Insurance totaled my car offer too low
Here’s What to Do
If your insurance company has declared your vehicle a total loss, you may assume the amount they offer you is final.
It may not be.
Insurance companies determine the value of a totaled vehicle using their own valuation process. But what happens when their settlement offer isn’t enough to replace your vehicle with one of similar year, mileage, condition, options, and equipment?
Before accepting a settlement you believe is too low, it may be worth taking a closer look at how your vehicle was valued and what options may be available to you.
Can You Dispute an Insurance Company’s Total-Loss Value?
Depending on your insurance policy, you may have the right to dispute the insurance company’s valuation through what’s commonly called an appraisal clause.
The appraisal clause can provide a process for resolving disagreements over the value of a vehicle.
Instead of simply accepting the insurance company’s number, you hire an independent appraiser to determine the actual cash value of your vehicle.
The insurance company selects its own appraiser. The two appraisers then review the vehicle, documentation, comparable vehicles, market conditions, mileage, equipment, condition, and other factors that can affect its value.
Their goal is to reach an agreement on what your vehicle was actually worth immediately before the loss.
How Is the Value of a Totaled Car Determined?
Determining the value of a vehicle involves more than simply looking up a number online.
An independent automobile appraiser can consider factors including:
Year, make and model
Mileage
Trim level
Factory options and equipment
Vehicle condition
Recent tires or significant maintenance
Upgrades and accessories
Comparable vehicles currently available in the market
Local and regional market conditions
Comparable vehicles can be especially important.
If similar vehicles with similar mileage and equipment are selling for significantly more than the value assigned to your vehicle, that information may help support a higher valuation.
What If the Insurance Settlement Won’t Replace My Car?
This is one of the biggest frustrations drivers experience after a total loss.
You receive the insurance company’s offer, start shopping for a replacement and discover that comparable vehicles cost thousands of dollars more.
If that happens, don’t immediately assume you have to accept the difference.
Research vehicles that are truly comparable to yours. Look for the same year or similar model year, trim level, mileage, options, equipment and condition.
Save those listings.
Then compare them with the vehicles used in the insurance company’s valuation report.
If the numbers don’t make sense, an independent appraisal may be worth considering.
Don’t Rush to Accept a Total-Loss Settlement
After a vehicle is totaled, you may feel pressure to settle quickly.
Before signing an agreement or accepting a valuation you believe is too low, take some time to understand how the insurance company arrived at its number.
Ask for a copy of the valuation report.
Review the mileage, options, trim level and condition information for accuracy.
Look carefully at the comparable vehicles used to establish the value.
Then research comparable vehicles yourself.
A difference of a few thousand dollars can make a significant difference when you’re trying to replace your vehicle.
How Car Counselors Can Help
Car Counselors provides independent automobile appraisal services for vehicle owners who believe their insurance company’s total-loss valuation may be too low.
With approximately 30 years of automobile appraisal experience, Car Counselors understands how vehicle values are established and how the appraisal process works.
The process generally begins by reviewing your vehicle and the insurance company’s valuation.
Car Counselors then researches comparable vehicles and prepares an independent appraisal based on the vehicle’s mileage, condition, equipment and current market value.
If the appraisal clause is invoked, your appraiser works with the insurance company’s appraiser in an effort to reach an agreed value.
What Does a Total-Loss Appraisal Cost?
Car Counselors offers a simple approach:
The appraisal fee is $350, and you only pay if Car Counselors is successful in getting you more money for your vehicle.
If Car Counselors doesn’t obtain an increase in the value, there is no appraisal fee.
Every claim is different, and no particular increase can be guaranteed. However, Car Counselors has seen many successful appraisal cases result in additional settlements of several thousand dollars.
That’s why it can be worth investigating your options before accepting an insurance company’s initial valuation.
What Is an Umpire in the Appraisal Process?
Most appraisal disputes can be resolved between the vehicle owner’s appraiser and the insurance company’s appraiser.
If the two appraisers cannot agree, the appraisal process may allow for an independent umpire.
The umpire reviews the disagreement and helps determine the final value according to the terms of the policy.
In roughly 30 years of handling automobile appraisals, Car Counselors has only needed to take a small number of cases through the umpire process.
What Should I Do If My Car Was Just Totaled?
If you believe your insurance company’s offer is too low:
Don’t rush to accept the valuation.
Request the complete valuation report from your insurance company.
Check the report for incorrect mileage, trim, options or vehicle condition.
Search for comparable vehicles currently for sale.
Review your insurance policy for an appraisal clause.
Consider speaking with an independent automobile appraiser before accepting the settlement.
The sooner you understand your options, the better position you’ll be in to make an informed decision.
Think Your Insurance Company’s Offer Is Too Low?
If your vehicle has been totaled and you don’t believe the insurance company’s offer reflects its true market value, contact Car Counselors before accepting the settlement.
We’ll review the situation and help you determine whether an independent appraisal makes sense.
Don’t settle for less than your vehicle may actually be worth.
Frequently Asked Questions
Can I negotiate the value of my totaled car with the insurance company?
You can question the valuation and provide information supporting a different value. Depending on your policy, an appraisal clause may provide another method for resolving a disagreement over the vehicle’s value.
What is an appraisal clause in auto insurance?
An appraisal clause is a provision found in some insurance policies that establishes a process for resolving disagreements about the amount of a loss. The exact language and requirements depend on your individual insurance policy.
Should I accept the insurance company’s first total-loss offer?
Before accepting an offer you believe is too low, review the valuation report and compare it with similar vehicles in the current market. Once a claim is settled, your options may be more limited.
How do I know if my totaled car was undervalued?
Compare the insurance company’s valuation with vehicles of similar year, model, trim, mileage, equipment and condition currently available for sale. Also check the valuation report for incorrect information about your vehicle.
Can an independent auto appraiser help with a total-loss claim?
Yes. An independent automobile appraiser can research your vehicle’s market value, identify appropriate comparable vehicles and prepare an appraisal to support a different valuation
