Insurance valuation for totalled vehicle?

My Mom was involved in a car accident today (both drivers are OK!). Apparently the other driver was at fault and Mom thinks her car may be totaled. She called me to ask a few questions and one of them was what would be a fair payout if her car was totaled. So, as I believe there are a few folks working in the insurance business on the forum, I thought I'd ask where should I look for info on what is a reasonable value for her to accept in the insurance settlement? She would never purchase from a private owner so is it reasonable to look at dealer pricing for comps? How is KBB pricing? She lives in central Florida. Thanks for any advice...

NADA is a good place to start. Go to Craig's list and look at dealer only prices for the same YMM car.

The key here is to be ohnist with your self as to the condition of the car.

In reply to dean1484:

The problem with that is I haven't seen the car in 3 years...but it was garage kept and driven by a little old lady (literally) for about 4.5k miles a year and maintained by the dealer. No smoking, pets, etc. and usually just her in it, so I do believe her when she says it was in "excellent condition"...other than the fact that it probably only got driven more than 5 miles at a time once a month.

It is not what the car is worth, it is what you can get the insurance company to pay, they have logarithm they run, excellent condition does not count for much at all.

They lowballed me badly on my pristine, '98 Integra GSR sedan, paid me under $5000 when it was worth over $7000. Cars they used for comparison were clapped out POS junk, I saw the printout they used. In California you have 90 days to appeal this, so I did.It had 4 literally brand new tires, they gave me $12 credit for each $125 tire, no credit at all for all the maintenance stuff I had just done, new ignition system, distributor, ignitor, coil, everything. Had records of all the maintenance, motor and transmission oil, all of which would have been selling points if I were interested in selling it. It passed smog for whoever bought it from the insurance company before I got all my money from the insurance company. They ended up having to cut me another check for a few grand, and the car would not have been a total loss if they had valued it fairly at the outset. I landed in a Mazdaspeed Miata, and I am a ragtop guy anyway, so it worked out in the end. Still miss that Integra. It would have been a track whore by now

There are several attorneys that for about 1K or so will build a very solid case and argue it for you to the opposing insurance company. Going through it right now myself.

Having said that on a car that is as cheap as you are talking the offer might actually be reasonable or at least negotiable to reasonable.

You can look at dealers for comps, because private party sales aren't easily spotted. However, expect to get slightly less than dealer comps. Insurance owes you for cash value of the car, not the "reconditioning" fee, advertising fee and profit margin all built into the resale value of a dealer vehicle. It's actual cash value.

Sorry Toebra, but things like tires, distributor, coil, etc... really don't add a ton of value to the car. When a car is valued, it is expected that it has those items in working condition already. If they're all new, the vehicle can be valuated at above average or "excellent" condition, and it will add some value to the car. However, it won't be dollar for dollar what you spent, or even close. It never is, even with a private sale.

KBB is not used for insurance valuations. It's a dealers book. It might give you a ballpark, but not a true figure. 98% of insurance companies use one of two different valuation services (a vendor) who comes up with the vehicle value. It is based on market research, local comps, mileage, condition, etc.... Get that report, if it's wrong, be prepared to tell them why...and prove it. Can't tell you how many times I have people saying "My car is worth so much more". I'll ask for details and evidence, and the only response I get is "I just know it's worth more". Sorry, no.

Klayfish wrote: You can look at dealers for comps, because private party sales aren't easily spotted. However, expect to get slightly less than dealer comps. Insurance owes you for cash value of the car, not the "reconditioning" fee, advertising fee and profit margin all built into the resale value of a dealer vehicle. It's actual cash value.

Yes, the insurance owes the actual cash value, but wouldnt that be determined by the cost of replacing with a comparable vehicle?

Aren't all those things part of the replacement cost? Not trolling, just trying to understand.

If you are looking for comparable vehicles to determine value it doesn't make sense to remove costs for those items if rolled into the price.

If listed separately then that is a different shade of gray, but an arguement could be made that they are part of the "out the door" cost that would be paid for an equivalent vehicle, especially profit margin.

