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Way OT: Auto insurance and a totaled car!


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I know there are folks from all walks of life on this forum so I'll chance going into way OT territory here in hopes someone knows about or has been through this. My wife hit a deer on the way to work (well it was kind of the other way around actually!). She's fine, but the car had pretty major front end damage. The insurance adjuster sees the car and declares it totaled because in our state, if the repairs cost 75% or more of the car's value they have to declare it totaled ("my hands are tied" he says). The adjuster explains our two options: 1) they give us a check for the value of the car, minus our deductible ($500), then take possession of the car and presumably sell it to a salvage yard. Option 2: we get a check for the value of the car, minus the deductible and salvage value of the car. We then get the car fixed, after which it needs to be re-titled as "salvage" or "rebuilt." The car would also need to be inspected to make sure the repairs were done right.

 

After all this sturm und drang we decide on option 2 (keep the car, get it fixed). Now comes the interesting part - our guy at the body shop comes up with his estimate and it's almost $2K lower than the insurance co. adjuster's! So assuming the estimate holds, the cost of repairing the car now does not meet the percentage threshold needed to declare the car totaled in our state. I'm leaving out a few details because this post is too long but the upshot is this: things are in motion for me to settle on option 2 and get a check where I will actually MAKE money! My inclination is to tell the insurance company that my guy can fix the car for way less than their estimate and I'd be OK with paying my $500 deductible. Why? Because, well, it seems like the right thing to do; not only will I save the insurance co. money but I've read that cars with salvage/rebuilt titles are harder and/or more expensive to insure and that I may not even be able to get collision insurance on it. Because we keep cars a long time, I think it will be cheaper for me to pay the $500 deductible and keep the regular title.

 

My question is, if I bring this up to the insurance company, am I going to screw myself? Is there something I'm missing â for example, it's in their interest to declare the car totaled, and my stirring the pot might cause them to call my body shop and have him jack up the estimate? Should I "leave sleeping dogs lie" here?

 

Since this post is already long I might as well add a pretty salient fact: the car is financed with a 5-year loan, and we got the car 9 months ago (it's certified pre-owned). If we take option 1 above (they junk the car), after we pay off the loan we're left with between $0 and $500 to get a new car with â not workable!!

 

Thanks in advance for insights in how to deal with this mess!

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Don't tell the insurance any thing, they aren't looking out for your interest. Keep your title if you're going

to take the vehicle, but you better have a good relationship with the repair company and the owner. I

know my guy and he does great work at a fair price. If you need to for what ever reason go searching for

the estimate you need to satisfy your requirements, you don't need a relationship for estimates keep

as much of your info vested as possible.

Triton Extreme 76, Kawai ES3, GEM-RPX, HX3/Drawbar control, MSI Z97

MPower/4790K, Lynx Aurora 8/MADI/AES16e, OP-X PRO, Ptec, Komplete.

Ashley MX-206. future MOTU M64 RME Digiface Dante for Mon./net

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I hear you, I am thinking to leave things alone but that means we have a car with a salvage title and as I said, harder and more expensive to insure. Why would the insurance co. benefit from writing us a check for $8K versus paying $6500 to get the car fixed? I don't get it.

 

PS - also worth mentioning is that our body shop guy said there is no structural damage to the car and it's completely fixable. He said it's only the high price of the parts that drove the insurance adjuster's estimate over the state threshold for declaring the car totaled.

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I would do option 1 and if car really worth it try to find what salvage yard they sell to and try to buy the car back when they auction it off. I wouldn't do option 2 and definitely would NOT tell them if you got a better deal to rebuild the car. Also ask your insurance company if they have companies that offer discounts to customers from insurance settlements. I had a accident and took a cash payout instead of having them pay for the (cheapest) repair, they gave me the names of a couple places that offered discounts and I was more in control of the repair process.

 

With the C-19 going on car dealers are struggling so deals on new and used can be found. Also the car rental agencies who sell used rentals are trying to really reduce their inventory of rental cars because business is so bad. So there are deals to be had if you're in the market for a car. My old high school buddy is in the same boat as you but due to his daughter totalling a car he had to help her buy.

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I would do option 1 and if car really worth it try to find what salvage yard they sell to and try to buy the car back when they auction it off

 

But that's essentially what option 2 is - they are deducting the "salvage value" of the car (about $1500) from my settlement and letting me keep the car.

