Faqs

Total Loss FAQ (11)

No you do not have to accept the Original Offer to Settle. You are allowed to ask for the Market Value Report and Estimate to Repair and review for shortcomings.

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After your vehicle is Totaled Out the Insurance Company will generate a Market Value Report on your vehicle to determine what they feel is the proper Settlement Value. You have a right to this Market Value Report. This Report alone is the foundation in which the Insurance Company will use to access your Vehicle Value.

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Vehicle Value Experts will analyze The Market Value Report provided by The Insurance Company and identify each and every error contained in said Report. Thus, almost always resulting in a Higher Settlement.

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The loss in value of a damaged vehicle is known as Diminished Value. The amount of Diminished Value of a damaged and repaired vehicle depends upon several factors including: the pre-loss value of the vehicle, the nature and severity of the damages and the cost, manner and thoroughness of the performed repairs.

Consider that, when a vehicle is in an accident, it loses its greatest value just after the actual impact or occurrence. During the dismantling, repair, installation and painting of replacement parts, the value is slowly restored as the repairs progress.

The full original value will likely never be regained simply because the vehicle now has a history of damage that it did not have before the loss. Prior damage history will be disclosed to potential buyers who will likely not pay the same for a vehicle with a damage history as compared to one with no damage history. This is often referred to as “the damaged goods syndrome”.

If the repairs are done thoroughly and in a workmanlike manner, the value of the vehicle can be maximized to the best of reasonable human ability but likely never to its pre-loss value.

If the repairs are done to less than thorough and workmanlike standards, the recovery in value will be limited accordingly, and the vehicle will suffer a greater loss or diminishment in value.
The more significant the damages, the greater the loss in value. The poorer the repair quality, the less recovery of the vehicle’s original and pre-loss value.

In order to make this determination you should secure the services of an independent professional to perform a visual inspection of the vehicle and prepare an expert assessment of your remaining loss.

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As a result of damages sustained in a covered loss and a claim made against an insurer, the insurer is obligated to provide for either the repair or replacement of the damaged property.

Normally the insurer is given the authority to make the decision to either repair or replace the damaged property. Once they make the decision they are held to a level of “pre-loss” condition and/or “actual cash value” (ACV).

Should the insurer elect to repair a damaged vehicle, they owe the costs to restore the damaged vehicle to its pre-loss condition to the best of reasonable, human ability.

Should the insurer elect to deem the damaged vehicle to be a total-loss, they are obligated to provide replacement or actual cash value enabling the claimant to purchase another vehicle equal to the value of the damaged vehicle, immediately prior to the loss. The rules of indemnification are clear in as much as what is owed is what was possessed just prior to the loss, no better and no worse.

Additionally, you may be entitled to sales tax, tag and title transfer costs in the event your vehicle is determined to be a total loss.

You may be entitled to ‘loss of use’ (temporary substitute vehicle) during the time required to make repair; or, seek a replacement vehicle from the at-fault party, their insurer, or as may be provided by coverage within your personal insurance policy.

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If you make a claim against your own insurer it is considered a first party claim and you will be dealing with your insurance company based on the terms and conditions as outlined within your insurance (contract) policy.

If the accident was someone else’s fault and you are making a claim against them through their insurer, it is considered a third party claim. You are under no contractual obligation to let the other person’s insurance company inspect the damages or determine the extent of damages or cost of repair. You may, if desired, secure repairs and merely submit a bill to the at-fault party and/or their insurer for reimbursement. The at-fault party’s insurer will likely provide for your damages based upon the ‘limits of liability’ coverage under the at-fault party’s insurance policy.

It’s important to understand that the at-fault party owes you for your damages and while their insurer owes them under the terms of the property damage portion of their policy contract, the at-fault party’s insurer legally owes you, the victim, nothing. The insurer will normally attempt to settle the claim on behalf of their insured as is owed to their policyholder under the terms of their insurance policy.

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The key to recovering all losses owed is to know just what it is that is owed you. Having an in depth visual inspection of the damaged/repaired vehicle and accurate assessment of your remaining damages prepared for you and understanding the necessary steps in the recovery process in paramount. Providing a detailed report with your claim will enable the insurer a clear understanding of your remaining loss and facilitate a more timely settlement.

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YES. Vehicle owners have the right to disagree with any assessed amount of loss. Depending on the policy and state law, provisions are provided for dispute resolution. Of course before one can make a determination if the insurer’s offer is reasonable or not, they will need a valuation of their own for comparison.

