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Thread: Anybody Totaled a Car and Got Close to Replacement $ back from Insurance?

  1. #1
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    Anybody Totaled a Car and Got Close to Replacement $ back from Insurance?

    With car prices so high, I'm concerned. I'm getting insurance quotes soon and may drop my collision coverage.
    Thanks
    "Whether you think you can, or you think you canít - youíre right."
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  2. #2
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    Used car values are always a bit variable. Kelly Blue Book can also be a bit tricky, since most people just look at the highest value, and it depends on whether you sell it yourself, or trade it in at the dealer. So with all that, your insurance company is probably going to try to get the best deal it can, which usually isn't as good for you. You can then argue a bit with them, but I wouldn't expect much.

    Personally I don't carry collision, but I also don't like insurance for relatively low values, and I drive old cars. Insurance to me should be about hitting the "jackpot", ie something that would otherwise be catastrophic, not little payouts.

  3. #3
    My one son who lives in Denver had a 2001 Honda CRV that I gifted to him, which had the catalytic converter stolen.

    The insurance paid for the replacement, 3 days later it was stolen again.

    They totaled his car, and I was shocked to learn they gave him $3500 for it, which was probably 3X what it was worth according to the book.

    With the replacement costs of vehicles now, I would have collision unless it was an out'n'out beater. Comprehensive covers more than collision, as in the catalytic converter theft, vandalism, cracked windshields, etc.

  4. #4
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    Book value for a car you own and retail value for the same car are never going to match even if you can find the exact same model car from any car dealer new or used. In a private sale you might get close.
    Lee Schierer
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  5. #5
    I believe most insurance companies use another company who does a "valuation" of your car - pre accident. They look at sales of cars of your model and year and do some adjustments. If you keep your car in excellent condition, you'll probably get shortchanged because they go on the "average" car of your model and age.

    Regarding dropping collision, the question is can you withstand the loss of the car? If you have an accident that's your fault, you will not get any payment. If the other person is at fault, their insurance company should pay you, but collecting can be a problem.

    We have two old cars (2005, 2007) and have dropped collision. The cars don't have a lot of value as used cars and I feel we can withstand the loss.

    Also, if you have an old car, even if the damage is minor, the insurance company will declare it a "total loss" and want to take your car. The cost to repair only has to be about half the blue book value for them to declare it a total loss - so even a minor "fender bender" can total loss your car (you would be amazed at how much it costs to repair a fender these days). If you refuse to let them take the car (which is your right), you get a reduced payment for the damage and you have to deal with a "salvage title" on the car. If you don't carry collision, you can do what you want with the damaged car - you can pay to fix it, or sell it to a salvage yard. If you pay to fix it you don't have to deal with the salvage title problem.

    Getting a salvage title in California is a challenge, and after you get it, it seriously reduces what you'll get for the car when you go to sell it.

    Mike

    [The reason you purchase insurance is to protect yourself from debilitating loss. For example, you purchase insurance on your home because if it was destroyed you'd have a life changing loss. You carry collision insurance on your new car because if it was totaled in an accident, you'd have a serious financial loss. Once you can stand the loss - when your car gets old and is worth only a few thousand dollars - it's not unreasonable to drop collision insurance. Carrying collision on an old car can be a losing proposition because the insurance company will just declare it a total loss, even if it is repairable at a reasonable price.]
    Last edited by Mike Henderson; 06-06-2022 at 12:54 PM.
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  6. #6
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    My son's used car was totaled (by someone who ran a red light and died in the wreck, son didn't have a scratch) and he got back more than he paid for the car, enough to buy a newer model.

    I have argued with an insurance company about a motorcycle (hit by someone pulling out in front, friend using it broke his leg). It was the other guy's insurance and they made an offer, I rejected, after some "discussion" they met what I thought was reasonable.

    I have also found that good written documentation might help when a wreck is another person's fault. When a guy fell asleep at 2am and clipped a power pole, his insurance company was initially not agreeable to paying any of the $6000 repair bill on my vehicle. (a very exciting few seconds, I had five in the car, fortunately no one was hurt.) I provided six pages of printed documentation, complete with diagrams, photos, and witness statements and they decided to pay. I happened to be wearing a suit when I delivered the document, on my way to a wedding or something. The agent told me later he thought I was a lawyer.

