Son had car accident last night - Insurance question for the Aussies . .?

Question

OK - so it was this lady's fault, smashed right into him. She’s admitted was her fault and she has full insurance, my son only has 3rd party.

Both doors and pillar damaged (maybe structural as well)

It’s not an expensive car, my son is 17 – first car, couldn’t afford a flash one – anyhow, so I would think the repairs would outweigh the cost of the car.

So does Insurance only pay out the market value only, or market value plus a bit more, or trade in value…

What could I expect as I’ve never dealt with Insurance before, just heard they s***w everyone over :-(

Thanks.

Answer 1

Damages cover the loss, which is the lesser of market value or the cost of repairs.

Answer 2

Your son should make sure that he puts into the accident report, exactly what the other driver said when admitting fault and that he also includes every possible detail of the incident while it's still fresh in his mind.

I've never had 3rd party only insurance, but I did think it only covered the cost of repairs to the other car. Perhaps when the other driver is completely at fault and there is no question regarding that, the other company may pay market value for your son's car, but I wouldn't count on it.

Answer 3

unfortunately most insurance companies only pay market value

Answer 4

The basic idea of insurance is that if the car is a write-off (which is what it sounds like... since you say that it would cost more to repair?) they will replace it with a similar one.  Unfortunately, being insurance companies, they won't go out of their way to give you a good deal, but you should get a reasonable amount back.

Just a couple of things - make sure your son writes down every little detail he can remember.  Although the woman said it was her fault, it is likely for her to change her mind later on.  (My mum had a crash and the guy agreed it was his fault... a year later the insurance company rang us and said that he was claiming it to be our fault... thankfully we had photo evidence and our written 'statements' to prove that it wasn't)  Anything you can do while it is still fresh in his mind - including photos, writing anything he remembers, etc - will be good backup if anything happens later down the track.

Answer 5

Alas, my dear bear, you will most likely get 'market value' as assessed by the (other party's) insurance company - not 'trade-in value'.

You had also better hope that the insurance company doesn't contest the claim - which they can do, despite the other driver admitting fault - in which case with 3rd party property damage, your son's damages will be all up to him.

Cheers.