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The consumer is usually pitted between the insurance company’s need to minimize their losses and the repair facilities need to make a profit. Today many repair facilities and insurance companies have established mutual relationships similar to a HMO/PPO referred to as “DRP” or “Direct Repair Programs” whereas the repairers adhere to insurer mandates in exchange for continued referrals. These mandates are to keep repair costs low and may restrict proper repair techniques, materials and processes. Far too often these DRP relationships have the repair shop working for the insurer and not you or in your best interests. In most cases it is best to seek a truly independent repairer, of your own selection, (based upon recommendations from those you know and trust) who will work for you in the proper restoration of your vehicle. If it is a DRP shop than ensure that they understand it is you whom they work for in the repair of your vehicle. If needed, get it in writing! Most state laws mandate that the choice of repairer is yours and yours alone. Don’t trust others to make such important decisions with your economic and personal welfare.

The consumer may need an unbiased third party Professional Expert to assure that such circumstances do not short change them in the recovery of their losses owed them under their policy and/or the law.

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Determining if a vehicle should be repaired or not depends on the economic factors surrounding the claim as well as state mandates and regulations designed to protect consumers.

As a general rule, when the damages meet or exceed 80% of the damaged vehicle’s pre-loss market value the vehicle will be considered a total loss. Insurers may elect to total a vehicle prior to reaching this percentage and it is rare that they would exceed it.

The insurer is given the liberty to make the decision to repair or replace (within state laws and guidelines) and once determined, the insurer is held to certain standards in their performance of their selected option. In either option, the consumer is to be indemnified for their loss and placed as closely as possible to the economic position they were just prior to the loss.

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Based upon past case history, the court has stated that an insurance claims adjuster has no affirmative obligation to advise an insured or third party claimant of their rightful entitlements; however when an adjuster provides information to a claimant about the claim, the adjuster must be truthful. As “Buyer Beware” is aged and sound advice for a buyer, the same adage may be appropriate for exercising caution when one is making a claim against an insurer.

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DV FAQ (20)

This would depend greatly upon the nature and severity of the damages sustained and the manner and quality of the repair performed as well as the vehicle itself and history of prior damages etc. Minor damages such as merely a damaged tail light or chrome bumper may be properly replaced with factory replacement parts whereas little if, any evidence of repair would be found even by the most experienced professional.

A vehicle which has sustained major damages, even after receiving the best possible repair, will not only have a history of being damaged but most often will have remaining signs of repair which will be easily noticed by a professional (i.e. car dealer at trade in, post repair inspector, potential buyer etc.). Such remaining indicators will cause a loss in value and may pose remaining safety related flaws and defects as well.

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The loss in value of a damaged vehicle is known as Diminished Value. The amount of Diminished Value of a damaged and repaired vehicle depends upon several factors including: the pre-loss value of the vehicle, the nature and severity of the damages and the cost, manner and thoroughness of the performed repairs.

Consider that, when a vehicle is in an accident, it loses its greatest value just after the actual impact or occurrence. During the dismantling, repair, installation and painting of replacement parts, the value is slowly restored as the repairs progress.

The full original value will likely never be regained simply because the vehicle now has a history of damage that it did not have before the loss. Prior damage history will be disclosed to potential buyers who will likely not pay the same for a vehicle with a damage history as compared to one with no damage history. This is often referred to as “the damaged goods syndrome”.

If the repairs are done thoroughly and in a workmanlike manner, the value of the vehicle can be maximized to the best of reasonable human ability but likely never to its pre-loss value.

If the repairs are done to less than thorough and workmanlike standards, the recovery in value will be limited accordingly, and the vehicle will suffer a greater loss or diminishment in value.

The more significant the damages, the greater the loss in value. The poorer the repair quality, the less recovery of the vehicle’s original and pre-loss value.

In order to make this determination you should secure the services of an independent professional to perform a visual inspection of the vehicle and prepare an expert assessment of your remaining loss.

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Under most state laws, every auto dealer is to disclose an accident history on a vehicle to a potential buyer. To be in compliance, and avoid lawsuits, they are often careful to ask regarding the damage history from the prior owner and may even have the owner sign an affidavit. After disclosure, most buyers are not willing to pay the same amount for a vehicle with an accident history as they would for the same vehicle without an accident history.