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This isn't an ethical thing, it's about doing what is in the financial interest of each entity. They aren't going to care that somebody did it for cheaper and you kept some cash in your pocket. It's strictly a numbers game for them. In order to look out for your own financial interest, consider the resale value of the car with vs without the "salvage" listing on the title. If it is worth more than $2000 more without the salvage listing, then it would potentially be in your best interest to forego the $2000 and also avoid the salvage indication. Of course this also depends on how long you intend to keep it, as that difference will shrink over time.

Dan

 

Acoustic/Electric stringed instruments ranging from 4 to 230 strings, hammered, picked, fingered, slapped, and plucked. Analog and Digital Electronic instruments, reeds, and throat/mouth.

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I had a accident and took a cash payout instead of having them pay for the (cheapest) repair, they gave me the names of a couple places that offered discounts and I was more in control of the repair process.

 

I take it your car was not totaled right? In our state (NY) you can get your car fixed at the body shop of your choice. We've been doing business with the guy for years, he's not unknown to us at all. Yes I was a little surprised at seeing his estimate come in $1500 lower than the insurance adjuster's â I expected it to be more! That's what has me thinking there might be something to this situation I'm oblivious about!

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This isn't an ethical thing, it's about doing what is in the financial interest of each entity. They aren't going to care that somebody did it for cheaper and you kept some cash in your pocket. It's strictly a numbers game for them. In order to look out for your own financial interest, consider the resale value of the car with vs without the "salvage" listing on the title. If it is worth more than $2000 more without the salvage listing, then it would potentially be in your best interest to forego the $2000 and also avoid the salvage indication. Of course this also depends on how long you intend to keep it, as that difference will shrink over time.

 

We drive cars into the ground â so I anticipate we'd have this car for a few more years. Having a salvage title probably (well, definitely) affects its resale value but we don't care about that. What I'm thinking about is strictly the cost to insure it with a salvage title, versus a normal title. That cost differential x the number of years we own the car could add up to a lot.

 

And yea, I know they may not care that I made money on this deal. It just doesn't make sense to me! The bottom line really is financial interest â mine! I think it may be cheaper for us in the long run to have them pay for my repair and keep my regular, non-salvage title! I'm just afraid of opening a can of worms if I bring this up to the insurance company.

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Talk it over with your agent. They get commission and will want to keep you as a happy customer. It's been my experience that an independent agent looks out for your best interest - that is assuming you're talking with the independent agent and not directly with an adjuster or something like that.

Dan

 

Acoustic/Electric stringed instruments ranging from 4 to 230 strings, hammered, picked, fingered, slapped, and plucked. Analog and Digital Electronic instruments, reeds, and throat/mouth.

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That's a good idea except I didn't get our car insurance from an independent agent.

 

I'm actually thinking I might get the adjuster in trouble if I bring this up - he recalculated & raised the valuation of the car, which helped get me a larger settlement! Of course his repair estimate was still over 75% of this recalculated value â by literally a few dollars!

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This isn't an ethical thing, it's about doing what is in the financial interest of each entity. They aren't going to care that somebody did it for cheaper and you kept some cash in your pocket.

 

agreed

:nopity:
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I would do option 1 and if car really worth it try to find what salvage yard they sell to and try to buy the car back when they auction it off

 

But that's essentially what option 2 is - they are deducting the "salvage value" of the car (about $1500) from my settlement and letting me keep the car.

 

 

But your taking what they say the value is not what you can get it for as an individual. The first companies I worked for when getting into computer programing were insurance companies, they are doing what is good for them not you. Why do you think so many people end up getting a lawyer to deal with their own insurance company. Insurance companies pay actuarials a boatload of money to make sure they beating the odds.

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This isn't an ethical thing, it's about doing what is in the financial interest of each entity. They aren't going to care that somebody did it for cheaper and you kept some cash in your pocket.

 

agreed

 

As I said, I agree they may not care about that. It's strictly about my finances - the cost of insuring a car with a salvage title.

 

I would do option 1 and if car really worth it try to find what salvage yard they sell to and try to buy the car back when they auction it off

 

But that's essentially what option 2 is - they are deducting the "salvage value" of the car (about $1500) from my settlement and letting me keep the car.

 

But your taking what they say the value is not what you can get it for as an individual. The first companies I worked for when getting into computer programing were insurance companies, they are doing what is good for them not you. Why do you think so many people end up getting a lawyer to deal with their own insurance company. Insurance companies pay actuarials a boatload of money to make sure they beating the odds.

