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Negotiation with Insurance company after the car was totaled

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I had an accident and my car was totaled.The insurance company offered me $16,680 for settlement, which I feel it is a bit low.  A replacement for the same model and same condition will cost at least $20,500 in my area.I finally received their valuation report today.  Upon checking, I feel they valued my car unfairly:

  • 3 cars were used for comparison. 2 of them are lower trim model (less options and typically lower value).  The other is the same model but it was in an accident and was in the market for over 190 days (still not sold - very low price and not getting sold)
  • They deduct values very aggressively: my car has 61500 miles, about 2600 miles over the 'typical mileages' according to kbb.com, yet they cited it as 'high milesages' and deducted $692.00.
  • My sunroof was in good shape (never used!), but has some willow catkins on it(it was left outside after the accident) - they deducted $200.00 because "large water stain"
  • I provided invoice of 4 new tires replacement about 4 months ago, cost around $500.00.  They agreed the tires are in excellent condition, but only gave credit $50


When I called them and said I disagreed with their valuation based on the above, I was told "a Collision policy affords a settlement according to actual cash value, not a replacement. If the vehicle used for comparison was repaired and has a non-salvage title, it can be considered for evaluation purposes." so they would not change their valuation. 

I was given 2 options: either accept this offer, or hire an independent appraiser.Should I just accept their offer and move on?  Hiring an independent appraiser seems to be lots of hassling (I dont even know where my car is now).  Will the insurance company accept a higher price if the independent appraiser values my car higher?  Or do I have any other options?

Any advise is greatly appreciated!

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Probably because the NADA is much higher. Might have to threaten to take them to court if they don't pay the NADA value.... (more)

atikovi (Apr. 22, 2017 @ 7:45a) |

What is the cash value of a car, but the price identical cars sell for?  You need to forget the fallacy of "replacement ... (more)

Glitch99 (Apr. 23, 2017 @ 8:06p) |

Go back at them with concrete numbers. I went through this with lizard, found my own comps, adjusted for things that wer... (more)

scrouds (Apr. 23, 2017 @ 10:27p) |

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rated:
Their first offer is ALWAYS a low ball.

They are not required to give you an equivalent car, just what the used car value is on KBB.
I think the 'independent appraiser' is a bluff, why would an insurance company accept someone else. Just ask them for $2000 more and see what they say.

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forbin4040 said:   
I think the 'independent appraiser' is a bluff, why would an insurance company accept someone else. Just ask them for $2000 more and see what they say.

  And, (obviously??? )  send them quotes/ads (Autotrader/etc) for those like used vehicles that are ~$2000 more than the $2000 more you ask them for.

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Bend3r said:   
forbin4040 said:   
I think the 'independent appraiser' is a bluff, why would an insurance company accept someone else. Just ask them for $2000 more and see what they say.

  And, (obviously??? )  send them quotes/ads (Autotrader/etc) for those like used vehicles that are ~$2000 more than the $2000 more you ask them for.

  
I did.  Their response is: "a Collision policy affords a settlement according to actual cash value, not a replacement.", so I focused on how my car is being valued. 

Like I said, I feel the base value was low since the cars they used for comparison (hence to determine the base value for my car) are either with lower options or even with accident history, and their adjustments are very unreasonable.

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As I said, they will always lowball you, and they are thinking you will fall for the 'hardball' ploy. There is no insurance company that will do '1' offer and go away, they are hoping you go away

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eljamesyu said:   
Bend3r said:   
forbin4040 said:   
I think the 'independent appraiser' is a bluff, why would an insurance company accept someone else. Just ask them for $2000 more and see what they say.

  And, (obviously??? )  send them quotes/ads (Autotrader/etc) for those like used vehicles that are ~$2000 more than the $2000 more you ask them for.

  
I did.  Their response is: "a Collision policy affords a settlement according to actual cash value, not a replacement.", so I focused on how my car is being valued. 

Like I said, I feel the base value was low since the cars they used for comparison (hence to determine the base value for my car) are either with lower options or even with accident history, and their adjustments are very unreasonable.

Curious to see how this will play out. Are they paying for a rental?
You didn't say if you're at fault or someone else. Are you talking to your insurance or third party? If third party, you have no obligation to adhere to their policies. They have an obligation to make you whole. If you can easily prove that 2 of the 3 cars they used are not comparable and one is in worse condition, you have a good case. Maybe independent appraiser is not such a bad idea. I used one for DV claims and it helped in one case and didn't help in another. Consider talking to a lawyer as well.
Also don't forget to add your state sales tax, registration, document fees.

