How Much Will My Car Insurance Offer Me?

January 27, 2012

Have you ever wondered, "How much will my car insurance offer me if my vehicle is totaled?" It's a lot lower amount than you might think. In fact, it's the duty of the claims adjuster to get away with paying as little for your vehicle as possible, in order to save money for the car insurance company. Your car insurance company uses methods to value your vehicle that are probably much different than the ones you would use. Understanding the way the insurance company values your vehicle will help you negotiate a better settlement and receive more money in the event it's totaled in an accident.

How the Insurance Company Values Your Vehicle

If your vehicle is involved in an accident, and the claims adjuster believes that it's not worth repairing and totals the vehicle, the insurance company will use some very sophisticated methods to value your vehicle. The process will begin with the adjuster making a determination if your vehicle is in excellent, good, fair or poor condition. The only time the adjuster will consider your vehicle to be in excellent condition is when it is less than a couple of months old.

The insurance company will then use sophisticated software to determine how much similar vehicles in your area are selling for. They may also ask for third-party appraisals and do comparison shopping on the Internet.

Negotiating a Higher Value

In order to get more money for your totaled vehicle, you should always be proactive in getting quotes from local-area dealerships for vehicles that are similar to yours. Make sure that you keep detailed records about maintenance and repairs performed on your car, to show the insurance company that it was in good shape at the time of the accident. Don't be afraid to write a demand letter and explain to the insurance company why you should receive a certain amount for your totaled vehicle.

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