I understand what you're saying, but what is legally owed is the vehicles' cash value. A third parties profit and overhead costs are not part of the value of the actual vehicle which was totaled in the accident. The value is whatever it's cash sale value was at the moment the collision occurred. Like I said, when trying to find comparable vehicles to help determine cash value, it's hard to find a bunch of private sales. So dealer sale prices are often used as comparables, which can be somewhat apples to oranges, but it's the best you're going to find. Frankly, the insurance company will then err on the side of the customer and pay closer to dealer price. In other words, if I have a 2012 Honda Accord and valuation comes back at $12,000. Customer insists it's $14,000 and comes up with 6 samples that are just like theirs selling for $14,000 on dealer lots. I'll look at the comps pulled up on the valuation report, then do some research on Autotrader, Cars.com, etc...to see what's out there. If I can find no comps selling for even close to the $12,000 in our valuation, I'll flex and come up with a compromise settlement. That's pretty rare, but it happens from time to time. It's not an exact science.

Klayfish give excellent advice from inside the industry. I am outside the industry and I'll give a layman's perspective.

Soon, the Insurance company may throw you a number/value. You want to be prepared for, "is that a good valuation or not?"

To answer that and to prepare yourself, I suggest you go shopping online now. Open up autotrader and cars.com. What your trying to answer is, "if I had to go out and buy the exact car today, what would that cost me or what would the price be?"

Be honest about condition and miles. Look for similar feature sets but really don't concern about color. You may now realize it will take $8k to "rebuy" what you had. Now, when the insurance company comes back with $7.8 - $8.2k you might feel satisfied that it is a good valuation.

If their valuation does not meet your expectations then be prepared with about 6 print outs of these ads justifying your higher valuation.

Had this very question answered on this board a few years ago when my gf's car was totaled while parked. It had just had the transmission rebuilt one month previously.

It's difficult to quantify stuff like that, but in this case you make the case that "my car X with excellent maintenance records/new and expensive maintenance" would be worth more than a similar X without those records or parts. Which is true.

Here's that thread.

Haggling with the insurance company

secretariata wrote: In reply to dean1484: The problem with that is I haven't seen the car in 3 years...but it was garage kept and driven by a little old lady (literally) for about 4.5k miles a year and maintained by the dealer. No smoking, pets, etc. and usually just her in it, so I do believe her when she says it was in "excellent condition"...other than the fact that it probably only got driven more than 5 miles at a time once a month.

I’m glad your mom wasn’t hurt and I don’t want to derail the discussion from what’s important to you but I’m a math Nazi, I can’t help myself…4,500 miles per year (top line) is a whopping 75 times more than 60 miles per year (bottom line).

Sorry, I’ll get out of the way now.

When my 2011 Fiesta got totaled I was expecting trade in value of around 9K, I was pleasantly surprised when the they said 12.5K. They said they checked the sale of about 20 cars. Made a nice down payment on my '13.

Yep, have your equal cars printed out ahead of time and it's an easy process. When my 91 BRG (special edition) Miata was totaled 10 or 11 years ago, they tried to give me 3,800 for it (what a "regular" miata with those miles and condition was worth at the time). I had a few print outs, pointed out it was a limited edition with no rust and that re-buying the "same" car would cost ~5,500, and they offered 6. It was a pleasant and non-confrontational, but I was helped by the fact that there's only ever 6-10 of them for sale at one time in the country and I had current evidence to back up my claims.

When our 2000 GC got totaled out, the adjuster looked at the books and comps, looked the van over in detail, and moved her number up based on the above-average condition and low mileage. She also gave me a slightly prorated refund for the headliner I had put in it earlier in the year, and some other recent maintenance I had receipts for, and for the remaining 16+/- months I had left on the current registration. Other than the fact that I would rather have had the unwrecked van, I thought it was pretty fair.

RX Reven' wrote:

secretariata wrote: In reply to dean1484: The problem with that is I haven't seen the car in 3 years...but it was garage kept and driven by a little old lady (literally) for about 4.5k miles a year and maintained by the dealer. No smoking, pets, etc. and usually just her in it, so I do believe her when she says it was in "excellent condition"...other than the fact that it probably only got driven more than 5 miles at a time once a month.

I’m glad your mom wasn’t hurt and I don’t want to derail the discussion from what’s important to you but I’m a math Nazi, I can’t help myself…4,500 miles per year (top line) is a whopping 75 times more than 60 miles per year (bottom line). Sorry, I’ll get out of the way now.

The interpretation of 60 miles per month was not how that was intended. What I mean is that most of her trips are 5 miles or less. About once a month she goes out of town on a trip that is probably 60-70 miles one way, otherwise everything she needs is within 5 miles of her house...

Thanks for the input folks.

