The Insurance Value of Car Write Off- Find Out the Information That You Need To Know
The insurance value of car write off is one of the biggest and best kept secrets in the automobile insurance industry. From the instant you drive a brand new car off the car lot where you purchased it, your car begins to lose asset value in the eyes of the insurance company. There have, in fact, been cases where a newly purchased car was driven off of the new car lot and completely totaled within five minutes of the purchase being completed. Instead of insuring those customers for the full purchase price, the vehicle is credited with a diminished value and the customer is left to pay the difference, despite thinking that they are fully insured.
Diminished Value Also Applies To Vehicles Involved In a Collision
Let’s say that the new vehicle you just purchase and drove off the lot was involved in an accident, but in this case it wasn’t totaled. Your new vehicle, which cost you $25,000 in base price plus the interest in your agreed upon payment plan, needs $4,500 in repairs to make it functional again. You get the repairs made, and your new vehicle should be worth around $25,000 again, right?
Wrong. Whenever a vehicle is in an accident that has collision damage, the insurance company views the overall value of the car as less. Part of that comes from the fact that over half of the population says that they would never purchase a car that they knew had been in a collision. Eight out of ten people also said that if they were forced to purchase a vehicle that had been in a collision that they would expect a deep discount on the purchase price because of the repaired damage. It wouldn’t matter if factory parts were used to refurbish the vehicle. In the minds of a vast majority of people, a collision equals a discount, and the insurance companies agree.
You’re Entitled To Be Compensated For Diminished Value
What many insurance companies don’t want you to know is that in both of these circumstances, you’re actually entitled to be compensated for the diminished value. That’s right the insurance company could very well owe you money because of their very own practice! Now let’s say the accident is your fault and you’ve negotiated out the repair bill. The vehicle has been repaired and you have to sell it, but because of the collision, you ca only get $19,000 for your vehicle instead of the full $25,000. That means you are entitled to file for a claim of $6,000 in diminished value with your insurance company. If you were not at fault, you could have your insurance company file for this claim from the party at fault.
Before settling any claim, be sure to know what your rights are. You could be entitled to a lot of compensation and not even know it! The insurance value of car write off could very well mean the difference in recouping your total loss on your vehicle, no matter what its age.