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forbin4040 said:   As I said, they will always lowball you, and they are thinking you will fall for the 'hardball' ploy. There is no insurance company that will do '1' offer and go away, they are hoping you go away
  
They basically said that they are ready to move forward if I want to, but so far they refused to reconsider any revaluation.  So if I neither accept the offer, nor find an independent appraiser, what will happen next?

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Yoksel said:   
eljamesyu said:   
Bend3r said:   
forbin4040 said:   
I think the 'independent appraiser' is a bluff, why would an insurance company accept someone else. Just ask them for $2000 more and see what they say.

  And, (obviously??? )  send them quotes/ads (Autotrader/etc) for those like used vehicles that are ~$2000 more than the $2000 more you ask them for.

  
I did.  Their response is: "a Collision policy affords a settlement according to actual cash value, not a replacement.", so I focused on how my car is being valued. 

Like I said, I feel the base value was low since the cars they used for comparison (hence to determine the base value for my car) are either with lower options or even with accident history, and their adjustments are very unreasonable.

Curious to see how this will play out. Are they paying for a rental?
You didn't say if you're at fault or someone else. Are you talking to your insurance or third party? If third party, you have no obligation to adhere to their policies. They have an obligation to make you whole. If you can easily prove that 2 of the 3 cars they used are not comparable and one is in worse condition, you have a good case. Maybe independent appraiser is not such a bad idea. I used one for DV claims and it helped in one case and didn't help in another. Consider talking to a lawyer as well.
Also don't forget to add your state sales tax, registration, document fees.
 

  
It was my fault. so I am dealing with my insurance company.  I have a spare car so I cancelled the rental option earlier this year.
How much it will cost me to hire an independent appraiser ?
A lawyer typically wants 30% cut, in my case, it does not seem to be feasible as the upside for me is very limited.
 

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My DV appraiser charged $250 but that was a while ago. It's possible to find online appraiser who will do the paperwork based on photos and descriptions. The nice part about having a local one is that he was willing to testify, if necessary.

A lawyer may help you put together a proper letter showing that you're ready for a fight.

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forbin4040 said:   As I said, they will always lowball you, and they are thinking you will fall for the 'hardball' ploy. There is no insurance company that will do '1' offer and go away, they are hoping you go away
  
That is not always true, my stepmother wrecked her truck (her fault) and her insurance company (21st/Farmers) used a third party company to estimate the value and it was actually very fair.  Their final value was only about $2000 less than I paid for the vehicle 5 years earlier.

It helped that it was "totalled" so that they had the vehicle to look at condition.  I had a motorcycle recently stolen and I expect to have a fairly annoying time.  The tires were 2 *days* old.  Registration, taxes and title -- and transfer to my existing TX motorcycle policy was 2 weeks before.  The paperwork is a magnitude less "trusting" and "designed to be a PITA" over a total loss in an accident.  At least 3 times counting the police report I had to swear or have notarized that I had nothing to do with it being stolen.  

I suspect I will have a less pleasant experience with Sentry than I did with Farmers.... 

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RedWolfe01 said:   
  
That is not always true, my stepmother wrecked her truck (her fault) and her insurance company (21st/Farmers) used a third party company to estimate the value and it was actually very fair.  Their final value was only about $2000 less than I paid for the vehicle 5 years earlier. 


I agree. I think I got a fair offer from Liberty mutual as well. If I search on cars.com for the same model with similar mileage, I can find many cars with asking price at or a little lower than they offer me. Sure, we didn't get the top 40% highest price that we found on cars.com but I doubt those dealers will be able to get those high asking price.

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eljamesyu said:   I feel the base value was low since the cars they used for comparison (hence to determine the base value for my car) are either with lower options or even with accident history, and their adjustments are very unreasonable.
What do you mean, the cars they used for comparison? Unless this is some exotic, they open the NADA Blue Book and look up the value adding or deducting for mileage and options. No need to find comparisons. If you recently bought new tires, that doesn't really play into the value as a car is expected to have good tires. What is the NADA retail value?

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My parents totaled a car with less than one week on the tires. Farm Bureau claims adjuster asked them for the receipt, added half the cost of the tires to the payout under the theory that the average car has half worn tires on it. Dad still wished he hadn't bought the tires.

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It's been a while since I had a totaled car, but when I did, I had to negotiate with the insurance company (state farm at the time, I think). I had recently had new tires/wheels put on it as well and they added that cost to the appraisal in full (IIRC). I had to submit comparable sales data to counter their comparables to get a better offer from them and we did finally settle on a better number. Then the add sales tax, title, and registration transfer fees to that.

