Update on Car Insurance and coverages

[desoto1939]

I just came back from the AACA annual convention here in Philadelphia. i met with three of the Insurace carriers that write Insurance for our old cars, JC Taylot, Grundy and Haggerty.

 

Since one of our members had a claim with Haggerty and had the car values with a Guaranteed amount for 20K and then had an accident and the estimate came to be around 13XXX.00.  Haggety came back to the gentleman and told him that since the claim to fix the car is at 70% of the Guaranteed amount for the car  they were now going to total the car and list it as salvage.

 

Her is the explaination that was given to me.  Some states and not all have some real strange Insuracne coveage regulation.  And in this case the state that this gentleman lived in must have been one of those states. So this state has the 70% ruling that if the cost is more than 70% of the gauarnteed value then it is totaled and goes to salvage.

 

SO, Here is what is being suggested to anyone that, and I recommended that everyone contact their insurance carrier to get it verified that their individula state does not have this strange ruling.

 

So for this gentlman to get 20K of coverage he would had to have the car to valued at 30K so that the 21000 mark is the true value.

 

Check you insuracne plan and call you agents to be sure of the coverage on your car so you do not get caught with not having enought coverage on your car.

 

Rich Hartung

Desoto1939@aol.com  

 

[jcmiller]

But didn't the person with Haggarty insurance then get a check for the pre-wreck cash value of the car and perhaps an opportunity to keep the car?

[desoto1939]

yes he did.  But you are not getting the point that I am trying to make.

 

Here is Pa with the same situation the car would have been totally fixed and not have gone to salvage and there is no 70% reule.  each state has different rules and you alll need to know these rules.  We were all under the opinion that he should have received the 13xxxx.00 check to have the car fixed and not have the 70% ratio held against him.  So inorder to get the 20K of insurance he would of had to 30K on the car and that would have but the 70% ration or total salvage value at 21k.

 

Just verify how you state works and call your insuracne carrier to find out if your state has any wierd regulations  They are all not alike.

 

Buyer BEWARE of what you think you have in coverage.

 

Call me if you want me to explain in more detail. Philadelphia area - Valley Forge PA.

c 484-431-8157

h 610-630-9188

[Robert Horne]

All insurance companies do not play by the same rules.    Last year I bought an Explorer from a lady, that the insurance was paying

 

for a total loss, and the owner was given the choice to take the whole amount, or keep the vehicle and take a partial payment.

 

The owner let me have the Explorer for the partial amount, clear title, which was 15% of the whole amount.....

[jcmiller]

Hi Rich,

 

I think the point you are making is that you need to check the state regs and read the policy carefully, which is a great point to make.  I guess the thing I don't quite understand is the concern over that person's treatment.  I think I would be stoked to get a check for $20K and have a car that needs $13K in repairs, although I'm sure the customer would have to pay something to keep the totalled car.  How was the person harmed?  It seems like they can get the car fixed and have money left over.

 

Your suggested solution is creative, but I suspect the insurers would hesitate at writing a $30K policy for a $20K car.

 

The last few years I've spent quite a bit of time trying to get money from insurance companies, and I have a whole new perspective on it.  They are happy to collect money but can come up with 50 reasons not to pay out, and they have no problem spending twice as much fighting a claim as the claim was actually for.  I'll second your "buyer beware" warning.

 

Jeff

 

 

[BobT-47P15]

We seem to have the 70 percent rule in Missouri.  I watched the adjuster and talked to him when he was writing up the

damage claim on the convertible following the tornado.  I wanted to make sure he didn't reach that 70 percent mark. 

 

If they do declare a car a total, they usually offer  what they feel is the value of the car - then you can buy it back

for the salvage value = plus get paid  the remainder of the car value.  You can then take that remaining money and try to find

some cheaper shop to fix your car.  Usually estimates of repair come from the large shops and are on the high side.  

 

Usually the companies look at some published value figures like Old Car Price Guide or similar when you ask to insure the

car for a stated dollar value.  If you want to exceed that amount by much, they may not want to insure you.  So....you are

kind of darned if you do and if you don't.  In the final analysis, most companies are looking to come out in their own favor. 