 

I actually think the value they came up with is fair. I'll also say that the process of finding out where the auction is, traveling there, and bidding along with entities that do this kind of thing full time is daunting and not something I feel would work out in my favor. I mean, I've never bid at any auction, ever. How much less than the $1500 salvage value they're deducting from my settlement could I potentially buy the car for? Of course then I'd have to pay to have it flatbedded back to my body shop. Would all this really be worth the trouble and risk? I'd be happy if they simply paid for my repair and kept the title as is. Yea, the $500 deductible hurts but that's on me, I chose that coverage level.

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Take the money, drive the salvage car into the dirt, by the time you sell it the difference in price won't matter much.

 

Be aware that deer kill more people in the US than any other animal, primarily due to car accidents. They get knocked up over the hood and through the windshield, thrash around and the driver is fatally injured as a result.

 

Once in a while, we win and insurance companies lose.

It took a chunk of my life to get here and I am still not sure where "here" is.
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Take the money, drive the salvage car into the dirt, by the time you sell it the difference in price won't matter much.

 

Resale value-wise, you're 100% right. I'm considering only our cost to insure and the level of insurance we'd be able to get. In the past, our cars usually wind up being donated and picked up by a flatbed as they don't (or barely) run â we'd take a little tax deduction as a charitable contribution. I'm not even sure you can do that anymore. When I say we drive cars into the ground, I mean it almost literally!

 

Be aware that deer kill more people in the US than any other animal, primarily due to car accidents. They get knocked up over the hood and through the windshield, thrash around and the driver is fatally injured as a result.

 

Don't I know it. Our area, north and a east of New York City, has tons of deer. I've heard of a few fatal encounters while I've lived here, and I see deer along the roads quite a lot. My wife was actually pretty torn up about it â she's an animal lover.

 

One small positive in this situation is that I heard insurance cos. can't raise your rates for this kind of claim. I'm not sure if that's true, and I'm sure they could find some other excuse to do it, or drop us completely.

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One small positive in this situation is that I heard insurance cos. can't raise your rates for this kind of claim

 

Hitting a deer while driving is usually considered "no fault" of the driver so yes, rates aren't usually affected.

:nopity:
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This exact same thing happened to me as a young driver at university. Accident, official cost to repair (new body panels etc) more than the value of the car. So I took the car and the payout-minus-salvage-value, and found an old-school bodyshop that could panel-beat my damaged car. The leftover money covered my student overdraft.

 

How old is the car Rob? If you're going to keep it till it falls apart, who cares what the resale value is. If it's a year old and you were intending to sell it in two years, different matter.

 

Cheers, Mike.

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Mike, as I mentioned, I am not concerned about the resale value, only the cost to insure it going forward. As I understand, a car with a salvage or rebuilt title is harder and more expensive to insure. Is this how it works in the UK? I would like to avoid this.

 

The car is a 2013 Toyota that we bought "certified pre-owned" from a dealer nine months ago, with about 85K miles. Normally you don't see cars this old sold as "certified" but that's what dealers here do with cars they've inspected thoroughly and deemed in good-enough shape to warrant the extras that certification brings (which is mostly an extended warranty, a few free fluid changes, etc. We also got a very low rate on an auto loan due to it being certified). The car was in exceptional shape; it almost seemed like a new car since they detailed it, cleaned the engine, did a brake job, and a few more things.

 

Anyway, long story short - we were intending to keep the car as long as we could. My gut is telling me we should avoid having it totaled if possible â but as I said at the top of this thread, I think I need to tread carefully as there may be some angles to what's going on that I'm not seeing.

 

Oh, one more minor detail â my wife will not accept this car coming back to her looking anything other than what it looked like before the accident! That's how she rolls. :)

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(I must learn to read Rob's posts more carefully-this is the second time).

 

In my case, insurance costs were not affected, as the damage was not considered structural/dangerous. Simply that given the age of the car, the cost to repair exceeded the value of the car.

 

Presumably your insurance company could give you a new quote on the basis of a (hypothetical) rebuild/salvage status? That would help you judge whether it's worth keeping/repairing.

 

Good luck.

 

Cheers, Mike.

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Over here in the UK it is different with write off roughly set at 50% of the forecourt value.

 

Our insurance write off is not black and white there are categories like a) shred only b) break for spares c) would be the state of yours ie repairable but at a significant cost n) structurally sound but repairable at a cost.

Col

 

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Why don't you call the company you are currently insured with and ask them what the premium for cover would be if you get the car repaired and the repairs certified?