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Loss of Value or Diminished Value is the difference in the market value of a vehicle without an accident history and the market value of the same vehicle with accident history. Unlike depreciation, which is an anticipated and predictable loss in value incurred over time, Diminished Value is an unexpected and sudden loss in value due to a specific occurrence. This loss may be recovered as part of a property damage claim.

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First of all, the most important and easily overlooked aspect of performing a proper and thorough Diminished Value Assessment is the manner and thoroughness of the actual repairs performed. This is why Internet based evaluations without actual vehicle inspections are not considered to be accurate or recommended by respected industry professionals or likely to be admissible as evidence if needed. A comprehensive and accurate Diminished Value inspection will provide a two or three-dimensional approach whereas the site-unseen Internet valuations are merely one dimensional.
Secondly, these sight-unseen Internet valuations do not provide an unbiased valuation of the vehicle’s pre-loss condition which is one of the fundamental basics required to perform an accurate diminished value assessment. It would compare to your purchasing a vehicle sight un-seen.

These Internet based reports provide only an estimated valuation of the Inherent Loss in Value and provides no source to evaluate the manner, thoroughness or quality of the performed repairs and parts nor any further loss in value resulting from same.

Without physically inspecting the vehicle it would be impossible to evaluate the performance of both the insurer (Insurance Related Diminished Value) and/or repairer (Repair Related Diminished Value) in the repair of the vehicle, and one would likely not receive full compensation for their full remaining loss.

Thirdly, many of these Internet Diminished Valuation services utilize what is known as the “Georgia” or “17C Formula”. This formula was developed by insurers and originally adopted by the State Of Georgia as one means of attaining a value after Georgia adopted the premise that Diminished Value could be claimed by first party insured’s. However, as this formula was contested by consumer advocates the state agreed that the formula was not accurate and they promptly divested themselves from endorsing the formula. Many insurers continue to attempt to utilize this formula in their settlement offers despite the State Of Georgia’s change in position. While Internet based DV assessments may be less costly, you may not get the full scope of your damage and repair thus one may lose significantly more than one might save.

More importantly, there is no physical inspection of the repaired vehicle to determine if serious safety related issues may be present and remain in need of correction.

Consider the fact that during the manufacture of a vehicle there is an average of 600 visual inspections during the manufacturing process.  Wouldn’t it make sense that after re-construction from accident related damages that at least one visual inspection would be prudent?

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As a result of damages sustained in a covered loss and a claim made against an insurer, the insurer is obligated to provide for either the repair or replacement of the damaged property.

Normally the insurer is given the authority to make the decision to either repair or replace the damaged property. Once they make the decision they are held to a level of “pre-loss” condition and/or “actual cash value” (ACV).  Should the insurer elect to repair a damaged vehicle, they owe the costs to restore the damaged vehicle to its pre-loss condition to the best of reasonable, human ability.

Should the insurer elect to deem the damaged vehicle to be a total-loss, they are obligated to provide replacement or actual cash value enabling the claimant to purchase another vehicle equal to the value of the damaged vehicle, immediately prior to the loss. The rules of indemnification are clear in as much as what is owed is what was possessed just prior to the loss, no better and no worse.

Additionally, you may be entitled to sales tax, tag and title transfer costs in the event your vehicle is determined to be a total loss.

You may be entitled to ‘loss of use’ (temporary substitute vehicle) during the time required to make repair; or, seek a replacement vehicle from the at-fault party, their insurer, or as may be provided by coverage within your personal insurance policy.

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If you make a claim against your own insurer it is considered a first party claim and you will be dealing with your insurance company based on the terms and conditions as outlined within your insurance (contract) policy.

If the accident was someone else’s fault and you are making a claim against them through their insurer, it is considered a third party claim. You are under no contractual obligation to let the other person’s insurance company inspect the damages or determine the extent of damages or cost of repair. You may, if desired, secure repairs and merely submit a bill to the at-fault party and/or their insurer for reimbursement. The at-fault party’s insurer will likely provide for your damages based upon the ‘limits of liability’ coverage under the at-fault party’s insurance policy.

It’s important to understand that the at-fault party owes you for your damages and while their insurer owes them under the terms of the property damage portion of their policy contract, the at-fault party’s insurer legally owes you, the victim, nothing. The insurer will normally attempt to settle the claim on behalf of their insured as is owed to their policyholder under the terms of their insurance policy.

