Now that we have covered the meaning behind the term “total loss,” it is time to dive into the impact a total loss will have on your wallet. As discussed previously, when a vehicle is deemed a total loss, the at-fault driver’s insurance no longer has an obligation to repair your vehicle. Instead they must pay you the pre-accident cash value of your vehicle.
If you have been involved in a total loss accident before, then you know that figuring out the actual cash value of your vehicle is not always a simple process. In fact, one of the most common reasons for an accident victim to seek out a car accident attorney is because the insurance company has valued their vehicle for significantly less than excepted. How does this happen? Shouldn’t finding out the value of your vehicle be as easy as going online and searching?
The North Carolina Administrative Codes (11 NCAC 04 .0418) provide some guidance on how to proceed if you think the insurance company is offering you a raw deal:
“If the insurer and the claimant are initially unable to reach an agreement as to the value of the vehicle, the insurer shall base any further settlement offer not only on published regional average values of similar vehicles, but also on the value of the vehicle in the local market. Local market value shall be determined by using either the local market price of a comparable vehicle or, if no comparable vehicle can be found, quotations from at least two qualified dealers within the local market area. Additionally, if the claimant represents that the vehicle actually owned by him was in better than average condition, the insurer shall give due consideration to the condition of the claimant’s vehicle prior to the accident.”
There are two main takeaways from this section. First, the value of the vehicle in the local market is controlling – not just published regional averages. In order to figure out the value of your vehicle, you must look to the local market price of a similar vehicle. So, if you live in an area where a cars tend to be more expensive than regional or national averages, you may be entitled to more money than a person living in a different part of the country.
The second takeaway here is that the insurer must give due consideration to the condition of your vehicle prior the accident. If you have done work on your vehicle that raises the value (this does not include general maintenance), you have a right to receive compensation that takes the increased value into account. Therefore, if you upgrade your car’s sound system, add a spoiler, or get a special paint job, then you should generally be getting a better offer than someone with the stock version of the same car. However, if you do not have documentation verifying the amount of you spent upgrading the vehicle, you may have difficulty getting full compensation for the upgrades. Make sure you save any and all receipts or invoices for parts bought and work done because that gives your personal injury attorney the evidence he or she needs to get your vehicle valued correctly.
Unfortunately, the pre-accident condition of a car does not always have the impact one might expect. For example, let us say that you recently got into a pretty serious car wreck, and the insurance company has told your car accident lawyer that your vehicle is totaled. You give your attorney some receipts for the tires you just bought and an invoice showing that you recently have some maintenance done on the car. You are expecting this to raise the value of your car, but you are instead being told that it does not have a positive effect on the value. How can this be? Routine maintenance maintains the value. In order to increase the value, whatever work being done must be above or better than the “routine”. Brand new tires may add a bit a value, especially if the tires serve a special function or are higher-than-normal quality, but routine maintenance generally does not increase the value.
Even armed with this knowledge, the insurance company may still be trying to get you to accept a low ball offer on your vehicle. The unfortunately reality is that the insurance companies know that it is very difficult for a lay person to assert their right to fair compensation. If you find yourself being given a crummy offer on your total loss vehicle, then it may be time for you to get a lawyer than specializes in car accidents. Having an experienced personal injury lawyer can make a world of difference when it comes time to demand a fair valuation on your total loss or bodily injury claim, so pick up the phone and call the Law Offices of Brain deBrun today. With over 50 years of combined experience resolving car accident claims, Brian deBrun and his associates know what it takes to get even the toughest claims resolved.
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