What About My Car?
An important part of recovering after a motor vehicle accident is getting you back on the road. When you are injured, it may be difficult to think about fixing your car, but it is an important aspect of your claim. The following is some of the information you may need to handle the property damage portion of your insurance claim.
Photos
The first step to resolving your property damage claim will also affect your personal injury claim. If you can, Take Pictures. As they say, a picture is worth a thousand words. Those photographs could be very important for settling your claim and giving proof of the magnitude of the accident.
Insurance
When another person causes an accident, generally that person's insurance company will cover all the costs associated with your property damage claim. If you have the appropriate insurance coverage, sometimes you may be required to use it to cover the costs associated with your property damage claim. A property damage claim can be resolved in one of two ways: (1) the vehicle is repaired or (2) the vehicle is determined a total loss (the cost of repairs exceeds the actual value of the vehicle). In the case of a total loss, the Fair Market Value (FMV) of the vehicle is determined and offered in settlement of the property damage claim.
Your Duty to Keep Down Costs
In Arizona, you have what is referred to as a Duty to Mitigate Damages. This means that you need to avoid any unnecessary costs/expenses associated with your damaged vehicle. For instance, if your vehicle has been towed and is at an impound yard, you need to have it removed as soon as you can so that you don't continue to incur storage charges. If the insurance company feels, or a court finds that you did or failed to do something and it cost more than it should have, you may not be able to recover for the money you could have saved.
Setting Up the Claim
You will need to setup the property damage claim with either the insurance carrier of the driver who was at fault or your own insurance carrier. Sometimes you will need to involve your own insurance if you maintain collision and/or rental car coverage. If the at-fault driver's insurance company has accepted liability, the property damage claim can be set up through that insurance company. If you carry collision coverage on your own policy and the at-fault driver's insurance company has not accepted liability, it is usually faster, easier and more convenient to have your own insurance company process your property damage claim. When accessing your collision coverage, in most cases you will be subject to paying your collision deductible. If the at-fault driver is uninsured, you will need to use your own collision coverage and you will be subject to paying your deductible.
Getting Your Car FixedThe insurance company normally has the sole option to either have your vehicle repaired. It is usually a question of cost efficiency. If the cost of repairs is less than the Fair Market Value (FMV) of the vehicle, they will repair it. If the Fair Market Value of the vehicle is less than the cost of the repairs, it will be considered a “Total Loss”.
Repairs
If the insurance company decides to repair the vehicle, you have the right to decide where the repairs will be performed. Most insurance companies will evaluate the cost of repairing your vehicle separately and independently from any repair shop. Be sure to give the repair facility the estimate generated by the insurance company and that repair facility agrees to repair your vehicle for the estimated amount. The insurance company will then work with the repair shop of your choice to get the vehicle repaired. If the estimate is unrealistic, and you cannot get another repair facility to perform the necessary repairs for the estimated amount the insurance company provides, you may obtain more than the insurance company’s estimate by taking your vehicle to several different repair facilities and getting written estimates from each. Present those estimates to the insurance company.
Should your vehicle require repairs that were not included in the original estimate, but that were caused by the accident, the repair facility will need to supplement the estimate and submit it to the insurance company for approval and authority to perform those repairs. In most cases, the repair facility will deal directly with the insurance company for supplemental repairs and it will not require your intervention.
Sometimes, the insurance company will claim that some damage to your vehicle existed before the car accident. Similarly, accidents often generate mechanical malfunctions. It can be difficult to determine if a mechanical problem was caused by the wreck or by normal wear and tear. Therefore, it is important that you prove the connection between the car accident and the damage you are claiming. Ordinarily, mechanics and body repair persons can help you determine the age of body damage or the cause of a mechanical failure. They can help you convince the insurance company that the car accident caused the damage.
The insurance company is not legally required to repair your vehicle with brand new parts unless your vehicle was brand new. The mechanic may use refurbished or reconditioned parts of a “like kind and quality” to return your vehicle to the condition it was in before the accident. However, you have the right to demand original manufacturer parts rather than a generic brand.
Be sure to carefully inspect your vehicle when the repairs are completed to ensure your vehicle has been returned to its pre-accident condition before signing any insurance company check or property damage release, otherwise, you may waive your right to further accident-related repairs.
Total Loss
If the cost of repair is greater than the Fair Market Value of the vehicle, the insurance company will declare the vehicle a total loss and offer you the Fair Market Value (FMV) [also called the Actual Cash Value (ACV)] for the vehicle.