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The key to recovering all losses owed is to know just what it is that is owed you. Having an in depth visual inspection of the damaged/repaired vehicle and accurate assessment of your remaining damages prepared for you and understanding the necessary steps in the recovery process in paramount. Providing a detailed report with your claim will enable the insurer a clear understanding of your remaining loss and facilitate a more timely settlement.

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YES. Vehicle owners have the right to disagree with any assessed amount of loss. Depending on the policy and state law, provisions are provided for dispute resolution. Of course before one can make a determination if the insurer’s offer is reasonable or not, they will need a valuation of their own for comparison.

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It is important to completely inspect the vehicle when it is delivered but often the average consumer cannot see all remaining damages, flaws and defects. If you are unsure we strongly suggest you hire an independent appraiser to perform a post repair inspection – any flaws or defects in repairs after an accident or “evidence of repairs” can negatively affect your trade-in or resale value. Remaining safety related issues may also go unnoticed and uncorrected placing occupants and others on the roadway in possible jeopardy.

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The consumer is usually pitted between the insurance company’s need to minimize their losses and the repair facilities need to make a profit. Today many repair facilities and insurance companies have established mutual relationships similar to a HMO/PPO referred to as “DRP” or “Direct Repair Programs” whereas the repairers adhere to insurer mandates in exchange for continued referrals. These mandates are to keep repair costs low and may restrict proper repair techniques, materials and processes. Far too often these DRP relationships have the repair shop working for the insurer and not you or in your best interests. In most cases it is best to seek a truly independent repairer, of your own selection, (based upon recommendations from those you know and trust) who will work for you in the proper restoration of your vehicle. If it is a DRP shop than ensure that they understand it is you whom they work for in the repair of your vehicle. If needed, get it in writing! Most state laws mandate that the choice of repairer is yours and yours alone. Don’t trust others to make such important decisions with your economic and personal welfare.

The consumer may need an unbiased third party Professional Expert to assure that such circumstances do not short change them in the recovery of their losses owed them under their policy and/or the law.

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Determining if a vehicle should be repaired or not depends on the economic factors surrounding the claim as well as state mandates and regulations designed to protect consumers.

As a general rule, when the damages meet or exceed 80% of the damaged vehicle’s pre-loss market value the vehicle will be considered a total loss. Insurers may elect to total a vehicle prior to reaching this percentage and it is rare that they would exceed it.

The insurer is given the liberty to make the decision to repair or replace (within state laws and guidelines) and once determined, the insurer is held to certain standards in their performance of their selected option. In either option, the consumer is to be indemnified for their loss and placed as closely as possible to the economic position they were just prior to the loss.

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Based upon past case history, the court has stated that an insurance claims adjuster has no affirmative obligation to advise an insured or third party claimant of their rightful entitlements; however when an adjuster provides information to a claimant about the claim, the adjuster must be truthful. As “Buyer Beware” is aged and sound advice for a buyer, the same adage may be appropriate for exercising caution when one is making a claim against an insurer.

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Your ability to recover Diminished Value may depend on who was at fault, depending on various factors. There are two entirely different grounds for recovering the loss in value which apply depending on your status as either a first party or a third party claimant. First parties are usually seeking recovery of their damages from their own insurance company, whether the insurer pays for Diminished Value depends upon the terms of the insurance policy and the state’s interpretation of that policy and perhaps the insurer’s activities during the claim process. Third parties usually seek damages from the at-fault driver and/or their insurer for the loss in value as part of the property damages caused by the negligent driver. Most states allow for such recovery against the negligent party under what is known as ‘Reinstatement of Torts’.

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The term “No-Fault” generally refers to claims for injury and not necessarily property damage issues. In most states the “Reinstatement of Torts” is the rule followed whereas the at-fault party is responsible for all financial damages caused to another resulting from their negligence which may include Diminished Value.

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Yes.  If the accident was not your fault, it is owed to you from the insurance company of the at-fault party or your insurance company under your uninsured motorist’s coverage.

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Most certainly not.  The insurance company is telling you that because they don’t want to pay the claim.  Inherent diminished value is the automatic loss in value from a collision.  The vehicle is worth less because it is not what it was before the accident.

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No again.  Insurance companies have avoided paying these claims for years.  They do and say whatever will justify their position.  Diminished value and case law supporting the same has been around for nearly 100 years.

