SOME HELPFUL INFORMATION TO REMEMBER WHEN YOUR VEHICLE HAS BEEN DAMAGED IN AN ACCIDENT
Most of us find it very hard to manage life without a vehicle. We need them to take us to work, drop our kids off at school, keep appointments, and run errands needed to maintain a household. So, when our vehicles get damaged in an accident, it can be very upsetting. Sometimes, in a total loss situation, we lose our vehicle permanently. But, even in a small accident, dealing with the adjuster, the body shop, and rental car can take up our time and try our patience. Even worse, if you are not claiming bodily injury, you will not be able to retain an attorney to help you deal with property damage issues. Over the many years that I have practiced personal injury law, I have found that most of my clients seem to be even more traumatized over the damage to their car than the broken leg they suffered in the accident. Here’s what I tell my clients about handling their property damage matters. I hope you find it helpful. OH NO! THE OTHER DRIVER HAD NO INSURANCE If the driver that caused the accident did not have valid insurance, let’s hope you had Uninsured Motorist coverage on your insurance policy. If you did, no problem. Your Uninsured Motorist coverage will take care of you. This means your insurance company will handle the claim, pay the body shop, wrecker, any storage costs, and get you going again. They usually then go after the deadbeat driver, but it makes no difference if they ever recover a penny, you’re still covered and you will have been compensated. Congratulate yourself for being smart enough to buy the extra coverage. If you were not fortunate enough to have Uninsured Motorist coverage, your road is tougher and, in all honesty, you’re probably sunk. But, don’t lose all hope yet. Here’s what you can do. First, investigate thoroughly to make certain the other driver was in fact uninsured. If his coverage had lapsed with one company, maybe he had purchased coverage with another company. If he was driving someone else’s car, maybe he’s covered under his own policy, or the policy of the person who is the head of his household. Remember, the rule in Texas is that the insurance follows the car. This means that no matter who was driving the car, the first insurance company on the hook is the company that insured that vehicle. If that vehicle did not have coverage, then you look to see if the driver was covered under a different policy. If the driver owned his own vehicle, you have a good chance of finding insurance coverage. If you are not able to find any coverage at all, you’re only recourse is to sue the driver in small claims court, get a judgment against him, and then hope he pays it. Small claims courts are used to handling claims for people without attorneys and the clerks will generally be very helpful in explaining how to file your suit and how to serve the Defendant. After that, it’s just a matter of telling the judge how the accident happened and presenting him with the estimate from the body shop. If you win (and you probably will), you need to notify the Defendant in writing, send him a copy of the judgment, and demand payment. Be prepared to put him on a monthly payment plan if he can afford it. In the meantime, send a copy of the judgment to the Texas Department of Public Safety and ask them to suspend the Defendant’s driver’s license and car registration until you notify them that the judgment has been paid. I have to tell you, even if you have gotten this far, chances are very small that the Defendant will ever pay you a penny. It has been my experience that most people would rather drive with a suspended license than take responsibility for their actions and pay. This is true even after they spend a few nights in jail and pay a fine for driving while license suspended. I know because I have had licenses suspended on several occasions and I have yet to see a penny paid to my clients. But whether or not you ever receive compensation, you will probably at least be content in knowing you at least suspended the other guy’s driver’s license. He will remember you for a long time. THE OTHER DRIVER HAD INSURANCE Consider yourself lucky. It has been my experience that most insurance companies, even the worse ones, will deal fairly and professionally with you on property damage issues. Of course, they are not going to volunteer any extras, such as paying for the loss of use of your auto while it is being repaired or the diminution of the value of your vehicle. Usually, the insurance company for the at-fault driver will pay for a rental vehicle for you while your car is in the shop for repairs. However, if you have a second vehicle or otherwise can get by without a rental vehicle, you are entitled to a cash payment (usually $25 per day) for every day you were unable to use your car. A case styled Lone Star Dodge vs. Luna, gives you this right. You should also ask the adjuster to compensate you for the loss of value to your vehicle as a result of being damaged in the accident. This is called diminution of value and usually is available to you, especially if your vehicle was less than 2-3 years old. MY VEHICLE IS A TOTAL LOSS Total loss cases are a little different. In essence, a total loss situation puts you into a forced sale of your vehicle. Here are some helpful things to know.
- THINK AHEAD BECAUSE YOU WON’T HAVE MUCH TIME: Things move pretty fast in a total loss situation. As soon as you suspect that your vehicle will be totaled, you need to start looking for a replacement vehicle and you should also be researching the value of your vehicle. This, of course, if very stressful. At a time when you are probably in a lot of pain from your injuries, you are expected to go car shopping and get ready to sell your old vehicle. And it all usually has to be done within two weeks of the accident.
