Auto Insurance Settlement....am I getting jacked?

Question

I crashed my car and AAA is telling me the car is going to be totalled because the amount of repairs is > the value of the vehicle.

A "settlement advisor" called me today to offer me $13,000 for my car (2005 PT Cruiser Turbo Limited, fully loaded, Nav system, moonroof, 41000 miles). I owe $15,900 on it still (no gap insurance)....and Kelley Blue Book values it at $16,415, NADA at $15,675 and Edmunds at $15,827. I complained and the advisor said "we use Auto Trader b/c Blue Book is inflated", but he looked up a similar car (touring edition, much cheaper) and said he could up the quote $600, for a grand total of $13,600. I have to accept/reject within the day (pressure tactics!) or risk losing the offer and having the car valuated.

I just called AAA as a potential insurance buyer and asked how they value cars for pay-out. She told me they use Blue Book dealer retail, which would be AWESOME for me.

Thoughts? Advice? Should I turn down the offer?

Now they're telling me they haven't used Kelley Blue Book dealer retail in years... I don't know what to believe :\

$500 deductible

Answer 1

I don't know where you live. In WV, where I live, you have the right to receive the curb or retail value for your auto. We have two options for pursuing this:
1. The State Attorney Generals Office. Find them in the blue pages in your phone book. The A.G. will pursue it for free, but you are going to have to keep the payments up, and possibly find another way to finance the gap.
2. The State Insurance Commission. Find them in the blue pages in your phone book. They also will pursue for free, but can't force them to pay. The I.C. can only threaten them with taking away thier ability to do business in the state.
A member of my family went through this, and his finance company repo'd his car and settled with the insurance company without his knowledge. After doing this, they sued him for the difference. Get the loan covered the best way that you know how, otherwise they will try to do this to you. It is a favorite scheme of theirs, because they know what you owe, and know that you probably cannot cover the gap.

Answer 2

I work for AAA and let me make one thing very very clear...neither AAA, or any other insurance company out there, uses Kelly Blue Book, Auto Trader, Nada, etc. to settle total loss claims. They all use outside market research companies to determine the Actual Cash Value of your vehicle--comparing your year/make/model/condition/mileage/options to those in the market place. This gives a more accurate figure.

Unless you are speaking to the claims adjuster, information you receive from an agent, customer service agent, travel agent, etc. is not reliable--adjusting claims is not their area of expertise, they are not privy to the various legal issues at hand.

By law, you are only entitled to recover the ACV of your vehicle, which may or may not pay off your loan. They are not responsible for what is known in the car industry as "over financed" vehicles or depreciation.

You can turn down the offer, you can accept the offer. You can get your insurance company involved and have them run the numbers on your vehicle and then take the better offer.

I am curious though, as there are only 2 AAA clubs in the U.S. that write insurance, which club you're dealing with, Auto Club of So. Cal, or CSAA.

Answer 3

Kelly, NADA, ADP, etc. are just GUIDES. The amount they owe you is the actual cash value (ACV) of your vehicle prior to the loss. Find as many vehicles in your area as much like yours in options and mileage that are for sale and list the phone numbers and prices. If the average selling price of these cars are higher than what AAA is offering then tell them and be prepared to fax all your info to them. If not, then you better settle. Don't worry about not accepting the offer today. This only means they can stop paying rental and the original offer will be void. They still have to pay you so take the time to do you research if needed. It has been my experience that Kelly has prices much inflated to the real world market -- more in tune with used car dealer prices than private sales so don't flip-out if you locate five PT's that are for sale under 15K. Above all, keep a cool head and remain polite -- even if you have to ask for a manager. A$$holes are treated in like kind at a claims office and you will get much more traction by being professional vs combative.

Answer 4

You didn't say, but I bet you got a $500 or $1000
deductible and they are going to take that from the offer amount.

They have a legit deduction on your 2005 with 41000 miles for high mileage too.

Answer 5

What Cowboy Bill said. Also, not all insurance companies use the same guide. My company uses NADA value in claims situations.