So, I'm trying to figure out how to explain that she probably won't get what it would cost to buy an equivalent replacement, although I sorta feel like she should. I mean if there wasn't a wreck caused by the other driver she wouldn't need to spend any money...so to some degree I think their insurance should pay all costs to provide an equivalent replacement including fees, taxes, tags, etc.

Hardest part is I'm not close enough to handle it for her. She isn't very "confrontational" and probably won't push back very hard if the offer is low.

When my jag was totaled the biggest issue I ran in to was who was going to pay for the FTC on the rental. Be carful if you are told that your insurance covers you in a rental make sure you check with your carrier. Mine did not. Also they will try to say your credit card will cover you. Again check with the card issuer. The people at enterprise tried to sell me all of this but I knew better. So I went after the insurance company for it and the said yes it was covered then later tried to stick me with the bill. I had copy's of all the emails with them agreeing to pay and that plus a call from my lawyer made them go away.

The actual payout on the car was ok. But the complete CF with the rental really pissed me off. Bunch of idiots. You would think that they would know this but they were all completely incompetent.

psteav wrote: It's difficult to quantify stuff like that, but in this case you make the case that "my car X with excellent maintenance records/new and expensive maintenance" would be worth more than a similar X without those records or parts. Which is true.

It is true. You can bet your ass I would be willing to pay more for a car with brand new tires that I know I would not have to do anything but put gas in it and change the oil for another 100,000 miles. You could take that and a dollar and get yourself a cheeseburger at McDonalds

They have a computer program they ran to value my car, Collossus or something like that. It looked at other 1998 GSRs, none in the same state, none in as good a condition. I got to see the printout with pictures and everything. They had comps in there that were not sedans, with things missing from the interior, bad paint, rust, not really comparable condition at all.

When the boozejockey ran a stop sign going 50 mph in a residential area, it did this His insurance company tried to screw me out of paying for my rental car. That did not fly at all.

Sorry to say, but that's not a 50mph impact...not unless they just barely clipped you. That's more along the lines of 20-25 I'd guess...a 50mph direct hit would have wiped the front of the car nearly off. The "computer program", which was likely called CCC, is market research driven, not a simple algorithm program. If you're talking about a '98 GSR sedan that was totaled fairly recently, it may be a struggle to find a whole bunch of comps. Not many are still around, and many that are still around are clapped out messes. So they try to pull the closest comps it can, and I'd bet you missed it, but they will then do their best to account for the differences between your car and the "comps". i.e. miles, condition, etc... It's often next to impossible to find an exact match to someone's car, so you have to draw the closest comparable you can.

A few points to clarify from things above. If the car is totaled, your mother will get tax, tags and registration. Think of it as the insurance company is "buying" the car and your mother is the seller. So they'll pay state taxes, etc... Before you get to worried about how to talk to her about it, wait to see what the offer is. I don't know what kind of car it is, but if it's a fairly common car, I'd be surprised if the offer is far off what dealer pricing is. If the car is selling for $6000 on dealer lots, it's not like they're going to offer you $3500. It would be more like $5500-$5600 or so.

As for insurance coverage on the rental, if you're going through the other insurance company, they don't owe to pay for the additional insurance coverage. Most of the time they won't pay for it. I don't allow it (business decisions and odd exceptions aside).

@ klayfish

Here MA they only pay Tax. No title and registration and they were firm on that. Don't know why and I did not press it as it was not a lot and there offer for my car fair.

My experience. The ins. co. bought my wrecked car paying sales tax and other expenses.

Then they sent me a check.

Klayfish said: I'd bet you missed it, but they will then do their best to account for the differences between your car and the "comps".

No, they did not do that. They would not even consider the fact that cars tend to go for more in California than they do in Arkansas. Have not shredded that file yet, because it took so long for the personal injury part of it to be resolved. I could scan it and show you, but what is the point of that? Happened in 2011, had the car 13.5 years. Like I said, I appealed it and they had to cut me a second check for over $2000. They paid about $5000 initially, so they low balled the value of the car by 40%.

The van that hit me looked like this. Barely touched me and spun my car 270* I estimate 50 mph based on what the Sheriff's Deputy that saw it happen said, and going back later to try and figure out how I never saw him until after he hit me. To cover the distance he did in the time it took me to look both ways, he had to be going at least 50 mph. He was going so fast that neither of us were sure what color it was, and it happened right in front of both of us. I said grey pickup, she said white van. He fled the scene and a witness chased him, forced them to the side of the road after he ran a redlight trying to escape, and told him he better go back.