You can fight an insurance company over a totaled car’s value by sending the insurer a counteroffer along with evidence justifying your car’s value. If the insurance company does not raise its offer, you can contact your state’s insurance regulator, seek arbitration, or file a lawsuit. However, it’s important to remember that insurance companies are only required to pay a car’s actual cash value (ACV), not the cost of a replacement car or the original price you paid for the vehicle.
Car insurance companies and state laws determine when a car is declared a total loss, so it is unlikely that you will be able to keep your insurer from totaling the car if they deem it necessary. But you can negotiate with your insurance company if you think the amount they propose the car is worth is less than the car's ACV.
Receive a settlement offer from the insurance company.
Gather evidence, including an independent appraisal, the car’s sticker details, prices for comparable vehicles, photos of the car before the accident, and receipts for any features you added.
Send this evidence and a counteroffer to the insurance company.
If the insurance company does not negotiate to your satisfaction, contact your state’s insurance regulator to request help.
Ask your insurance company for third-party arbitration if necessary.
File a lawsuit as a last resort.
It’s in the insurance company’s interest to prevent a dispute from escalating, so sending a counteroffer directly is the best place to start. Otherwise, the cost of filing a lawsuit is usually not worth the potential rewards, but it depends on your situation.
When your car is a total loss, it means the car cannot be repaired safely or that repairs would be too expensive compared to the vehicle’s value. If your car is declared a total loss due to a covered scenario, the insurance company will pay you the car’s actual cash value and will usually sell the vehicle as scrap.… read full answer
Once you file a claim, the insurance company will determine whether the car is a total loss. Depending on your state’s laws, your car may be totaled if the cost of repairs exceeds a certain percentage of the car’s value, such as 75%. If your state does not have a specific total loss threshold, your vehicle will be considered a total loss if the cost of repairs plus the salvage value is greater than the car’s actual cash value (ACV).
Yes, an insurance company can force you to total your car because state laws regulate when cars need to be totaled. Your only option is to negotiate with your insurer about the car’s value, as convincing the insurer to adjust the value might affect whether the car has to be totaled according to state law.… read full answer
Cars are totaled when the cost of repairs exceeds either the vehicle's pre-crash value or a specific total loss threshold established by the state. For instance, in New York, a car is considered totaled if the cost of repairs is more than 75% of the vehicle’s actual cash value (ACV). Total loss threshold laws account for the fact that damage is often more extensive than it first appears.
It’s also important to note that the ACV is not the price you paid for the car. Instead, the ACV is an approximation of the car’s worth just before it was damaged, so it factors in things like depreciation and mileage.
What You Can Do If Your Insurance Company Wants to Total Your Car
Even if you don’t want your insurer to total your car, you can’t argue with your state’s total loss threshold or ask the insurer to use a different system. However, you can argue that your car was worth more than the ACV chosen by the insurer.
Just bear in mind that you cannot simply choose an estimate based on your own opinion. Instead, you need to provide justification for your estimate of the car’s value, such as an independent appraisal, photographs of upgrades or modifications you made to the car, and/or the prices of comparable vehicles for sale in the area.
If the insurer does not agree with your statements regarding the car’s ACV, you can reach out to your state’s insurance regulator for help. You can also seek arbitration or litigation, though legal fees are likely to decrease or even negate any monetary gains that you make.
The best way to make the negotiation process move smoothly is to document your property damage and medical expenses as much as possible. The more evidence you have, the better your chances are of having your claim settled. Generally, bodily injury claims are more complicated to settle than property damage claims.
You should also remember that insurance companies don’t always operate with your best interests in mind. So, don’t feel obligated to accept the first settlement offer that they make, especially if you know that you’re entitled to more.
If negotiations are unsuccessful, you can consider hiring an attorney to help you through the process. But if you think the insurer is acting in bad faith, then you should report them to your state’s regulator.
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