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Yes.  The insurance industry hopes you think not.  They save millions of dollars a year by avoiding payment on these claims.  Most people that are persistent in pursuit of their losses end up collecting.

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The answer is yes.  Without a diminished value report and post repair inspection you have not substantiated the claim.  As the claimant, you have the duty in most states to prove any claim you make.

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Collision Repair FAQ (8)

No matter how minor, it is wise to report every accident to the police. Then, contact the collision repair shop of your choice. Your independent collision repair shop can assist you with the processing of your claim, answer your questions, and advise you to ensure safe and proper repairs are made to your vehicle restoring as much value as humanly possible.

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No. If you request it, your insurer must inspect the damage to your vehicle at your chosen collision repair shop rather than at their drive-in claims center. They are legally prohibited from coercing or using any tactics intended to prevent you from seeking damage appraisals from your own body shop rather than their drive-in facility.

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No. In most states, including Florida and Oregon, you have the absolute right to select the collision repair facility of your choice. If the insurer gives you a list of ‘recommended repair shops’, they likely will have indicated repair shops which have entered into a contract with them. These shops may see the insurer as their customer, not you, the vehicle owner. These agreements may determine how your vehicle will be repaired and may encourage the use of non-original aftermarket replacement parts or call for shortcuts and other cost saving activities. By choosing an insurance preferred or referral shop, you may be giving up your rights in the proper and thorough repair process.

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Steering is the act of directing an insured and/or claimant to, or away from, any specific repair shop or requiring that repairs be made by a specific repair shop or individual. Steering by insurance companies can be subtle to extremely aggressive and is considered an unlawful practice in some states.

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If you are told that; “It will take longer to get your car repaired” or “cost more if you choose your own shop”, BEWARE.  You are probably being steered.  Statements such as “You’ll have to pay the difference out of pocket”, “We won’t guarantee the work if you take the car there,” or “We won’t pay the difference” are misleading and intended to scare you into taking your vehicle to a repairer of the insurer’s choosing.  The choice of repairer is yours, use it wisely!

Many states have consumer protection laws that require insurance companies to expedite appraisals within specific time frames. Insurance companies are required to perform accurate investigations and assessment of damage and to negotiate in good faith with any collision repair facility on the proper cost to repair the vehicle to pre-accident condition. You pay insurance premiums and contract to pay a specific deductible in the event repairs are required. In effect, you’ve already paid for proper repairs. Don’t be intimidated.

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Imitation parts (a.k.a. generic, aftermarket, ‘quality replacement’ or non-original equipment manufacturer (non-OEM), ‘Taiwan Tin’, ‘Off-shore sheet metal’, ‘Counterfeit’, etc.) are “knock-off” copied parts made by a company other than the manufacturer of your vehicle. These parts are made to look like your vehicle’s parts, but have likely never been crash tested and are not covered under your vehicle manufacturer’s warranty. In its February 1999 issue, Consumer Reports published the results of its extensive study of non-OEM parts. The cover story was entitled, “Shoddy Auto Parts: How to beat car repair rip-offs, Bumpers that shatter, Parts that don’t fit, Fenders that rust”.

In addition to these concerns, there are no provisions for recalls based on the safety or performance (or lack thereof) of these parts. Your insurance company may attempt to use imitation parts to save money on your vehicle’s repair. An independent collision repair facility will help you negotiate with your insurance company for the appropriate original equipment manufacturers parts to maintain the integrity and value of your vehicle and safety of you and your family.

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There are compelling reasons to choose an independent, trusted repair shop that you know will make sure the vehicle is truly restored to its pre-accident condition to the best of human ability. Insurance appraisers work for the insurance company. Truly independent auto collision repair facilities work for you. They are looking out for your best interest. They will negotiate directly with the insurance company for the proper repairs on your behalf so that your vehicle is safe for you and your family. Independent collision repairers look out for your best interests and will serve as your advocate during the repair process.

‘Preferred’ or ‘Direct Referral repair shops’ represent the insurance company in both negotiations and the repair of the vehicle. They contract with insurance companies regarding the repairs, the costs and the repair procedures in exchange for the insurer having damaged vehicles steered to them. The insurance company sets the rules and the repair shop simply follows them to keep the insurance companies sending them work. Better is never cheaper and cheaper is never better! These “relationships” between the insurer and repairer may affect the quality and thoroughness of the repair service and/or the quality and condition of the parts used. You have paid your insurance premiums with the expectation of receiving safe and proper repairs that truly restores your vehicle to its pre-loss condition to the best of human ability. Make sure you get what you’re entitled.

