A: The insurance company of the person who caused the wreck is required to provide you with a rental car. If you caused the accident, or there is not another person to blame, you must look to your insurance policy to determine if rental coverage is available. Many insurance contracts do not provide rental coverage for their own customers.
A: The insurance company will not pay for extra insurance you purchase 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 a rental car.
A: Normally, the rental car agreement only covers one driver. You will have to pay extra charges if you want other family members to drive the rental car while your car is being repaired.
A: Insurance companies often receive a discount with car rental companies. Ask the insurance adjuster handling your claim where you should obtain a rental car. The insurance company has to pay for the reasonable rental cost of a substitute vehicle. Clearing the rental car company and approved charges with the adjuster will avoid the possibility of paying extra. Sometimes, you must pay the rental car bill first, and get reimbursed by the insurance company later.
Getting Your Car Fixed
A: Normally, the insurance company has the option to repair or replace your car. It is usually a question of cost efficiency. That is, if it costs less to replace your car than to repair it, the insurance company will declare your car a “total loss,” and take action to replace your car.
A: In the event the insurance company chooses to repair the car, you have the right to decide who will repair your vehicle. Many insurance companies will evaluate the cost of repairing your car separately and independently from a repair shop. The insurance company will then work with the repair shop of your choice to get your car repaired.
A: Sometimes the insurance company will claim that some damage to your car existed before the 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 auto accident and the damage you are claiming. Ordinarily, mechanics and body repairpersons 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 auto accident caused the damage.
A: The insurance company must return your car to the condition it was in before the accident. Because your car was probably not new, the mechanic may use refurbished or reconditioned parts. However, you have the right to demand original manufacturer parts.
A Total Loss
A: A “total loss” is when it costs more to repair your car than to replace it. If your car is declared a “total loss,” the insurance company buys your car for its market value. A rental car must be provided until the adjuster makes a reasonable offer. The difficulty is determining market value. Sometimes it takes a week or two before an offer is made; however, the insurance company normally has 30 days to process your claim.
A: Normally, the insurance for the driver who caused the accident will pay the reasonable towing and storage costs of your car. The insurance company will continue to pay the storage costs while determining if your car is a “total loss.” If the insurance company declares the car a “total loss,” they will move the car from the repair shop to a wrecking yard or a free storage area. You will be called before your car is moved. If you refuse to allow the insurance company to move your car, you will have to pay the storage costs from the day of your refusal forward. If you want to keep the vehicle, you can pay to have it towed to your home.
A: You are entitled to the “fair market value” or the “actual cash value” of your vehicle. Insurance companies usually determine fair market value by referring to the “Blue Book” or a similar publication. Once the insurance company makes an offer, it is up to you to either accept the offer or show why your car is worth more money. If you think your car is worth more than the amount offered, check with the newspaper or the Auto Trader for the sale price of cars with the same make and model as yours. If you owe more money on the loan for your car than its fair market value, you are considered “upside down.” Unfortunately, the adjuster will not pay more money to you simply because you are “upside down” with your car loan. The insurance company is only obligated to pay the “fair market value” of your car.
A: When an older car is involved in an accident, it is hard to recover the cost of recent repairs. New tires or a new engine only slightly increases the value of a vehicle. If you have receipts for the new motor or tires, show them to the adjuster. Simply giving the adjuster the receipts may prompt a better offer.
A: When you are offered a “total loss” settlement, the insurance company buys your car. If you wish to keep the wrecked car, you may purchase it back from the insurance company for its salvage value. The adjuster can deduct the salvage value from the settlement and you can keep the car.
A: Besides the price of the vehicle, you had to pay sales tax, and registration fees. You are entitled to be reimbursed for the prorated amount of these costs which are unused. The insurance company should reimburse you for the prorated amount of your yearly car tax and registration fees.