Your Vehicle is a “Total Loss” - What’s the Next Step?

A “total loss” means it will cost more to repair your automobile than its fair market value (70% of the FMV). Insurance companies vary on their determinations of both the fair market value and the cost to repair as well as on the percentage to classify the automobile as a total loss. Some insurance companies use 70% of the fair market value and others use “in excess of” 70%. However, the most controversial area of the property damage assessment is the fair market value of a " comparable vehicle". Here are a few examples of how insurance company adjusters harm the public:

A. My client, the owner of a medium-size truck with a 30-foot bed (the portion of the vehicle beyond the passenger area) was offered $12,000 by the insurance company for the “total loss” of his truck. As we investigated the written evaluation of the insurance company, we found that the alleged “comparable” vehicle on which their offer was based had a 24-foot bed and not a 30-foot bed. Through the negotiation process, we demanded $16,000 for the total loss of my client’s truck and settled at $15,700.

B. Another recent example involved a small SUV for which the insurance company alleged to have found a “comparable” vehicle valued at $6000. We reviewed the insurance company’s appraisal and found through searching through various databases that there were actually three different models of our client’s vehicle. The insurance company selected the least expensive model to use as a comparable” and our client’s model was the most expensive one. Our client’s vehicle had four-wheel drive, leather seats, alloy wheels, a moon roof, and a high-end radio with CD disc player. We provided the insurance company with a much higher property damage assessment based on the correct model and obtained a 25% increase over the insurance company’s offer.

In some cases, clients prefer to have their property damage assessed by their own insurance company. In part this is because the client believes their own insurance company will treat them better than the insurance company that represents the negligent driver. Unfortunately, going to your own insurance company may not result in a better offer. Here is one reason why. Insurance companies are very competitive in seeking new business and will attempt to attract new policyholders by offering large premium discounts. My opinion is that insurance companies that offer a high discount on the premium cost will make up their discount by paying less in benefits to their policyholder. The adage " you get what you pay for" is applicable for many of the insurance companies that allege their annual premium is highly discounted. If you have your own insurer evaluate your vehicle, you can still have the property damage appraised by the negligent party’s insurance company and perhaps receive a higher offer. Also, in addition to the offer for the total loss of your vehicle, you are eligible for car rental from the negligent driver's insurance company for 3 to 7 days. Insurance companies, as a standard, consider this to be a reasonable time in which you should be able to find and purchase a replacement automobile.

Most personal injury attorneys will tell their clients to handle their property damage with the insurance company on their own. Part of the reason those lawyers have the client work it out is that the attorney would have to charge the client a fee for negotiating the property damage issue. However, we handle personal injury cases on a percentage of the outcome of the bodily injury settlement or judgment and we negotiate with the insurance company on the property damage without charging our clients unless we have to file a lawsuit.

Fred Antenberg has over 30 years’ experience representing seriously injured clients and successfully negotiating property damage claims. Call Fred today at 410-730-4404 for a free initial consultation.