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How to settle with insurance company

how to settle with insurance company


Tips for dealing with insurance company to settle Total Loss case

I knew very little about how auto insurance company worked until very recently. During the labor day weekend, I took the kid to the park. We parked the car legally on the street near the park. A few hours later, when we returned, the entire rear end of the car was smashed. There was a note left by police.

Apparently, a delivery truck had hit my car from behind. The driver tried to flee the scene. But, a couple of neighbors nearby heard the accident. They rode their bikes to caught the driver, and called police. The driver claimed that he didn’t know his truck hit my car.

I immediately contacted the trucker driver’s insurance company. After reviewing the police report, they agreed that it was the truck driver’s fault. However, they had estimated that it would cost more for them to repair my car than paying me some cash based on the market value of my car. They declare my car as Total Loss.

Before this accident, I even didn’t know that insurance company could just declare a car as total loss even though my car was still drivable. I really liked my car. But, I had no choice when they declared it as "total loss". (I could still get my car back if I pay some money to the insurance company to buy my car back, but it will forever be labeled as a savaged vehicle, which essentially has no re-sell value.)

I’m the victim, but I cannot even decide if I want my car to be repaired or getting a cash compensation. In my opinion, there is something wrong with our insurance law and regulations. But, that’s a different topic. I shall not digress.

I spent the next 12 weeks to negotiate with the insurance to settle the total loss amount. It was worse than having a root canal. The insurance company applied every single dirty tactic you could imagine. But, I did my homework. I was firm, strategic, and tough with them.

In the end, I reached a settlement with them at a cash value that was over $1,000 higher than what they offered. And

this is for a car that has a market value of about $6000 according to Kelly Blue Book.

If you’re in similar situations, below is my top tips for negotiating with insurance companies settle your Total Loss case, and not get ripped off by the evil insurance companies!

  • never accept the initial offer by the insurance company
  • they’ll tell you that they have asked a 3rd-party company to estimate the market value of your vehicle. And they cannot change the estimate. Yes, they can! Do you research. Search online. Search your local papers. Search Find comparable cars that are selling at higher price. Show them. They must consider what you find.
  • go to your state insurance commission’s web site. make sure you have a thorough understanding of your state’s law/regulations that protect consumer in total loss case. You need to know your rights.
  • when they offer you a rental car for 2 weeks, ask for 2 months or longer. it’ll take a long time to resolve a total loss case. In my case, the process took 3 months. You need a vehicle to drive during this time. 
  • if the appraiser is being unreasonable with you, don’t be afraid to ask that "I need to talk to your manager". Keep escalating. The appraisers are trained to give you a hard time so that you will give up the fight. Don’t let them get into your skin. Be firm, and be tough. It’s your car. You’re the victim. You desire a fair compensation.
  • do your homework. you should figure out the fair price for your car — that’s the amount that you want to get compensated by the insurance company. Make sure you include tax, and other fees. They need to pay you the total amount that you need in order to buy and register a replacement of your lost car.

In this economy, a lot of insurance companies are having financial troubles (just look at AIG). They’ll try to squeeze every single cent from consumers. You need to stand firm and protect your rights. It’s up to you to get fair compensation for your lost vehicle. Don’t give up. Have a good fight!

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Category: Insurance

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