A misguided plumber attempting to entertain | MainStage 3 | Axiom 61 2nd Gen | Pianoteq | B5 | XK3c | EV ZLX 12P

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Thanks guys for sticking in this thread. I did call my insurance co. to ask how my rates would be affected if I repaired the car and it had a salvage/rebuilt title. They would not give me a straight answer â all they said is that those options would come up when my insurance renews (every 6 months). I was thinking of calling them and pretending to be a new customer with such a car and asking for their rate. However I think they calculate all this stuff based on your driving history, previous claims, location, miles you drive, model car, etc. It's complicated â but the bottom line is that I can't get a straight answer as to whether they'll even continue to insure the car, much less what the level of coverage might be or how much it would cost. This is why I feel it's in my interest to not re-title the car as salvaged/rebuilt.

 

As far as designating the car as totaled, in the USA that determination is on a state-by-state basis. In New York State the figure is 75%. That is, if the cost to repair exceeds 75% of the "current fair market value" of the car then it's designated as a "total loss." Again, as I think I've mentioned, my body shop guy says there's no structural damage to the car, that it's completely fixable, and the reason for the "total loss" designation is solely the high price of the parts â at least as calculated by the insurance company's adjuster.

 

To summarize the main points here â the insurance adjuster's estimate did exceed that 75% threshold, so they want to pay us the market value minus the deductible and salvage value, and have us re-title the car as salvaged. Now I find out my body shop guy can do the job for about 65% of the insurance co.'s valuation, which obviously is below the 75% threshold â so I say the car should not be declared totaled. Only I'm afraid to bring this fact up to the insurance co. for fear it will trigger events that may lead to us getting screwed over somehow!

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That's interesting to hear. Was this a while ago? Did the insurance company make you re-title the car as "rebuilt", and did it affect your rates or coverage? I read that most insurance companies don't like insuring "rebuilt" cars as they are riskier.
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Don't you have the title, how can they decide what to do with it. So if they're able to retitle it no

matter who is in possession of it may be you'll have to point them in the direction of you repair

company. Talk to your repair company, they probably know how to deal with your insurance

situation so that you come out on top in the end, I wouldn't be giving any financial info out to

them either.

Triton Extreme 76, Kawai ES3, GEM-RPX, HX3/Drawbar control, MSI Z97

MPower/4790K, Lynx Aurora 8/MADI/AES16e, OP-X PRO, Ptec, Komplete.

Ashley MX-206. future MOTU M64 RME Digiface Dante for Mon./net

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That's interesting to hear. Was this a while ago? Did the insurance company make you re-title the car as "rebuilt", and did it affect your rates or coverage? I read that most insurance companies don't like insuring "rebuilt" cars as they are riskier.

 

The car was not retitled, but my rates did go up for awhile. State Farm was the insurance company. This was 10-15 years ago maybe.

Moe

---

 

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Don't you have the title, how can they decide what to do with it. So if they're able to retitle it no

matter who is in possession of it may be you'll have to point them in the direction of you repair

company. Talk to your repair company, they probably know how to deal with your insurance

situation so that you come out on top in the end, I wouldn't be giving any financial info out to

them either.

 

When a car is declared totaled and you accept the insurance company's settlement check, it's not your car anymore â so you're required to surrender the title. The insurance company does not "re-title" the car; they auction it to a scrap yard where it's harvested for parts. At least that's how I understand it.

 

If I elect to keep a car declared totaled by the insurance company then **I** have to get it re-titled, because the car is considered "rebuilt" or "salvaged" thus not legal to drive unless inspected by the state, where they certify that the repairs were done correctly. At that point I get a new title that says the car is "salvaged/rebuilt." This is all according to my state law â not insurance company practice. It can't be that different in Colorado but maybe it is?

 

You understand why I would like to keep this as a "regular" insurance job â i.e., I pay my deductible, they pay the balance of the repair bill to my shop, we walk away with a fixed car and keep the original title!

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Ok, as you explain, it's either get some money have it repaired but end up with a salvage/rebuilt title,

or have the insurance get it repaired by your company get nothing and end up with a clear title. Will you

have it long enough to justify the title with lower premiums or not?

Triton Extreme 76, Kawai ES3, GEM-RPX, HX3/Drawbar control, MSI Z97

MPower/4790K, Lynx Aurora 8/MADI/AES16e, OP-X PRO, Ptec, Komplete.

Ashley MX-206. future MOTU M64 RME Digiface Dante for Mon./net

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my 2000 Dodge Dakota has 108 K. I don't like to drive any

more, too many others, too many idiots, too many punks.

Triton Extreme 76, Kawai ES3, GEM-RPX, HX3/Drawbar control, MSI Z97

MPower/4790K, Lynx Aurora 8/MADI/AES16e, OP-X PRO, Ptec, Komplete.

Ashley MX-206. future MOTU M64 RME Digiface Dante for Mon./net

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