The insurance is supposed to make you whole. It doesn't make you whole if you still have to pay taxes and fees on the replacement vehicle. And them talking about ACV vs. replacement is semantics. Replacement cost IS ACV when you are talking about replacing with an identical item, age, condition, etc. You're not talking about replacing with NEW. Tell them to pound sand and find you another car in the exact same condition, mileage, options, colors, tire wear, etc. Obviously they can't so they have to come to some kind of terms with you on value.

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Have you tried to escalate to a supervisor? That seems like a pretty big gap in values. If they truly are not comparing apples to apples, they should be open to re-assessing their evaluation.

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Why are people so weird about just saying what the car is? It's more helpful that way. Anyway, I have totalled 3 cars with State Farm, and they always took NADA Retail + Tax - Deductible and cut me a check. Are you using a large national insurance company?

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shadow520 said:   It's been a while since I had a totaled car, but when I did, I had to negotiate with the insurance company (state farm at the time, I think). I had recently had new tires/wheels put on it as well and they added that cost to the appraisal in full (IIRC). I had to submit comparable sales data to counter their comparables to get a better offer from them and we did finally settle on a better number. Then the add sales tax, title, and registration transfer fees to that.

The insurance is supposed to make you whole. It doesn't make you whole if you still have to pay taxes and fees on the replacement vehicle. And them talking about ACV vs. replacement is semantics. Replacement cost IS ACV when you are talking about replacing with an identical item, age, condition, etc. You're not talking about replacing with NEW. Tell them to pound sand and find you another car in the exact same condition, mileage, options, colors, tire wear, etc. Obviously they can't so they have to come to some kind of terms with you on value.

  Exactly

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taxmantoo said:   My parents totaled a car with less than one week on the tires. Farm Bureau claims adjuster asked them for the receipt, added half the cost of the tires to the payout under the theory that the average car has half worn tires on it. Dad still wished he hadn't bought the tires.
  That's just how it goes unfortunately. I thought about repairing my wife's engine vs putting a new one in a few months back and insurance value was a consideration. I wouldn't expect them to pay an extra $3k or more for the engine. 

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OP your ins. offered $16,680. What is the lowest you'd accept? What's the lowest you think is fair?

Is your ins. co. a budget ins. co. or a premium branded one?
 

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zapjb said:   OP your ins. offered $16,680. What is the lowest you'd accept? What's the lowest you think is fair?

Is your ins. co. a budget ins. co. or a premium branded one?

 
my insurance company is AllState.
I think $18,000 is fair price
 

rated:
atikovi said:   
eljamesyu said:   I feel the base value was low since the cars they used for comparison (hence to determine the base value for my car) are either with lower options or even with accident history, and their adjustments are very unreasonable.
What do you mean, the cars they used for comparison? Unless this is some exotic, they open the NADA Blue Book and look up the value adding or deducting for mileage and options. No need to find comparisons. If you recently bought new tires, that doesn't really play into the value as a car is expected to have good tires. What is the NADA retail value?

  
These days they use comparable vehicles in the same city, usually one better equipped, one less, and one as close to possible to the same.  Then they come up with a mid-range and add/subtract the specific differences like mileage/customizations/features that are different than the median.  They use a third party service - the idea is to get a true idea what you can actually buy a replacement vehicle in your area for.  Then they add the taxes/registration costs and subtract your deductible and make you an offer.

Sentry hasn't even made me an offer and already want the keys and title.

rated:
So your insurance company really doesn't have to use NADA or Blue Book. At Progressive we used an outside company...sent them the info (10,000 miles, perfect interior, 1 inch scratch to clear coat or whatever) and they sent us back the valuation with comps. The comps were not perfect, of course, which is why the "average" car would pop up and "your car" would be next to it with either (+) or (-) $ for each and every line item. It took a LOT to get those valuations changed. We had to justify EACH line item with pictures.  If you hire an independent appraiser it's at your own cost, isn't guaranteed to get you anything, and tends to be expensive... just FYI.

http://www.dmv.org/insurance/actual-cash-value.php

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When they send you a list of the comps they use ,call the dealers with the cars listed .You will find that most of them were sold quite a long time ago so they are not valid comps.Also expect the

adjuster to be deceitful as well .They will do most anything to settle for the least amount.This was my experience two years ago with progressive claims.They accepted full liability for their at

fault driver. Look up your own comps with vehicles that have maintenance records then add any mechanical repairs recently done.