    JKJ

  7. #7
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    Quote Originally Posted by Robert Engel View Post
    With the replacement costs of vehicles now, I would have collision unless it was an out'n'out beater. Comprehensive covers more than collision, as in the catalytic converter theft, vandalism, cracked windshields, etc.
    Sure, but it's not cheap. Let's be really clear about what insurance is, it's a form of risk management* and the people selling the insurance come out ahead by design. (I'm hesitant to call it outright gambling, though it has it's roots in the gambling houses of Europe) The issue with all these additional "services" that are covered is that the rates go up, and so you really don't come out ahead, IMHO. Also depending on the converter that would be enough to total my cars, neither of which I'd consider an out n out beater, but they are pretty old (2003 and 2006). There are a lot of variables, but usually a few months of premiums would be enough to pay for these services, since the insurance companies know they're much more likely to payout for them.

    Also I should be honest and say that I'm likely to do my own work, which makes a lot of these lesser problems potentially even cheaper. Given this is a DIY forum, I'd guess people here are more likely to do their own work than other places.

  8. #8
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    There was a time when it was more common for folks to drop collision coverage on older vehicles. It's not as popular anymore I suspect because of both the cost of repair and the cost of replacement. So much of the repair scenario involves assemblies rather than just parts and that impacts repair costs, too. Personally, I don't drop the coverage, but we rarely will keep something more than about seven years, too.
    --

    The most expensive tool is the one you buy "cheaply" and often...

  9. #9
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    Quote Originally Posted by Mike Henderson View Post
    Also, if you have an old car, even if the damage is minor, the insurance company will declare it a "total loss" and want to take your car. The cost to repair only has to be about half the blue book value for them to declare it a total loss - so even a minor "fender bender" can total loss your car (you would be amazed at how much it costs to repair a fender these days). If you refuse to let them take the car (which is your right), you get a reduced payment for the damage and you have to deal with a "salvage title" on the car.
    How does the car end up with a salvage title if you don't let the insurance company take it? There is no change of title in that scenario.
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  10. #10
    Quote Originally Posted by Lee DeRaud View Post
    How does the car end up with a salvage title if you don't let the insurance company take it? There is no change of title in that scenario.
    I wish that was true, Lee. What happens is that the insurance company informs the DMV that they have declared the vehicle a "total loss". If you keep the vehicle, you get it repaired and then you have to go to a company that is licensed to inspect the vehicle for lights and brakes (about $150). Then you take your vehicle to the DMV, with your old title, the inspection report, and they inspect it. If all is okay, they issue you a "salvage title" and you can keep using the vehicle legally.

    If you give the vehicle up, the salvage company auctions the car off. Then the buyer can repair the car and go through the same DMV procedure to get a salvage title.

    The thing that initiates all this is the insurance company reporting that the vehicle is a "total loss". And the repair cost only has to be about half the blue book value for them to declare it a "total loss'.

    Don't ask me how I know this. It's a pain.

    Mike

    [That's why I dropped the collision insurance. If I have an accident, the insurance company is out of the loop and does not report the vehicle as a "Total loss". I can get it repaired (if I want to) and there's no salvage title. If I sell it to someone else, they can repair the vehicle and there's no salvage title. If it really is a "total loss" I can sell the wreck to a salvage company.]
    Last edited by Mike Henderson; 06-06-2022 at 11:41 PM.
    Go into the world and do well. But more importantly, go into the world and do good.

  11. #11
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    Quote Originally Posted by John K Jordan View Post
    My son's used car was totaled (by someone who ran a red light and died in the wreck, son didn't have a scratch) and he got back more than he paid for the car, enough to buy a newer model.

    I have argued with an insurance company about a motorcycle (hit by someone pulling out in front, friend using it broke his leg). It was the other guy's insurance and they made an offer, I rejected, after some "discussion" they met what I thought was reasonable.