- WHAT’S YOUR OLD CAR WORTH? Value is defined as what a willing buyer would have paid a willing seller for your vehicle in the condition it was in just prior to the accident. Most, if not all, insurance adjusters do a good, thorough, and fair job of evaluating a vehicle’s value. NOTE: This is the only time you will see me write the words “adjuster” and “fair” in the same sentence, but in my experience, property assessment by adjusters has usually been a fair process. They check everything from tire wear, dings and nicks, interior stains and scratches, to the overall meticulousness of how you maintained your vehicle. If you have researched value yourself, and if you have examples of similar vehicles in your area that are valued higher than your adjuster has valued yours, you may be able to get an additional one-hundred or so dollars, but not much more. It also helps if you have receipts showing improvements to your vehicle, such as stereo systems, rims, etc.
- WHO DECIDES: The insurance company adjusting the claim will usually be the sole decider as to whether your vehicle is a total loss or should be repaired. If it’s a close call, on rare occasions I have seen the insurance company let my client decide which way he wants to go.
- HOW IS THE DECISION MADE: The decision to total out a vehicle is reached when the cost to repair the vehicle equals 80% or so of its value. They know that once the body shop starts taking the damaged parts off the vehicle, they will probably find other damage that needs to be accounted for, adding to the insurance company’s cost. Sometimes, a vehicle is totaled because the damage is such that the vehicle simply cannot be rendered street safe.
- WHAT ABOUT A RENTAL CAR IN A TOTAL LOSS SITUATION? The law says that you are entitled to a rental vehicle while your car is being repaired. In a total loss situation, it is obviously not being repaired and legally, you are not entitled to be compensated for a rental vehicle. Most companies, however, will allow for rental reimbursement from the day of the accident until an offer is made on your vehicle. In other words, until the day the adjuster tells you how much he is willing to pay for your vehicle.
- WHAT ABOUT THE PAPERWORK? The adjuster will ask for a copy of your car title. If you own your car outright, he will deal only with you. If there is a lienholder on your title, the adjuster will need to obtain the payoff amount from your lienholder and write the lienholder a check for that amount with the balance to you. You will also be asked to sign an odometer statement and an instrument called a power of attorney, which will allow the insurance company to negotiate the title.
- BUT CAN I KEEP MY CAR?Many times you can keep your car, provided you own it outright and the adjuster does not deem it unsafe. Many people want to keep the wrecked car, especially if it is very old, has a reliable motor, and does not need to be fully repaired in order to make it street legal. It’s even better if someone in your family is in the body shop business. You can get your old wreck patched up with used parts, leave in the dents that don’t interfere with safety, and drive your old reliable car again. If you decide to keep your vehicle, the adjuster will pay you the agreed value minus the salvage value, which is generally about 10% of the value of your vehicle. Why salvage value? Because once the adjuster buys the car from you, he will sell it for salvage and get some of his money back. By taking the wreck back, you are denying him the salvage value.
- I OWE MORE ON MY CAR THAN THE ADJUSTER SAYS IT’S WORTH!This is known as being “upside down” in a car. This happens when you have recently purchased the vehicle and it is either brand new and/or you did not pay a big enough down payment. Sometimes even when with the purchase of an old vehicle, most people pay too much to the used car dealer. This is especially true if you don’t have a good credit rating. The reality is that most people cannot afford to pay cash for their vehicles. This means buying a vehicle requires a loan, which usually adds extra fees and expenses to the purchase. Then, of course, there is the depreciation factor. The minute you drove the car off the lot, it was worth a lot less than what you just bought it for. Unfortunately, insurance law does not factor in loan costs, interest payments, and down payments. I tell my clients that the law presumes we are all rich and can pay cash. That means that you will get paid what the car was worth to a willing buyer just prior to the accident, regardless of how much additional money you paid the dealer and the loan company. The only way to prevent being upside down from happening is to purchase gap insurance.
DEALING WITH THE ADJUSTER Handling property damage claims is often time consuming and frustrating. This is especially true because most property damage adjusters are hard to get on the phone and will not return calls. I advise my client to be persistent and to always be professional and polite. You will not get anywhere being rude to the adjuster. He is in total control and he can make your life miserable if you get on his bad side. Your voicemails should be polite and short. Just identify yourself, give your contact information, your claim number, and make a request to please call as soon as possible. Speak slowly and with your best enunciation so he can understand you clearly. Once he has ignored two or three voicemails, you need to step up your game. Call three or four times a day, but keep to the above rules of politeness. It does no good to complain that chasing him down is keeping you away from work, etc. If multiple calls a day don’t produce a response after two days or so, it is time to dial the main number and ask to speak to his supervisor. If the supervisor is as unresponsive as the adjuster, ask for the supervisor’s supervisor. You will eventually get someone’s attention I guarantee. CONCLUSION Now that you know a little about the process of claims handling, hopefully your experience with property damage issues will be a little less traumatic. It is important to keep in mind that the adjuster is not out to get you. He would like to close cases as fast as possible because the more cases he can close the less busy he will be. You can make it more pleasant for him to handle your case (and therefore pay more attention to your claim than the next guy’s) by being polite, to the point, and reasonable in your expectations. I always find it helpful in dealing with adjusters to say something positive in the very first conversations, such as: “Thanks for getting to me so fast. I know you’re busy. Thank you for helping me.” Good luck. Robert Rodriguez Attorney