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Yikes. (Reply to this comment)
by Horswispr
Thanks for the warning.
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Dec 01 '01
3:25 pm PST
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One Last Thing... (Reply to this comment)
by Alkaiser
"Well, there are and there aren't. I believe it's required by law, but State Farm, at least, provides separate adjusters and adjuster teams for both parties in an accident, if two parties are insured by State Farm. They do not share testimonial information, although they do share any inspection results on the vehicles, because that is considered "objective information". In other words, even if you were at fault in an accident, and you told your adjuster that, he could not tell the other party's adjuster. He couldn't deny it to the other party's adjuster, either, but...."
Hahaha...this happened. The first time my roommate got a call, if was from his adjuster. She took his statement, and when she was done she said, "Off the record, this looks like it's pretty much my client's fault."
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Nov 30 '01
10:11 am PST
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Re: Well... (Reply to this comment)
by Arthur.Rubin,  in Personal Finance
From your reply:
OTOH, California is a "no-fault" state. Both parties insurance rates go up after the crash,
This is not true in my experience in California. Only if the insurance company (not the police) find you at fault or if the insurance company pays out more than a certain amount under YOUR policy (other than "C" "R" and "U" coverages discussed below) is your policy surcharged.
From my first comment:
"First, as you know, the definition of "total loss" is that the repair cost exceeds the estimated value of the car before the accident. In "unibody" cars, if the body is bent, the car cannot really be repaired, so it should be declared a total loss, even if there is no visible damage. The "declared" value of the car, if there is one (I've never heard of such a thing), has nothing to do with it."
Your reply:
The repair shop said the cost to fix the car would be more than the low Kelly Blue Book value, so they had to declare it a total loss, but yet, the insurance company gave my roommate less than the cost to repair the car.
My further comment:
Well, actually, it would have to be the insurance company calling it a total loss -- and the insurance company is not supposed to pay out more than the fair market value of the car, regardless of repair costs.
Continuing your reply:
Third, the "declared value" I'm speaking of is the amount on each statement Mercury claimed his car was worth. It was the amount the premium was based off of.
I've never seen a "declared value" on an insurance policy. I'll take your word for it that it's there, but I still doubt it should be there. Nonetheless....
From my comment:
"Second, did your roommate have collision coverage? If so, then he should be paid (less deductible) by his insurance company fairly rapidly, and the rest of the effort is between the various insurance companies."
Your reply:
He had 50/100/50 coverage.
That's basic liability, not collision. $50,000 per person injured by you, up to $100,000 per accident, and $50,000 in property damage. My State Farm card and policy call that "A" liability coverage. I also have "C" (up to $5,000 medical expenses (per person) in my own car, regardless of fault), "D" comprehensive and "G" collision coverage on my own car, "H" emergency road service (I've never used it, but it only costs a few dollars a year), "R2" rental coverage, "U" uninsured and "U1" underinsured coverage.
If your roommate had "C" coverage, your medical expenses could be paid out of his policy without surcharging his insurance rates, and then the two Mercury adjusters could argue about which policy should be responsible.
If your roommate had "G" coverage, the fair market value of his car (less deductible) would be paid out of his coverage, and the two Mercury adjusters could argue about which policy would be finally responsible, and whether the other party's insurance would pay your deductible.
From your reply:
There aren't really "various" companies invovled here.
Well, there are and there aren't. I believe it's required by law, but State Farm, at least, provides separate adjusters and adjuster teams for both parties in an accident, if two parties are insured by State Farm. They do not share testimonial information, although they do share any inspection results on the vehicles, because that is considered "objective information". In other words, even if you were at fault in an accident, and you told your adjuster that, he could not tell the other party's adjuster. He couldn't deny it to the other party's adjuster, either, but....
My comment:
"Third, who declared the car a total loss?"
Your reply:
That would be his adjuster.
My further reply:
His adjuster, or the other party's adjuster? I suppose it would have to be his, but these would have different consequences.
I think I'll rerate to Very Helpful anyway. There are some misstatements in the review, but I now believe them to be misstatements by Mercury. I'm still convinced that this "declared value" is one of them.
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Nov 30 '01
7:00 am PST
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Well... (Reply to this comment)
by Alkaiser
OTOH, California is a "no-fault" state. Both parties insurance rates go up after the crash, but then again, I've never been in an accident, so I don't for sure.
As to your other points:
"First, as you know, the definition of "total loss" is that the repair cost exceeds the estimated value of the car before the accident. In "unibody" cars, if the body is bent, the car cannot really be repaired, so it should be declared a total loss, even if there is no visible damage. The "declared" value of the car, if there is one (I've never heard of such a thing), has nothing to do with it."
The repair shop said the cost to fix the car would be more than the low Kelly Blue Book value, so they had to declare it a total loss, but yet, the insurance company gave my roommate less than the cost to repair the car.
Second, the car's not unibody. It's got definite plates and stuff to it. I could understand if it was like a Pontiac Fiero or something, but this wasn't anything like that.
Third, the "declared value" I'm speaking of is the amount on each statement Mercury claimed his car was worth. It was the amount the premium was based off of.
"Second, did your roommate have collision coverage? If so, then he should be paid (less deductible) by his insurance company fairly rapidly, and the rest of the effort is between the various insurance companies."
