by ezwaydesig » Tue May 10, 2011 12:27 am
Liberty Mutual is the insurance company of the driver that hit my car from the rear and they are taking full liability. They declared my 2007 Honda a total loss. Now they are offering me less than it will cost me to replace it with a like vehicle (similar low mileage - mine had 36400 on it). Accident took place in NJ
Posted: Tue May 10, 2011 12:44 am Post Subject:
A common misunderstanding about TOTAL LOSS is that you will receive money for a new vehicle. The insurance company is responsible to INDEMNIFY you -- to restore you to the condition you were in prior to the loss, but without any "profit".
Property claims such as yours are usually settled on the basis of ACTUAL CASH VALUE, which is the vehicle's replacement cost MINUS depreciation and any pre-collision damage/defects. If the damage to your vehicle exceeds 70%-80% of that amount (based on state law), the insurer will declare the vehicle a total loss and pay up to the statutory maximum.
If you can find a comparably equipped vehicle of the same year, make, and model, with similar mileage, you could press the insurance company to obtain that vehicle in satisfaction of your claim, since that would represent the principle of indemnity.
Don't let them bully you into accepting less than you believe you are entitled to, within the confines of your state's auto insurance laws. Insurance laws frequently use words such as "what a person would reasonably believe" when discussing claims practices. If you are being reasonable, there's no reason for them to bully you.
Posted: Wed May 11, 2011 01:09 am Post Subject: They came around
After fighting with Liberty Mutual on Friday, they decided to increase the fair market value on my car by $2300. I am now satisfied with the offer and will take the payment. Thanks for making me feel that I was justified in refusing to take their first offer.
Posted: Wed May 11, 2011 01:15 am Post Subject:
Good for you! Unfortunately, too many adjusters think they're doing the insurance company a favor by offering less than they really should, hoping the claimant will accept. When the claimant won't settle, then the give-and-take begins, and may the most stout-hearted person win. Some give up too soon.
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