In determining the FMV, most insurance companies use computerized searches, which take into account vehicles closely similar to yours that are advertised in local newspapers by private owners and evaluations done by local dealerships. Generally, the insurance company is trying to determine what your car was worth immediately before the accident. Once the insurance company makes a total loss offer, it is up to you to either accept the offer, or provide your own evidence as to why the vehicle is worth more. You are also entitled to recover prorated licensing fees on the balance remaining on the annual license and sales tax on the total loss value.
When an older vehicle is involved in an accident, it is hard to recover the cost of recent repairs. Normally, new tires or a new engine only slightly increases the value of a vehicle. If you have receipts for any improvements be sure to give copies to the insurance company as this could result in a better offer. Scheduled maintenance, oil changes and common repairs will not normally increase the value of your vehicle.
The FMV does not increase if you are "upside down" on your vehicle loan. You are "upside down" on the loan for your car when you owe more money than its fair market value or what the vehicle is actually worth. The insurance company only needs to pay the FMV of your vehicle. If you owe more than the FMV, you will be responsible for the difference. If this is the case, you may want to ask your finance company if they might be willing to "roll over" the balance into a new loan for a new vehicle. An insurance company is not responsible for an outstanding loan or lease balance in excess of the fair market value. So, if you bought a vehicle and were making monthly payments, you may unfortunately owe more than what the vehicle is actually worth. You will not be entitled to recover compensation for the loan balance if the vehicle is worth less.
When you agree to a "total loss" settlement, the insurance company buys your vehicle. If you wish to keep the wrecked vehicle, you may purchase it back from the insurance company for its salvage value. The adjuster can deduct the salvage value from the total loss settlement and you can keep the vehicle. In other words, they will pay you the FMV of the vehicle minus the salvage value.
When the registered owner wishes to retain the vehicle, a Salvage Title (for an inoperable vehicle) or both a Salvage Title and a Restored Salvage Title (for an operable vehicle, or a vehicle which has been restored to an operable condition) must be obtained and sent to the adjuster before the insurance company will settle the total loss claim or the vehicle can be disposed of. These documents are obtained and issued by the Department of Motor Vehicles and help to ensure that any future buyers of the vehicle are made aware that the vehicle was once declared a total loss.
To obtain a Salvage Title on a vehicle that is not operable or not going to be driven, the registered owner takes the following items to the Department of Motor Vehicles:
- A properly endorsed vehicle' s title;
- A lien release from the lien holder listed on the title (if necessary);
- The vehicle's registration documentation;
- Your photo identification;
- The vehicle's license plates.
- The owner must supply a notarized statement stating that the plates were lost or stolen if the plates are missing; and - The appropriate fee.
Once the vehicle is restored to an operable condition, the registered owner obtains a temporary operating permit. This allows you to operate the vehicle and bring it to the Department of Motor Vehicles. The vehicle will then be physically inspected to confirm it is roadworthy before the actual Restored Salvage Title is issued.
Rental Car
While your car is not driveable, the insurance company for the person who caused the accident is required to pay for a rental vehicle. If you caused the car accident, or there is not another person to blame, you must look to your own insurance policy to determine if rental coverage is available. Many insurance contracts do not provide rental coverage for their own customers. The insurance company will likely not pay for additional insurance if you purchase it from the car rental company. Your own insurance carrier should cover you while driving the rental car. Call your insurance agent to be sure you are covered while driving the rental car. If you do not have collision coverage, you probably will be required to pay for additional insurance coverage [Collision Damage Waiver (CDW) or Liability Damage Waiver (LDW)] on the rental vehicle, usually between $8 - $12 per day. The insurance company is only required to put you back to where you were before the accident and if you did not have collision coverage before the accident, the insurance company is not required by law to provide it for you on the rental vehicle.
Also, the rental car agreement usually only covers one driver. You will have to pay extra charges for having family members drive the rental car while your car is being repaired.
The method of payment for the rental vehicle will vary depending on the insurance company's policy. Some will use the direct bill method, while other insurance companies will operate on a reimbursement policy. When the insurance company pays for the rental vehicle directly to the rental car company, this is the direct bill method. The reimbursement method means that you pay for the rental vehicle and then the insurance company reimburses you for the cost. The rental car company will usually require a credit card to insure payment for the rental vehicle. Insurance companies often receive discounts with car rental companies, so ask the adjuster handling your property damage claim where you should obtain the rental vehicle to avoid paying any unnecessary costs.
The rental vehicle needs to be returned in accordance with the insurance company's instructions. Failure to timely return the rental vehicle may result in non-reimbursable out-of-pocket rental expenses.
If there is a delay in obtaining a rental vehicle or a rental vehicle is not used, you may be entitled to compensation for the "loss of use" of your vehicle for each day you have been deprived of its use.
