Need help with damages for a car that was totaled

Question

I was the owner of a 2000 Honda Civic VP with about 90,000 miles. I took a trip to recently, and while coming down a steep hill with a steep curve while it was raining, and the car spun out and went into a ditch. The car is totaled, but fortunately their were no injuries. Alcohol and drugs played no role in the accident, and the police were notified and a report was made. This was the first time in my life that I have been in an accident, and I have a clean driving record, not even any traffic citations. I was not driving at the time, a friend was.

The company that I insured my car through also provides me with my loan for the vehicle. I have about $6,000 to pay off on the loan, and they are offering me about $6,500. A quick check of the Kelly Blue Book value indicates the car is worth about $8,000 in my area (Pennsylvania / NJ) in excellent condition. I inquired as to how they evaluated the condition of the car, and they told me most things were rated as average with several things being rated above average.

I don't think I should take this. I wouldn't sell that car for $6,500. I have a feeling they are trying to cover the loan and give me minimal compensation. I am looking for advice about what sources I should consult and how I should proceed with negotiating what I feel would be compensation that is fair. I think I should receive something slightly less than the Kelly Blue Book value (considering that the car was probably not in excellent shape, but for all intents and purposes, it was very close). I'd prefer expert advice, and I am reluctant to bring this to court, but will if I have to. Thank you for any assistance you provide.

Answer 1

I don't think they are out of the range of true value. They are correct in stating most cars fall into the average category. You may ask for more, but I sure wouldn't threaten them with court. You would probably not get any more money, and will incur costs. Hit your pal up for the remainder, he was the one driving!

Answer 2

No insurance company goes by the Kelley Blue Book. If you read the fine print -- it says that the value given in Kelley is just a starting point for negotiation - not what the vehicle would sell for. Their value also includes advertising, sales commission, reconditioning the vehicle. These have nothing to do with the vehicles value.

Also -- I highly doubt your car was in "excellent" condition. Did you really steam clean the engine, have receipts to prove you changed the oil every 3500 miles?  See my point. Most vehicles are average condition.

The industry standard -- the book used by insurance companies and banks is the NADA (National Automobile Dealers Association) book. They have a web site as well: www.nadaguides.com. Be aware "high retail" only shows up on their web site. This category is not even listed in the actual book - so disregard this value. Most cars are "clean retail" at best - and not all of them are that.

Many insurance companies use market survey programs (such as CCC and Total Logic) to value a car. These get their values from cars that were actually sold. This is the most accurate judge of a vehicles value.

So...if you think you are going to get full Kelley excellent retail value-- you're over valuing your car.

As far as court goes..... lawyers do not work for free. Any attorney you hire to sue your insurance company is going to have to be paid. Even if you got the value you wanted - you would still end up short b/c the attorney takes his fee from the settlement (that's what they mean by we don't get paid if you don't get paid).

Also - your policy probably has an appraisal provision in it.  It's a pretty standard clause. Here's how it works -- you would send a request in writing to your insurance company to invoke the provision.

You would hire a competent appraiser of your choice. Your insurance company hires a competent appraiser of their choice. The two appraisers decide on an umpire. The 3 of them determine the value of your car. You pay your appraiser and 1/2 of the umpire, and your insurance company pays their appraiser and 1/2 of the umpire. The appraisers can not award you the fees -- meaning - they can't make the insurance company pay for your appraiser and your share of the umpire.

This clause is important for another reason....your policy also has language in it that says you have to follow your duties under the policy in order to take legal action against them. You sue - they will invoke the appraisal provision - and your suit will get kicked out of court b/c you have not full filled your policy duties because you have not gone through the appraisal provision.

So....here's what I recommend -- take an honest look at your car - remove the rose colored glasses. Odds are- it's in average condition for it's age. Then do a market survey of your own - autotrader.com, cars.com -- see what car's like yours (including the mileage) are going for. Forget Kelley Blue Book - don't waste your time further there -- check out NADA. Ask your adjuster to show you how they got the figure they are offering. And if worse comes to worse - invoke the appraisal provision.

P.S. Insurance follows the car -- not the driver. You gave your buddy permission to drive - so your collision coverage pays.

Also -your buddy does not owe you the difference. Legally all he would owe you is the fair market value of the car -- and for the reasons stated - Kelley is not it.

Answer 3

First of all, the driver of the vehicle is responsible. You should be taking this up with his/her insurance company since you weren't behind the wheel. Their insurance covers any vehicle they drive, including yours.

Answer 4

Total losses are not settled based on Kelly Blue Book. You will receive an offer based on Actual Cash Value (ACV), which is basically what other cars with similar mileage and same condition are selling for in the marketplace. It is not usually anywhere near KBB. While there is room to negotiate, I would not expect you to get an offer of 8k. Your vehicle is 9 years old and has just under 100k miles. It's assumed that the vehicle has been maintained as well. You will not succeed in court if the company can provide documentation supporting their evaluation.  

Answer 5

I had to get an attorney to get $214 more for my car than the company offered me.

I felt I could NOT replace my car with the money they offered me - I did not think it fair - But it's not about replacing your car - it's about what it's worth even IF it's totaled (not fair to the victim )

Supposedly I got the $ I asked for - june 18th - and I await payment still yet.

In your case I don't recommend an attorney - because he WOULD take any extra $ you would recieve (my attorney is my brother in law & I was injured so I will be recieving more compensation)

My attorney's advice to me (he handled it) but I had to look at what (my year/make ) car was SELLING for currently & he took that info to the insurance company to fight for my $214.  

And I am in the "awaiting payment" stage of the insurance game now.