You’ve been in a car accident that saw your car take damage and you’ve gotten the final say-so as to what happens to your car. The adjuster has been to see your car after the accident and has issued the verdict for the repair or disposal of your car and it’s not what you were expecting.
While your claim moved along, you decided to retain legal services because you felt the insurance company wasn’t playing fair with you on other details of your car accident settlement. You may very well be right in that the insurer was trying to get you to accept less money for your damages and for you to go away and bother it no longer.
Getting legal representation does put the insurer on notice that you’re going to negotiate your settlement, but the final disposition of your car may still wind up being out of your control.
What to Do When Your Car is Considered a Loss by the Insurer
You loved your car dearly. It got you where you needed to go and it ran well. But the adjuster for the insurance company isn’t going to see that when they evaluate your car.
The adjuster may be sympathetic, but she has a job to do and that’s making sure the insurance company pays out an amount it considers fair. If the amount needed to repair the damage to your car reaches a certain percent of its value, it’s going to get sent to the scrap yard no matter how hard you protest.
Now you’re without your car and the amount offered for its replacement is a bit insulting. It’s not enough to get you a car that was equivalent to the one you lost. However, the insurance company isn’t going to view it that way. It’s going to tell you that the amount offered is fair and in line with what you would get from a trade-in if you bought a new car.
What the insurer is ignoring is the fact that your car’s value was more than make, model, mileage, and condition. The car gave you a quality of life that you can’t achieve with the money they offer for a replacement. You can press the insurer for more money, but you may not get enough even if they increase the offer. You’re better off working with a lawyer who can negotiate for an amount that’s more in line with what you need to get back on the road.
Insurance Companies May Not Want to Play Fair With Your Settlement
Getting legal representation to help you get a better settlement for your car may feel like you’re going too far and dragging out the claim. You shouldn’t feel like you need to let the insurance company off the hook for not paying you a fair settlement.
Insurance companies are notorious for being cheap with settlements and will not hesitate to bring out their own legal department to make it harder for you to receive compensation that’s in line with the difficulties you’re dealing with. Why should you be without legal representation against a corporation who views you as a minor irritation? You’re better off finding a lawyer to advocate for you and negotiate on your behalf.
If you still owed money on your car, the insurance company probably won’t give you enough money for you to pay off the balance unless you have gap insurance. Gap insurance pays off the balance of your vehicle in an accident if it’s worth less than the amount of the loan.
And if you didn’t have gap insurance, you’re still required to pay off the remainder of the loan even though the car is totaled. It’s a bad position to be in because it hinders your ability to buy a replacement car. Legal representation increases your odds that you’ll be able to pay off the loan instead of being punished simply for not having enough insurance.
How Your Responsibility for Your Decisions Affects the Settlement Amount
The insurer is going to take a look at the details of the accident in order to determine who has the burden of fault. Said insurer will reduce the amount of the settlement offered to you because it was determined that you share in a percentage of the blame.
For example: you made a decision to pull out when you thought it was safe to do so, but got hit by a car that was obscured by a structure or a tree. The insurer will try to place blame on you for not doing a good enough job to make sure that the intersection was clear before pulling forward.
Or the insurer apportions 20 percent of the fault on you and 80 percent of the fault on the offending driver. This is going to lower the amount the insurance company offers you even though you feel you weren’t at fault for the accident.
While this is an example, you need to be aware of how an insurance company apportions blame in order to reduce the amount it pays out. Documentation from after the incident can help with reducing the amount of responsibility you’re given, but it’s a factor in the settlement regardless.
Should You Get the Car Fixed Instead of Letting the Insurance Company Total It?
It’s understandable that you’d want to get your car fixed as part of a settlement instead of it getting sent to the scrappers. But it probably won’t be worth it in the long run. To begin with, if an insurance company deems a car should be totaled, they have the law on their side.
All states have laws that require insurers to deem a car totaled and apply for a salvage title if the damage reaches a certain threshold.
The threshold, known as total loss formula, varies state by state. Some states have 100 percent while others are as low as 60 percent. A state that has 100 percent of total loss formula requires the insurer to determine the cost of repairs to exceed the value of the car.
States with lower percentages can make it seem like it takes very little damage to the car for the insurer to declare it totaled. When a car is deemed to be a complete loss, the insurer applies for a salvage title from the state’s licensing authority and sells the car to a scrap yard for disposal.
These laws exist to prevent fraud, remove unsafe vehicles from the road, and reduce the strain on insurance companies covering the replacement of the car.
Insurers can get a salvage title from the state even if there are outstanding payments owed on the car. It is better to let go of the car and give control of its destiny to the insurance company instead of trying to get it repaired. You also have to deal with the uncertainty of the repairs not restoring the car to its original operating condition in the event you can get the car back.
What you want out of a settlement is enough money to pay off an outstanding loan and have enough left over to put a down payment on a replacement vehicle. You can get back on the road in a car you know is safe and restore your quality of life.