In this scenario it was clear that the car was a total loss. In a scenario with a newer car you might have to convince your claims adjuster the car needs to be totaled rather than repaired. I can only tell you that it is indeed true that once a car has been in an accident it is never quite the same. There can be no better example of that then when the frame is bent and needs to be straightened.

Yes, precision body shops do an awesome job of straightening frames and repairing mechanical damage, and I’d venture to say that with some shops they can get it nearly perfect again. At least enough that you don’t have to worry about the integrity of the vehicle and that it is absolutely safe to drive. I’ve seen it done so I know what’s involved, but ultimately it will never be what it was. So if the decision is a close one whether to total it, I would choose to total it. The decision is yours.

The Initial Proposal and what your Claims Adjuster will provide you

In our case there was never any doubt it would be totaled. A few days after receiving the car, the auto body shop produced a detailed report of the damages and the needed repairs. This was immediately forwarded to the claims adjuster.

Again, I’ll repeat myself and say “Be Nice”, regardless of the people you work with at the insurance company most don’t have any influence over the general policies implemented by the company. They do, however, have influence over the steps that can be taken as part of the process. They may not “volunteer” those steps to you right away, but they will help you, so be nice to them and remember to take a break from negotiations when needed.

So after they get the what they call the “Estimate of Record” from the body shop, they will then determine whether it is a Total Loss. To do that they will get a report from a electronic service that will determine the value of your car. If the value of your car is less than what it will cost to repair it, it is a Total Loss.

Two common companies that provide valuation services to Insurance Companies are linked below:
CCC Information Services

Audatex North America, Inc.

You can visit these sites to get an idea of the types of service they provide. I would provide you with an example but I don’t want to violate any proprietary information from that company. So what I did was create my own home-grown example of the type of information they provide and some explanation of what you are looking for.

Click here to go to that page

In the meantime we will continue with the process…

Now, most companies will provide you with a copy of the valuation report right away, in fact I believe that’s the law in most states. If for some reason they don’t, request that they send you a copy right away. In addition, they may be able to provide you with details of the report. For Instance, in my case the report listed that they surveyed a total of 30 vehicles to come up with the averages they used. You should be able to request the actual details of these 30 vehicles to get an idea of what they are basing it on. The more information you can get the better. If you can’t get this detail, don’t worry about it at this stage, there are quite a few things that can be done without it. In some ways it’s almost irrelevant to what you have to do, I will explain that next.

To be continued... until that time don't hesitate to contact us if you have questions...

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