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The repair facility is responsible for the workmanship.  Insurance companies do not repair automobiles therefore they cannot extend warranties for repairs.  If there is a concern, even with a facility selected by the insurance company, the facility itself is responsible.  Ask your local independent repair facility for their warranty, in writing.

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Appraisals FAQ (15)

An appraisal is a service whereas a professional appraiser, proficient in the particular field, evaluates the subject property and prepares a formal assessment whereas an opinion of value is rendered. Vehicle Value Experts currently provides appraisals for various types of vehicles (i.e. cars, trucks, motor homes, travel trailers, motorcycles etc.) and services including, but not limited to:

  • Appraisal Clause Activities (insurance policy contract claim resolution)
  • Appraisal of Physical Damage/Correction (auto body repair, cosmetic repair, insurance claim)
  • Value Assessments (i.e. classic, custom, exotic value etc.)
  • Total-loss Replacement Valuations (pre-loss Actual Cash Value (ACV), Salvage Value etc.)
  • Estate Liquidation/Settlement Valuations
  • Insurance Coverage, (Stated value, Appraised value, Replacement value etc.)
  • Dissolution of Marriage (Divorce) Property Settlements
  • Bankruptcy Proceedings, (Chapter 11 reorganization, Chapter 7 liquidation etc.)
  • IRS Tax issues, (Donated vehicle, casualty loss deduction, depreciation etc.)

Real estate, fine jewelry, and art are among the most common items appraised. A motor vehicle appraisal is conducted much like other types of valuation appraisals whereas a qualified expert thoroughly inspects the subject vehicle, performs market research and opines to its monetary value range. The opinion rendered may not be the same by each and every appraiser as the appraised value is the expert opinion of the assigned appraiser and is based upon his interpretation of the vehicle’s condition, research and findings.

One needs be cautious in their selection of an appraiser to ensure competence. While in some instances the costs associated with the appraisal process may be recoverable, a basic rule to consider when seeking a qualified and competent appraiser is, not to base your selection of an appraiser on lower pricing. Remember: “Cheaper is Rarely Better and Better is Rarely Cheaper!”

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An automotive (vehicle) appraisal is utilized to aid in establishing the value of a particular vehicle for a specified period of time. The appraisal may be used to certify a vehicle’s value to secure a loan, obtain-renew or update insurance coverage, meet IRS and/or help resolve a legal issue (donation, bankruptcy, divorce, estate liquidation etc.), to ascertain diminished value, and/or determine a vehicle’s pre-loss value when negotiating a total-loss recovery.

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An appraisal may be desired or required for various reasons including, but not limited to:

  • Verifying the condition of a vehicle prior to lease turn-in (no damage or if damaged, the reasonable cost of repair [Repair Assessment])
  • Valuation for true “residual value”
  • Determining a fair replacement value of a vehicle determined to be a total loss,
  • Establish loss (diminution) in value due to accident damages

Insurance policy contracts may have an “Appraisal Clause” which calls for both parties to secure the services of independent appraisers to aid in settlement of claim disputes. Vehicle Value Experts offers its services to all parties which enables us to help our clients regardless if an insurer, consumer, legal professional, corporate or state official. Vehicle Value Experts offers a true balance of clientele which ensures fair and unbiased activities which many professionals (who only serve either defendants or plaintiffs) cannot attest to.

In some instances, an appraisal may be required to obtain documentation to support an IRS deduction, valuation of a donation, value for adequate insurance coverage, collateral, legal requirements (i.e. bankruptcy, divorce, estate settlement) and other various issues.

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Most any property can be appraised. Our Vehicle Value Experts have been called upon to appraise various vehicles including RVs, motorcycles, even trailers and other personal property and for many various reasons. Contact us with your specific issue for a no obligation consultation to see how we can best help you!

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The timing for having an appraisal done would depend upon the particular matter and any requirements. One needs to be cautious of issues such as court orders, IRS mandates, Insurance policy and/or contract wording and any statutes of limitations. Requirements often depend upon the need and the party requesting the appraisal. Should your particular issue involve a matter of the past, you may elect to seek a valuation for the property’s “pre-loss value” (as it was at the time of the loss) which can be much greater than that at a later date.