    I have also found that good written documentation might help when a wreck is another person's fault. When a guy fell asleep at 2am and clipped a power pole, his insurance company was initially not agreeable to paying any of the $6000 repair bill on my vehicle. (a very exciting few seconds, I had five in the car, fortunately no one was hurt.) I provided six pages of printed documentation, complete with diagrams, photos, and witness statements and they decided to pay. I happened to be wearing a suit when I delivered the document, on my way to a wedding or something. The agent told me later he thought I was a lawyer.

    JKJ
    A few years ago, my daughter was backing out of angled parking in a parking lot, when she got clipped by an unlicensed (but the vehicle was insured) driver going the wrong way, and way too fast. The cops wouldn’t let the other driver leave in the car until someone with a license could drive it away. Anyway, the other insurance company was a rag-tag operation out of Illinois, and kept dragging their feet on the $700 that it would cost to fix my daughter’s bumper (which we had no intention of having a shop fix—my son jerry-rigged it back on), which was about 1/3 of what we paid for that car. Finally, I wrote a neat, little, formal letter to that company that included something along the lines of, “I’d hate to have to get a lawyer involved, as your costs will go up significantly.” The check arrived a few days later.
    Jason

    "Don't get stuck on stupid." --Lt. Gen. Russel Honore


  12. #12
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    My daughter recently totaled her car (#3? I'm trying to forget-- no one hurt in any of the instances), insurance (in CO) paid out about $5K more than she paid for the car a year earlier. She complained about how long it was taking and they gave her $500 of Uber credits to use. This is not how I grew up thinking about insurance companies.

    Looking at the used market she should readily find a similar replacement with the payout. I think the high price of used cars has also increased the value of the wrecks. Someone will fix her car and resell at a tidy profit, no doubt.

  13. #13
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    December of 2021 wife and I t-boned a guy who ran a stop sign. 2015 Ford Mustang 110,000 miles, v-6, automatic got around 20k for it after arguing with our insurance company who claimed it could be replaced for that. Could not be replaced for less than 22-24k, however wife wanted a SUV, so settled. Guy had General Ins, who has refused to pay anything claiming he was delivering for Door Dash. So far, my company has been paying for car and medical, do have a lawyer working on this case. Will see how long it takes and how it turns out.
    Definitely advise all to have uninsured/underinsured protection, property and bodily injury, on all of your vehicles
    Ron

  14. #14
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    I crashed my girlfriends Dads new Volvo on a snowy morning in Ithaca NY. The Insurance company proceeded to try to steal the car from him. They insisted it was totaled and offered a very low pay out. He had a huge struggle getting a second opinion and estimates. He did finally get his car back and paid the deductible plus some.
    Best Regards, Maurice

  15. #15
    Quote Originally Posted by Maurice Mcmurry View Post
    ... The Insurance company proceeded to try to steal the car from him. They insisted ...

    Reading thru this there seems to be a fairly strong consensus about the nature of insurance companies, so here's a bit more...

    I was rear-ended on an interstate in Sept. '21 - - I was at ~10mph, with walls or stopped traffic on each side, the lovely lady behind me was on cruise-control at 75mph ('failure to control sleep' per the TX DPS). Totaled my car (and the other one too). She was a bloody mess, and I was in Lala-land for a few minutes. DPS, Fire, EMS, ERs, .. the whole gang was there. She had Allstate Insurance for her car. I had Allstate Insurance on my home; they'll want to take care of a customer. Right? ....So we'll let Allstate Insurance handle this. Rrrriiiiiight!

    They offered a fairly quick and (IMHO) a fair settlement on my car - mostly to get me out a rental. Bravo! But they have now dragged the medical/lost time/etc settlement out for 9mo. The medical claims went to collection, so I finally paid them myself!! This has never been an issue with the $$ amount - just their sloth.

    USAA has provided my auto insurance since I got a license, and has bent over backwards for every claim I've ever had - no matter the fault.

    Allstate Insurance will never provide coverage for me for so much as a toothbrush.

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