What do you do if your vehicle has been totaled in a wreck? In my current series of posts I have been blogging about the ins and outs of how to settle a property damage claim in Georgia. Today I will get into the details of how to research the value of a vehicle that is a total loss.
What I say today has no relevance to you if your vehicle can be repaired. BUT - be mindful of the fact that sometimes a vehicle that an insurance company wants to declare a total loss may be repairable. Under some circumstances you (with the aid of a knowledgeably body shop) can persuade an insurance company to repair a badly damaged vehicle rather than total it. There may be reasons you would prefer to have your car or truck fixed. How to go about persuading an insurance company is a topic for another post - today I am focusing on situations where a vehicle is beyond any hope of repairs.
The insurance company, once it has determined that your vehicle is totaled, will make you an offer. That offer usually includes the fair market value (FMV) of your vehicle (before it was totaled) plus sales tax and tags. Determining FMV is a bit of a guessing game. FMV in this context means what a willing buyer would pay a willing seller for a vehicle like yours (before it was totaled). To determine FMV insurance companies use a variety of methods, most based on research of the used car/truck market in your area. They may gather used car/truck ads for comparable vehicles and average them to arrive at FMV for your vehicle. The databases most insurance companies use to calculate FMV are proprietary (meaning they own the rights to see them and you and I are not generally going to be allowed to).
When the insurance company makes you an offer ask them if you can see the paperwork that supports their determination of FMV. Sometimes they will share this with you. If not, ask a lot of questions about how they reached their number. Focus on whether they have included all your vehicle's options and accessories. If they have failed to include a custom sound system or new tires in their evaluation that can dramatically decrease the FMV calculation.
Once you know how the insurance company has arrived at its number - do your own research. For ballpark values, go to websites like Edmunds, Kelley Blue Book, AutoTrader, and the National Automobile Dealership Association (NADA). These sites will help you research used vehicle values.
More on this topic next time.
