How to Get the Most Money from Insurance for Totaled Car

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How to Get the Most Money from Insurance for Totaled Car

Getting into a car accident is always inconvenient, but knowing how to get the most money from insurance for a totaled car doesn’t have to be so difficult. Even when the repairs are minor, your insurance company pays for them. However, getting into an accident that totals your car will often cause a major inconvenience for you and your family as you navigate the insurance process and try to find comparable vehicles to help you have access to your daily life.

An insurance company unwilling to pay your vehicle’s actual cash value can further complicate this. This article addresses this complication by making speaking with the car insurance company about your totaled vehicle more approachable and helping you get the most money from your insurance provider.

Typical Insurance Process After a Car Accident

After your vehicle is damaged in a car accident, your insurance carrier will typically send an insurance adjuster to look at your car and determine how badly damaged the vehicle is. Insurance companies determine what they believe is a reasonable price for the repair cost and what your car’s actual cash value is. They weigh the cost of repairs, vehicle value, and collision coverage limits to determine what they believe is a fair insurance payout for the repair costs.

However, when the repairs cost more than the vehicle’s actual cash value, you have a totaled car, and replacing the car will often be more cost-effective. However, if the insurance company undervalued your vehicle, you may not collect enough money from insurance to pay for a replacement.

Once the insurance company pays your claim, they will send the car to a salvage yard, where it will be assigned a salvage value. Other people will bid on it to use for parts, and the insurance companies keep the money they get in these auctions or from the auto yards.

Who Gets the Payout

When a vehicle requires repairs and a car insurance company is paying out an amount, it is helpful to understand who will receive the money from insurance. If you are leasing your car when the accident occurs, the money will likely go to the leasing company to help them replace the car or offset repair costs. If you have a financed vehicle, the money will first be used to pay off the remaining financing amount so that you will receive the vehicle’s value minus the amount owed on the loan. Finally, if you own your car outright, you will receive the total value of your vehicle unless a personal injury case is in play.

Reasons not to Accept the Insurance Company’s Offer

When you get the offer from the insurance company, you may need to accept the amount to replace the vehicle quickly; however, this offer is usually lower than what your car is worth if the insurance adjuster has fully accounted for your vehicle’s features. An insurance claim will often try to pay the vehicle’s market value without accounting for the unique characteristics that may have shifted the vehicle’s worth. If you believe the settlement amount you are being offered is too low, you may choose to participate in a total loss settlement negotiation with your insurance company.

Tips for Negotiating with Your Insurance Company

When negotiating with your insurance company for a totaled car, you may feel overwhelmed and want to give in to your insurance company to end the negotiation and replace your vehicle. However, using the tips below will help you prepare and execute a thorough negotiation with a claims adjuster and receive the best payout for the value of your car.

Research, Research, Research the Fair Market Value

One of the best things you can do is research to determine the fair value of your vehicle in its pre-accident condition. You could visit different used car yards and get an independent appraisal report to determine a reasonable value based on your vehicle’s safety, entertainment, and other features. By determining your car’s worth before the accident, you can have a good picture of a reasonable offer.

Evidence and Supporting Documentation

You will also want to gather as much evidence as possible to support your claim before negotiating. When your claims adjuster finishes the offer, they will often send you valuation reports or certified collateral corporation reports to back up the total repair cost exceeding the value and their evaluation of the car. It is important to keep both documents to help you in the process.

Other important documents are accident reports, especially if there is a question about the at-fault party in the accident, and maintenance records for the vehicle. These will help determine that you are a responsible driver and have taken good care of your car. All documentation will help increase the value.

You will also want to keep any evidence of your conversations with the insurance company, such as phone call logs and emails with the appropriate person, to document the entire settlement process.

Read Your Auto Insurance Policy

It would help if you also read your insurance policy several times to ensure that you understand how the company handles claims and determines payout amounts. This will help you find documentation and arguments that fit within their framework but support your claim.

Persistence

Insurance companies are often banking on you needing to replace a vehicle quickly and not wanting to take the time to deal with them for your payout. It will likely pay off if you persist with them and push them to consider your evidence.

Be Clear, but Smart

You may disclose your preferred settlement amount to your insurance company early on because it can help you set clear expectations for the process. It is also a good counteroffer to show that you are serious and want to continue speaking about the amount. When you present this with the supporting evidence and documentation, the insurance company must consider it when creating an alternative offer.

Ask for Management

Suppose you are dealing with a claims adjuster unwilling to work with you and refuses to acknowledge your evidence. In that case, it may be helpful to ask management to ensure that you are speaking with someone with the authority to negotiate with you.

Third-Party Appraisal

Finally, suppose you have not already gotten a third-party appraisal. In that case, it may be helpful to do so if your insurance company is not willing to consider your online research or other documentation. Sometimes, these services may cost money, so it is important to balance the cost with the benefit it may add.

Alternative Dispute Resolution

If you are getting nowhere with your insurance company, you may want to consider alternative dispute resolution (ADR). This could be mediation or arbitration, where a neutral third party either guides the negotiation or decides the case. You may need to check whether your policy has ADR requirements or waivers.

When to Hire a Lawyer

If you cannot resolve the dispute with your car insurance company, you may need to consider hiring an attorney to help you get the most money out of your policy. This is especially true if there is a personal injury claim where the courts must determine who the at-fault party or driver was. When the courts determine the at-fault party, the property damage is typically assigned to that person’s insurance, and they must cover some of the costs for the other party. These complicated cases will often require an attorney’s skills to support you.

Conclusion

Whether you have a totaled car or are disputing with an insurance adjuster about the amount of money you should receive for repairs, it may be a good option to push back on your car insurance company and ask them to pay for your new car. After all, part of having insurance is to ensure you have a vehicle to get you where you need to go, and if a payout will not help you get there, it is likely worth putting in the effort to ensure you can get to the next stop.

Contact ADR Times today to learn more about how to get the most money from insurance for a totaled car, insurance adjusters, negotiation tactics, and more!

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Emily Holland
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