He had 50/100/50 coverage. I think that includes collision damage. Bodily harm, property, and uninsured motorist. These seem to me to be things that are only achieved through collision. There aren't really "various" companies invovled here. The guy at fault and my roommate have the same insurance company.
"Third, who declared the car a total loss?"
That would be his adjuster.
"It's unclear from your writing whether that they declared that the car was "salvage" before the accident (in which case you have the right and duty to be upset), or after the accident."
In either case he's got the right to be mad. If they declare it salvage afterwards, that means they're going to rebuild and resell it, which is all he really wanted, the car to be fixed, but they went ahead and declared it a loss. (That was the fastest part of the whole process.)
Beforehand, he's got even more right. I don't see any bright spots here for Mercury.
"Look, again -- how do you know "The insurance company charges him as if it were an $8400 car.". "
It's on his bill. It states quite plainly that THAT is the value of his car.
"Fair market value" is fair market value, usually high fully adjusted Blue Book (including mileage, which you may not have properly adjusted your calculation of Blue Book value for).
The car had slightly over 100,000 miles on it, had just been painted, and the car had been in nearly perfect running condition. Seriously, I've seen him driving this car for the last 6 years, and he has never taken it in to the shop for anything more than replacing one of his rims. I don't see how those facts lead to fair market value being the low Blue Book Value-$1100.
"you wouldn't be covered for rental long after the car was declared a "total loss"."
Ah, that would be the cas if they were actually doing anything. The car was declared a total loss over 2 weeks ago. They gave my roommate his for the settlement this Tuesday.
Here's the best part. My roommate asks the claims person what he should do about the rental car. She says, "I don't know. I can't help you." He says, "No, I'm asking you a question. What should I do about this now?" She tells him to borrow money from a friend.
Then he asks her about the whole situation, "Does any of this seem even remotely fair to you?" To which her response is uneasy silence.
I think that probably just about sums it all up.
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Nov 29 '01
5:41 pm PST
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As the first one... (Reply to this comment)
by Arthur.Rubin, in Personal Finance
to rate this review below Very Helpful, I thought I'd explain my concerns with the review. If you explain yourself further, or rewrite the review, and let me know (by E-mail), I'll rerate. I will post your excerpts from the original review in italics.
You wrote:
I call in to say I'm not hurt. After all, I'll heal, and I don't want to be a jerk to the guy.
Bad move. But it's your call. OTOH, if your roommate had medical coverage on his policy, that would pay for your expenses (up to the limit, usually $5,000), and they would have go after the other party for reimbursement.
Later on, we find that the car has been declared a "total loss". The right front, like tenth of the car has been damaged. If you didn't know better, it'd look like my roomate ran into a pole or something at low speed. We are both boggled by the fact that it's a total loss. We figure, since the insurance company is declaring his car at a value of $8400, and that's the price they're charging his policy at, that's what he'll be getting. .
Three points here. First, as you know, the definition of "total loss" is that the repair cost exceeds the estimated value of the car before the accident. In "unibody" cars, if the body is bent, the car cannot really be repaired, so it should be declared a total loss, even if there is no visible damage. The "declared" value of the car, if there is one (I've never heard of such a thing), has nothing to do with it.
Second, did your roommate have collision coverage? If so, then he should be paid (less deductible) by his insurance company fairly rapidly, and the rest of the effort is between the various insurance companies.
Third, who declared the car a total loss? Many insurance companies, when both parties are insured by the same company, assign different adjusters (and different adjuster teams) to the parties, so that there isn't a direct conflict of interest. If it's your roommate's adjuster, then you may have a complaint. If it's the other party's adjuster, then your roommate needs to contact his/her adjuster.
Later on down the road he gets a call from his adjuster. They're declaring his car as "salvage".
It's unclear from your writing whether that they declared that the car was "salvage" before the accident (in which case you have the right and duty to be upset), or after the accident.
The LOW Kelly Blue Book value of my roommate's car is $3500. But that's not the main thing ot look at here. The insurance company charges him as if it were an $8400 car. When it's declared a total loss, they give him $2400 for it, because that's "fair market value".
Look, again -- how do you know "The insurance company charges him as if it were an $8400 car.". "Fair market value" is fair market value, usually high fully adjusted Blue Book (including mileage, which you may not have properly adjusted your calculation of Blue Book value for). The cost of the new paint job is irrelevant except insofar as it affects the general condition of the car.
It gets better. My rommate is using a rental car. It has now been 28 days since the accident. Enterprise wants him to put another $900 on the car, since he's been using it on the $200 he paid up front. He asks Mercury for the cash. They say no, they can't just bill it to the guy at fault, because he's at his coverage limit. You see, the 98 Civic he hit is valued at a little less than twice my roommate's car. (I firmly believe this is a result of having a different insurance company's adjusters on hand to yell at the Mercury guys.) His coverage won't allow them to pay for any more of the accident. They want my roommate to foot the bill for the rental car, and they'll pay him back...
I've never heard of the other party's insurance company paying for rental coverage before a lawsuit is filed, even if they would eventually have to pay for it. If your roommate had rental coverage on his policy, that would be different -- but, even then, you wouldn't be covered for rental long after the car was declared a "total loss".
Many of my comments, as well as some of yours, are irrelevant if you live in (or, possibly the accident occurred in) a "no-fault" state.
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Nov 29 '01
4:40 pm PST
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