If your vehicle is in various stages of customization or restoration, you may be wise to have it appraised during the restoration in the event it is damaged or stolen before being completed. A vehicle may be worth tens of thousands of dollars prior to completion and it would behoove an owner to have it appraised during the investment process (mechanical, interior, body repair and refinishing etc.). This would be especially true when transporting the vehicle to a service provider whereas the vehicle will be in the care, custody and control of another. Possessing a current valuation and having adequate coverage will protect your investment and give you the peace of mind insurance is intended to provide.

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Generally, most lease contracts stipulate the vehicle to be appraised no more than one month (30 days) before expiration of the lease agreement. The intent is to determine the subject vehicle’s “Fair Market Value” so the consumer and the lesser are better prepared to negotiate lease termination, residual buy-out, defending against miss-apportioned physical damages etc. to aid in obtaining a fair and equitable end of lease settlement without unwanted and unwarranted surprises for either party.

In the case of an early termination, it’s best to have the appraisal performed just prior to actually turning the vehicle in to ensure that all issues are recognized and resolved beforehand. There’s nothing worse than receiving notice weeks after turn-in advising hundreds, or even thousands of dollars in damages/repairs are owed which can no longer be verified! Most all Vehicle Value Experts appraisals will have accompanying documenting photographs to avoid such hidden and unexpected surprises.

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The need for an appraisal when donating a vehicle would depend upon the circumstances. Under current IRS guidelines (at the time of this writing), when a private party makes a donation of a vehicle valued at $5,000.00 or more, there are several requirements including but not limited to:

  • Obtaining a written appraisal by a qualified appraiser
  • The appraisal be prepared no less than 60 days before the contribution
  • The maximum deduction allowed is the vehicle’s “Fair Market Value”
  • The charity is a qualified organization
  • Your deduction cannot exceed 50% of your gross Income
  • Note that “Fair Market Value” may be considerably less than “Book Value”

While not mandatory, an appraisal of a donated vehicle valued at less than $5,000.00 is considered prudent.  For additional information in this regard you may wish to visit: http://www.irs.gov/pub/irs-tege/pub4303.pdf

NOTE: Vehicle Value Experts does not provide legal or financial advice and suggest that should such counsel be desired that the IRS and/or a qualified professional familiar with such matters be contacted. For further clarification regarding the use of this site please visit our “TERMS AND CONDITIONS”.

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Yes! Vehicle Value Experts has performed hundreds of appraisals and because they meet all IRS certified appraisal requirements none have ever been questioned, declined or found to be unqualified. We adhere to and meet all Professional Automotive Appraisal Standards (e.g. USPAP-Uniform Standards of Professional Appraisal Practice) throughout the nation for local, state and national appraisal activities for various applications. Vehicle Value Experts doesn’t merely offer a multitude of services; we provide confidence and peace-of-mind!

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An accurate appraisal begins with a consultation with the subject vehicle’s owner or representative to ascertain relevant information (i.e., specific needs, instruction etc.) followed by a thorough inspection of the subject vehicle by a qualified expert. The intent of the inspection is to determine its overall condition regarding function, appearance, equipment (factory and/or custom) maintenance (original, restoration, customized etc.) along with damage history and other information as may be pertinent to establishing its overall value.

Then a market search is conducted to determine the actual “Fair Market Value” to ascertain what other similar and comparable vehicles to the subject vehicle will command in the same general marketplace as possible (with appropriate deductions and additions whereas applicable).

A “Book Value” is then determined using various accepted published value guides (i.e. NADA (National Auto Dealers Association, Black Book, Kelly Blue Book, CPI- Cars of Particular Interest etc.).
A report of the research findings is then prepared, customized to the specific needs of the client and certified to permanently record the acquired information. Copies of the information are retained for a limited period of time (normally 1 to 2 years) to Vehicle Value Experts you further should the need arise.

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“ACV” is an acronym for the term Actual Cash Value. As the term suggests the “Actual Cash Value” is the price of a vehicle that one could buy for cash at a specific time-frame. ACV is often computed by determining its “Replacement Cost” (RC) or the cash price required to buy an identical item and then adding for enhancements and/or by subtracting for depreciation based on age and condition of the property to be replaced to render a fair and accurate value for settlement purposes. One example may be; the cost of new plus or minus appropriate adjustments.
In the property and casualty insurance industry, “Actual Cash Value” or ACV is a term for the method of valuing insured property by determining the cost of repairing or replacing damaged property with other of like kind and quality (LKQ) and in the same physical condition; replacement cost less physical depreciation based on age, condition, time in use and obsolescence. Depreciation is based on age and condition.

