Wrecked Your Car? How To Get Fair Compensation

Posted on Dec 9th 2009, 03:52 pm, under Are You Covered?

Let's say you were involved in a serious accident that left your car a complete wreck. After taking care of your health concerns, the next thing you want is fair compensation for your car. The car is formally called a "total loss" if the damage is irreparable, or if it's worth less than the cost of repairs. 

Before accepting total loss compensation from your insurance company, both you and your insurance provider must agree upon what your old car is worth. Sometimes, however, their assessment won't meet your expectations, and you'll have to bargain with them. Here's how you negotiate a total loss claim:

1. Keep in mind that it is your right to negotiate for and receive fair compensation. You want an amount that's enough to buy a car of similar year and model and roughly the same condition as your old car before it got wrecked.

2. Never accept your insurance company's offer for compensation without doing your own research first. Ask them to give you a copy of their own report and calculation, with a breakdown of how they came up with that amount, if possible. Don't start any negotiations with your insurance provider if you don't have any information yet. If you don't know exactly what your insurance plan covers, make it a point to find out.

3. Search online and get the sale value for a car model that's exactly the same as your old car. Make sure it's identical in all relevant aspects, including the year, model, make, and features. Most likely, you'll get varying prices, so get the average of everything you find.

4. Next, get the trade-in value for your car in its current state. You can easily find this out by checking it at Kelley Blue Book. However, though this is an important piece of information for strengthening your claim, you must keep in mind that insurance companies are not required by law to offer you the stated Blue Book value for your car.

5. If your car had any special features or add-ons (for example, new tires, low mileage, or heated seats), get the fair market value for a wrecked car of the same model and year, but without the extra features. Make a price comparison between these two. Tell your insurance provider of these features as well.

6. Use all of the information above when asking your insurance company for a higher compensation amount. If they won't budge, consider getting professional help. You may ask an independent arbitrator or attorney for assistance, but be aware that both these measures will cost you more money, so weigh the benefits against these first.