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I've never had a full claim, but I've negotiated minor incidents and gotten better payouts as a result, so I support the others telling you to negotiate. Just build a strong case that makes sense to you and badger the crap out of them about it. Send comps, call those dealers, do it all. Don't ever say 18k though, say 20k and plan to get it if that's the value.

Also, if it's going no where then stop calling them. It's harder to document stuff over calls. Mail correspondence is best and keep copies of what you send them. I've spent hours on the phone arguing with reps, only to send a letter and have the issue resolved without any further effort. People that open letters process the contents. People that answer phones at insurance companies enforce policies.

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nesaline said:   So your insurance company really doesn't have to use NADA or Blue Book. At Progressive we used an outside company...sent them the info (10,000 miles, perfect interior, 1 inch scratch to clear coat or whatever) and they sent us back the valuation with comps. The comps were not perfect, of course, which is why the "average" car would pop up and "your car" would be next to it with either (+) or (-) $ for each and every line item. It took a LOT to get those valuations changed. We had to justify EACH line item with pictures.  If you hire an independent appraiser it's at your own cost, isn't guaranteed to get you anything, and tends to be expensive... just FYI.

http://www.dmv.org/insurance/actual-cash-value.php

  
Yes, this is EXACTLY what they  told me - they are not required to use NADA or KBB figures, instead their adjuster has their own methods for the valuation, and they insisted this is not changeable unless I choose to find an independent appraiser...

rated:
yaknart33 said:   When they send you a list of the comps they use ,call the dealers with the cars listed .You will find that most of them were sold quite a long time ago so they are not valid comps.Also expect the

adjuster to be deceitful as well .They will do most anything to settle for the least amount.This was my experience two years ago with progressive claims.They accepted full liability for their at

fault driver. Look up your own comps with vehicles that have maintenance records then add any mechanical repairs recently done.

  
1 car was already sold.  1 car was the one with accident. But Ins co said that it was OK for them to use market data within 90 days.

rated:
TecJunkie said:   I've never had a full claim, but I've negotiated minor incidents and gotten better payouts as a result, so I support the others telling you to negotiate. Just build a strong case that makes sense to you and badger the crap out of them about it. Send comps, call those dealers, do it all. Don't ever say 18k though, say 20k and plan to get it if that's the value.

Also, if it's going no where then stop calling them. It's harder to document stuff over calls. Mail correspondence is best and keep copies of what you send them. I've spent hours on the phone arguing with reps, only to send a letter and have the issue resolved without any further effort. People that open letters process the contents. People that answer phones at insurance companies enforce policies.

  
Good point!   I had asked for escalation, but was only given a supervisor's phone #.  Maybe I just send a mail and see.  thanks

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I have USAA and my 2012 ford fusion was totaled when a friend was driving it and i dont know if the value was fair or not but after they paid the lien i was left with $7k

Last mth i bought an old car for $2k i was hit by an uninsured driver and they called it a total loss and gave me $4k + the car, the damage is not even that bad i could have it fixed for about $800

So basically this car was free after rebate and i got $2k from the insurance lol

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eljamesyu said:   Yes, this is EXACTLY what they  told me - they are not required to use NADA or KBB figures, instead their adjuster has their own methods for the valuation, and they insisted this is not changeable unless I choose to find an independent appraiser...
  Probably because the NADA is much higher. Might have to threaten to take them to court if they don't pay the NADA value.

rated:
eljamesyu said:   
Bend3r said:   
forbin4040 said:   
I think the 'independent appraiser' is a bluff, why would an insurance company accept someone else. Just ask them for $2000 more and see what they say.

  And, (obviously??? )  send them quotes/ads (Autotrader/etc) for those like used vehicles that are ~$2000 more than the $2000 more you ask them for.

  
I did.  Their response is: "a Collision policy affords a settlement according to actual cash value, not a replacement.", so I focused on how my car is being valued. 

Like I said, I feel the base value was low since the cars they used for comparison (hence to determine the base value for my car) are either with lower options or even with accident history, and their adjustments are very unreasonable.

  What is the cash value of a car, but the price identical cars sell for?  You need to forget the fallacy of "replacement value" (or tell them to forget it, if they're the one who brought it up), and tell them you will gladly take the cash value of your car - but they're offering the cash value of some random lower trim/quality cars.   

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Go back at them with concrete numbers. I went through this with lizard, found my own comps, adjusted for things that were different. And emailed it back to adjuster. The said they had to run it into their system. In the end the offer was adjusted up 1.5k,

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