After a car crash, it’s crucial to understand how your insurance company determines the value of your totaled vehicle. Here are secrets behind the process—a data-driven calculation using proprietary software.
1. A Computer Determines Your Vehicle’s Value
To value your total loss vehicle, the insurance company relies on a computer. This automated process generates a value based on information about vehicles similar to yours currently for sale on the market. Unlike traditional negotiations, there’s no “give-and-take” or “horse trading” as you might experience when selling to another person.
Generally, the insurance adjuster is not allowed to deviate from the number that the computer spits out as the value of your vehicle. The only way you can change the value is to give the adjuster new data.
2. Cherry-Picking Data Lowers Your Vehicle’s Value
The insurance adjuster goes onto Auto Trader or a similar platform and finds 5 to 10 vehicles for sale of the same make and model as yours. He then inputs their sale prices into the computer software.
For the same vehicle, there may be a difference in advertised prices of $5,000 to $10,000. Unfairness arises when the insurance adjuster, under the instruction of the insurance company, inputs only the lower-priced vehicles. Leaving out the higher-priced vehicles skews the data so that it does not reflect the fair market value of the vehicle.
3. Omitting Special Features Lowers Your Vehicle’s Value
The insurance company also often omits special features like a sunroof, upgraded stereo system, or other custom modifications that should add value to the vehicle.
4. Demanding a Recalculation with Complete Data
When you receive the insurance company’s total loss offer, you should request the total loss report. The report shows in detail what vehicles the adjuster used for comparison, and what specific traits of your vehicle he included.
If you see that the adjuster left out the higher-priced vehicles in the valuation report, or that he ignored special features of the vehicle, you have the right to demand that the adjuster generate a new report using complete data. You should give the adjuster copies of the advertisements for the higher priced vehicles and firmly request that he include them. You should also provide documentation of the special features of your vehicle that he omitted.
5. Request Arbitration for Unfair Offers
If the insurance company refuses your demand, you can request arbitration, bringing in a neutral third party to review complete data and assess your vehicle’s value.
Understanding these insider secrets empowers you to get a fair value for your total loss vehicle. If you have questions, please feel free to call John Evans at 480-573-0600.
John Evans Injury Law