Example: Let’s say you bought a new television five years ago for $600. Could you sell it for the same $600 today?  Of course not, it may be worth only $150.00.  If your television was stolen or damaged, that $150 is all you would get from the insurance company with an actual cash value (ACV) policy.

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“Book Value”, in relation to automobiles, is value guides published listings (in print, data and/or Internet) and pricing of automobiles provided by independently owned and operated auto valuation organizations such as the National Auto Dealers Association (a.k.a. NADA) and Kelley Blue Book (KBB) Black Book, and Cars of Particular Interest (CPI) etc.
Such publications are generally well known, recognized and accepted by the automotive and financial sectors as guides and references for automobile pricing.

These reference guides normally offer several levels of pricing which may include manufactured suggested retail pricing (MSRP), retail, wholesale, loan etc. Additionally these value guides generally provide for methods in determining the economic impact (deductions or additions) for such factors as model packages (i.e. Limited, Touring etc.), condition, mileage, optional equipment etc.

It’s important to note that relying merely on a “Book Value” may not provide the basis for a fair and reasonable valuation of a vehicle’s value whereas, market conditions oftentimes play a direct and significant affect on a vehicle’s value at any given time or location. As an example; whereas a richly equipped high performance and/or massive gas guzzler may be significantly devalued in the marketplace during a time when gasoline prices increase significantly; at the same time, a small gas miser, with few amenities, may command a price much greater than a guide book’s listed retail value. This is known as market impact or market conditions which can and oftentimes do have a direct effect on a vehicle’s ”Fair Market Value” or true value.

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Simply stated, “Comparable Value” is a measurement of worth based on the selling price of a similar item. Oftentimes comparable or “Comp” values are sought to aid in determining the value of a vehicle. Comp values are attainable through various resources including, but not limited to local, regional and national print, Internet and by consulting sales professionals.

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“Fair Market Value” (FMV) is the price at which a property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts.

Fair Market Value is a term in both law and accounting that is based on the economics term of “market value.” It is also a common basis for assessing damages to be awarded for the loss of or damage to property, generally in a claim under tort or a contract of insurance.

Fair Market Value is a judgment established by market research of similar vehicles (a.k.a. “comp”) in a specific market region during a given time frame. The goal is to determine at what price the subject vehicle would have sold for at a specific time in a given geographical area.

Vehicle Value Experts employs various recognizable and reliable resources in locating comparable vehicles to effectively ascertain a vehicle’s true Fair Market Value regardless of how unique the property may be.

Vehicle Value Experts offers decades of experience and commitment to excellence and provides its clients with the information they require when it is needed.

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“Replacement cost” or Guaranteed Replacement Cost is the current price of a like-kind vehicle if it were to be purchased new, as opposed to the depreciated value of the vehicle at the time of the loss.

“Replacement Cost” takes into consideration the increase in the pricing of a vehicle. It is conceivable that over time, a fully and properly restored classic vehicle, providing it was maintained properly, would increase in value. Should a vehicle be insured under a “Replacement Cost” policy, and be stolen or destroyed, the owner would receive the cost to replace the vehicle at the time of the covered loss.

In the insurance industry, “replacement cost” is relative to a insurance policy provision which pays for the full cost of replacing damaged property without a deduction for depreciation and without a dollar limit. This policy is different from an actual cash value policy, which takes into account depreciation for lost and damaged items, if the damage resulted from an insured peril.

Whereas depreciation is an anticipated loss in value based on age and condition, appreciation is an increase in the market value of a property due to changes in market conditions or other causes, especially over time. Appreciation is the opposite of depreciation.

Example: Suppose you bought a new television five years ago for $600 and it was stolen or destroyed in a fire. With a “Replacement policy, If your television was stolen or damaged beyond repair you would receive the amount necessary to buy a replacement like, kind quality television at the current market price, which may be more or less than the original $600.00.

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A physical inspection of the vehicle, by a qualified expert, is the only effective method by which to ascertain the true condition of a vehicle as would be necessary to assess an accurate value which can be certified by an expert and accepted by a third-party. It would be like to purchasing a vehicle by mere photos without inspecting it or securing a Pre-Purchase Inspection (PPI).

Contact us to discuss your specific needs and what service(s) are best suited for your particular situation.

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