 

So support your contention that your car is worth more than the average, you need to get a written

appraisal from a qualified shop itemizing things and assigning value.  Which they usually do for a

fee.  It could be money well spent at claim time. 

Edited February 9, 2013 by BobT-47P15

[austinsailor]

I'm still not clear what the message here is, other than you should read all the details.

 

It's my understanding that if you have agreed value insurance, and that if the car is totaled, they pay the agreed value.  If the car is insured at an agreed $20,000 and is declared totaled by whatever formula they use to determine that (70%, gut feel or whatever) they write a check to you for $20,000 and they get the car.

 

Now I understand there are ways to buy your wrecked car back from them and all, but I don't see where the $30,000 coverage fits in or why. I'm only commenting on agreed value policies, not your normal coverage, which seems to be what about half of the comments are concerning. Normal policies are a whole different animal and you get screwed in most of them.

 

There is probably an important message here that I'm missing. What am I not understanding?

[oldodge41]

I think I understand, If you want 20 thousand in "repairs" covered in 70% states you need to have 30 thousand in "total" coverage. It may keep you from ending up with a salvage or reconstructed title vehicle if you had to buy it back. Or maybe I am wrong too, let me know.

[Robert Horne]

If an insurance company in a "70%" rule state, has a damage claim of say 69% damage of a $20,000 policy, would the owner receive the 69% of the value, and keep the car?

If the damage claim of say 71% of a $20,000 policy, car would be "totaled", would the owner have the option of receiving the total value, $20,000, and the company keep the car, or would the owner have the option of keeping the car, (buy it back) for a reduced amount of money.

 

With my friend's Explorer insurance company, here in Virginia, the owner has the options.

 

With my my Mom's Allstate insurance claim, (Ohio) Allstate did not allow the owner the option.

The policy have very small print that says the insurance has the options...

 

Good to know if the owner  has the options or not....

[greg g]

I believe NY is a 70% state.  The reason for this rule is that States were finding that vehicles damaged to this extent, were being shabbily repaired and returned to the road in less than safe condition then ending up wrecked again causing more expense and injury.  So the Ins companies lobbied the stated for this situation.  they pay of the car, take title, then recoup part of their loss by selling the car for salvage or parts.  Then they can get the owner to buy a new car and foist of more expensive policy on the for covering their more expensive new car..  I have seen people actually ask for appraisers to find more damage or more expensive parts so they can get a newer vehicle.  So check with you state's insurance regulators and make sure you know where you stand.  In NY when you buy back your title, the car becomes salvage, and can only be titled that way and must go through a 200 dollar  (owners cost) inspection before it can be returned to the road.  And if and when it goes back on the road, not a lot of companies will issue insurance on a salvage title or if they do they will write the state minimum, ie. nothing but uninsured driver, and liability.

[austinsailor]

Sometimes it makes sense to get to the 70% point. My son wrecked my 1 year old F**d 4 wd pickup. It was damaged beyond anything I'd want, patched together or not. Wasn't to the70% point, though. I pointed out that it had heavy duty cooling (about a $40 or so option) and they found that radiator was $200 more. I pointed out it had limited slip front and rear, they had to allow more there for possibly damage. Several other things and - poof - I got a check for $400 less than I'd paid new. (I drove a pretty hard bargain when I ordered it).

Much better than a patched together truck with 40,000 miles on it.

The body shop told me once they passed the 70% (or whatever the exact number was) there was too much risk they'd find more damage as they did the work, and then it would possibly cost more to finish than it was worth. And, as others have pointed out, the un repaired vehicle does have some value as salvage parts.

Another fine point - in Texas, maybe others, they pay you the sales tax as part of your loss. Missouri, not so.

[desoto1939]

Part of the point is that our club member had his car insured for 20K. He was under the impression that they would fix the car if the extimate was under the 20K mark.  But since his state had the 70% run then they said to him that the cost to repair is more than the 70% mark so the car then goes to salvaged.

 

In some stated after the car goes to salvaged you have a very hard time reselling the car.

 

So what I am trying toget across is that he was expecting the car to be fixed because it was under the 20k mark and the car would have been still titles as a working car, but the 70% rule got him and he did not know about this rule. So for him to have kept the car from going to salvage he woulod have had to raise his policy to 30k to just cover the car for 21K at salvage value.

 

Basically, I am stating check and recheck your policy to see how it works for or against  you.  Again Buyer BEWARE of what you do not KNOW.

 

Just trying to get everyone to look at their policy and make sure they have the coverage that they think them have purchased.

 

Rich Hartung

Desoto1939@aol.com

[austinsailor]

Thanks, I'm a little slow sometimes but now I get it.

Gene

[Don Jordan]

I can't believe there would be two of us with the same problem so I am going to assume you're talking about me. Here's what happened:

First I have no problems with Hagerty. I was treated well and I believe fairly.

I smashed my own car. I felt so guilty I almost didn't report it. I didn't think it would cost so much to repair. I was blindsided by the body shop. I took the car in and I don't remember the exact number but they wanted about $20,000 to fix the car. My insurance agent said they couldn't cover that and would have to total the car. I said I couldn't do that. He said they would pay $13,000. I went back to the body shop and dickered with them. I went and bought a new fender and door. Got the stainless repaired. Interestingly they dropped the price to $12,400. Hagerty sent me a check and I paid for the work. They did an incredible job.

Hagerty told me they would have to total the car but I'm not sure what that means. They didn't send me any paper work - I still have the pink slip. I don't know what's going to happen. People have said it will affect the selling of the car but I never plan on selling it so it's moot.

I paid $100 a year and put the value at $20,000. I could have put a higher value on the car but I wasn't planning on screwing it up. It was a lesson learned. If it had been my daily driver (Mini Cooper) I wouldn't have cared but I've got a lot of emotion tied up in the Plymouth.

[desoto1939]

Don,

 

The question that I am trying to figure out is this you had 20K agreed valued. The cost origianlly was 20+k to fix. Yes then Hagerty will then total the car.

You then got the cost down to under 13K. Now hagerty is telling you they have to total the car again.  Why. If the cost is below the 14K mark which is the 70% value then they should have paid the claim in its entireity and the car should have not gone to salavage.  The question is did they payoff the entire 20K to you since they totaled it or just the cost of the repiar and then you had to buy the car as salvage.

 

Now the issue is that the car has a salvage title.  When and if you or your family ever go to sell the car it is much harder to resell the car because of the title.  I know you stated that you will not sell the car but things do chnage over time.  Not trying to  make this a major point.

 

What I am just trying to do is educate the club members and not at your expence but trying to take you situation so that noone else has the same issue.

 

Here in Pa. we do not have the 70% rule as in your state but some state have this and other odd rules.  So in my state if the car is covered for 20K then they will pay up to the 20k to fix and not totalthe car. When it goes over the 20k then the car is totaled and then take the car and then you can as to buy it for salvage.

 

Again not trying to single you out but just trying to educate the clun members.  If you have any more info to provide please do so we can all understand. I was not trying to use you name but knew of the situation and wanted to get some answers also for me when the three major insurance carriers were at the AACA Annual meeting her in Philly. Also fonote HAggerty, JC Taylor and Grundy were there and I got the same information from each of them. They were in different section in the vendors section so neither of them heard the reply that was given to me by each representative.

 

Rich Hartung

Desoto1939@aol.com

 

Rich Hartung

[Plymouthy Adams]

Rich..I read Don as saying he didckered for the repairs to be below the total cutoff value and thus got the car repaired as it should have been, being less than total the pink slip never got involved in the equation..he is back ont he road...title is intact and am not sure if even a carfax report would hae been registered against the car..I say this as if they used th body number on the A-post and  notpossibily the engine number on the title..the two would never jive...

 

Old car is not any more of a difference than standard insurance where value is subjective to either side..the owner or the payee...I hve had my rounds with insurance agents..stand firm and unrelenting you will be surprised what can be settled in your favor..they don't like it...they like to threaten with the pulling of the rental when you don't settle quick...the biggest ace in the hole for them there is...

[Young Ed]

Don did you really end up with a salvage title? The way I understand it for MN is if you buy it back the ins co never gets their hands on the title it never becomes salvage.

[Plymouthy Adams]

they are pretty hoton salvage titles here in Georgia...and I know also SC and West Virginia...states in which Ihave delat with..salvage titles is a must if the insurance paid a total..not that does not mean the car was destroyed or structually damaged..cosmetics on an old ca will quickly hit the total level..you do not get the payoff without surrendering the title..if you buy it back then you must completed the forms and be instpected to get a title..it will always be marked "salvaged"

[Don Jordan]

I hate to claim ignorance here but I'm afraid I didn't take good notes. Here's what I have written from October:

I had the car valued at $15,000 - they would pay only 70% to have it fixed. The salvage value was $2600 and they paid me $12,400 and that's what I paid the body shop. While I guess I ended up paying $2600 out of the $15,000 I never did fill out any paper work for the title. I guess I'll have to wait and see what happens when the tags come due. The whole thing was complicated with a lot of e-mailing back and forth. Again I found the agent at Hagerty very helpful and I made it through with my car. To reiterate, I'm not sure the status of the title.

I hope this helps. The bottom line is don't be stupid and wreck your car. Since it was my fault I'm glad they paid anything.

[Don Coatney]

When you first got the twenty grand quotation from the body shop I am curious if you or someone told the body shop the value of your poilcy?

 

About two years ago my area was hit with a huge hail storm. Roofing contractors rang my doorbell night and day trying to get the repair job. All stated up front that they would bury the $500.00 deductable and complete the job for what ever the insurance company would pay and they would not give me a quotation. I finally found a company that would give me a written quote without knowing how much insurance I had. That is the company that got my business. I believe most body shops do the same. They will write the quote to match the insurance payment. Dont get me started on health insurance scams.

[desoto1939]

I hate to claim ignorance here but I'm afraid I didn't take good notes. Here's what I have written from October: I had the car valued at $15,000 - they would pay only 70% to have it fixed. The salvage value was $2600 and they paid me $12,400 and that's what I paid the body shop. While I guess I ended up paying $2600 out of the $15,000 I never did fill out any paper work for the title. I guess I'll have to wait and see what happens when the tags come due. The whole thing was complicated with a lot of e-mailing back and forth. Again I found the agent at Hagerty very helpful and I made it through with my car. To reiterate, I'm not sure the status of the title. I hope this helps. The bottom line is don't be stupid and wreck your car. Since it was my fault I'm glad they paid anything.

 

 

Ok thanks for the update.  But what I am trying to state is that you had a 15K poiicy fot  agreed value and cost you XXX amt to insure based on the 15k per year.  But In reality you only had 70% coverage incase of an accident or 10500 to cover the cost of the repairs.  Do you now see the issue.  You thought you had 15000 of coverage but only had 10500 becasue of the 70% rule.

 

I understand what happened. But if you are a car owner then you need to make sure that your state does not have a 70 or 80% rule that really lowers the coverage for getting repairs done if in an accident.

 

Sounds as if you got the car fixed and they left you keep the title without the salvage title on the car. That is good news.

 

Just want to make the members aware of the states that might have percentage rates that will affect and damages.

 

Rich Hartung

Desoto1939@aol.com

[Don Jordan]

I do understand now - it was a shock at the time.

[Plymouthy Adams]

its not what the car cost it is what can you afford to pay monthly type thinking...

[desoto1939]

its not what the car cost it is what can you afford to pay monthly type thinking...

 

 

I do not understand what you are saying with your reply.  Are you trying to state it does not matter what the cost of the car is but what determines your ownership is what you can pay on a monthly basis for the amt of insurance coverage?

 

In our discussion at the AACA meeting the Three Insuracne carriers were stating that most people are carrying not enough on their cars to cover the costs of damage some just want to just cover the cost of what they paid for a car, but that is not the right way to think according to them. Yes they are there to sell insuracne but the cost of the parts is going up every year and the NOS and even used is now climbing very fast. I have seen this over the past several years on our MoPar parts.

 

Rich Hartung

[Plymouthy Adams]

Rich..I did not quote Don C. but should have I see so as not to confuse..my reply was to his post more than anything you or Don J have been discussing...

Personally if you are concerned you will ask..if not, then probablyt nothing you say here will prompt anyone into action.....its the ole 'not going to happen to me' syndrome in full force...you can warn which most are grateful that you have, but you can't beat a dead horse...