Insurance value vs market value question

[AZjeff]

I'm loaning the 2007 Fusion to daughter for a while to help her out. I was curious about getting full coverage on it while it's out of my control and found out State Farm says it's worth $2200 but the market on the car in the condition it's in is $5-6k all day long. Obviously it wouldn't take much to total it but my question is if there was an accident can a case be made to State Farm for the market value being $6000 and getting that amount not $2200? The difference in the yearly premium is around $150 from liability only to comprehensive so it's worth doing.

 

[Ed_Flecko]

Where are they getting their "value" from? Kelly Blue Book?

I have a similar situation. I have a 2001 Volvo S-40 with 58K miles and had every option available when we bought it. KBB says it's worth $2,000-$2,500 but I have seen people selling cars like mine for $5,000-$7,000 all day long, depending on the condition.

If I were you, I'd happily spend the extra $150...I think that's a deal you should take advantage of!

Ed

 

[F150]

Try an get an Agreed upon value policy. This is done on boats I know, not sure about an Auto liability policy.

 

[GSCJR]

if there was an accident can a case be made to State Farm for the market value being $6000 and getting that amount

Yes. I asked my insurance company rep, this very question when I was rear ended in my 2007 Maxima. YMMV.

 

[SC Maintenance]

Paging @Owen Lucas

Going through this now on an actual claim for my daughter.

First they will significantly undervalue it using a industry specific software using the cheapest crappiest comps they can find.

Then they will discount there already low comps saying you can negotiate far lower than the listed price.

You can hire your own appraiser but I am finding that to be difficult. Maybe its better where you are.

 

[Cujet]

Allstate paid exactly half of my totaled F150's replacement value. I dug my heels in, hired a lawyer, kept on them. Nothing worked. In fact they tried to not pay at all due to time elapsed.

In the end I had a lawsuit with the dump truck company and won. Allstate was their ins company too. In a long and convoluted way Allstate ended up paying exactly what they should have in the first place. Plus my lawyer fees. But they only paid because the dump truck company hired a wildly incompetent driver who never had a drivers license of any kind from any country.

 

[Owen Lucas]

I'm loaning the 2007 Fusion to daughter for a while to help her out. I was curious about getting full coverage on it while it's out of my control and found out State Farm says it's worth $2200 but the market on the car in the condition it's in is $5-6k all day long. Obviously it wouldn't take much to total it but my question is if there was an accident can a case be made to State Farm for the market value being $6000 and getting that amount not $2200? The difference in the yearly premium is around $150 from liability only to comprehensive so it's worth doing.

DM me you VIN and odometer and I'll run some numbers. I'll assume Phoenix for the zip.

But yes, if my value comes to $6k based on actual comps and not cherry picking, CCC, State Farm's valuation software, will likely come in at $4k maybe a tad more.

 

[methusaleh]

I’m not sure if it’s only for collector cars, but my classics are insured with Hagerty and have been for over ten years with no problems.

I declare a dollar value, send photos of receipts and work done, and they approve it. I’ve never been denied an increase in coverage. And somehow either myself or my insurance broker negotiated unlimited annual mileage for actually driving the vehicles— not that I ever come close to even 1000mi a year for any of them.

 

[K2K2]

I'm loaning the 2007 Fusion to daughter for a while to help her out. I was curious about getting full coverage on it while it's out of my control and found out State Farm says it's worth $2200 but the market on the car in the condition it's in is $5-6k all day long. Obviously it wouldn't take much to total it but my question is if there was an accident can a case be made to State Farm for the market value being $6000 and getting that amount not $2200? The difference in the yearly premium is around $150 from liability only to comprehensive so it's worth doing.

Yes. I was an insurance guy for several years.

If there's coverage, they'll owe you replacement value not some book price. SF has a reputation for lowballing so never accept their first offer.

Insurance is required to "make you whole" aka replace your vehicle with same.

Get 3 examples of the same vehicle - miles, interior, engine, transmission, condition, color if you can - and send those to your adjuster. They will likely try to pooh pooh your submissions. Mention "good faith" and "make whole" and if those phrases don't work, let them know you'll be sending them your attorney's contact information.

Last resort is court, where the law will prevail; but they'll usually cave long before things get that far.

If the accident does occur don't hesitate to send me a PM with any questions.

 

[Owen Lucas]

Last resort is court, where the law will prevail; but they'll usually cave long before things get that far.

Invoking the appraisal clause in the policy works 99% of the time and likely more successful than an attorney. Most attorney retainers now are $2500 and they do not have the appraisal knowledge to write an accurate valuation. Yes they can force feed a number to the adjuster, but then they take a 30% cut which defeats the whole point of disputing the value. Not many specialize in this field, there is not much money in it.

This is where a licensed and experienced appraiser comes into play. We know the ins and outs of appraising and disputing values for a fair market value, not the highest value via cherry picking, but based in facts and market realities.

Of course the insurance companies independent appraiser will also try to low ball, usually not as bad as a CCC report, and the insured appraiser will try to come in a little high, usually a decent middle ground is reached. When the 2 appraisers come to an agreed value it overrides the CCC / Mitchell report. The insurance adjuster updates their file and the customer is paid out fair market value.

Get 3 examples of the same vehicle - miles, interior, engine, transmission, condition, color if you can - and send those to your adjuster. They will likely try to pooh pooh your submissions. Mention "good faith" and "make whole" and if those phrases don't work, let them know you'll be sending them your attorney's contact information.

That's the issue with comps, the adjuster doesn't actually update the file or do any manual work. They send the comps to CCC which either updates the report or declines them. The comps could be perfect but they rarely add value unless there was a major screw up on the report, which happens occasionally.

 

[fdcg27]

The insurer owes you for the replacement cost of a comparable vehicle.
In the case of an at-fault driver's insurer trying to low-ball you on value, you can always subjugate the claim and let your insurer handle the other party. You'll get paid.
Document the car's condition and mileage with time stamped photos.
A good Fusion with under 50K, that IIRC was gifted to you by the original owner has to be worth a great deal more than the typical beater Fusion pushing twenty years of age with 200K + on its fourth or fifth owner.This would have to be a $6-7K car and looks nice enough that it would likely appear on a reputable used car lot.
You might try for an offer from such a place, which would help to cement the claimed value for the car.

 

[MCompact]

I’m not sure if it’s only for collector cars, but my classics are insured with Hagerty and have been for over ten years with no problems.

I declare a dollar value, send photos of receipts and work done, and they approve it. I’ve never been denied an increase in coverage. And somehow either myself or my insurance broker negotiated unlimited annual mileage for actually driving the vehicles— not that I ever come close to even 1000mi a year for any of them.

Same here.

 

[Owen Lucas]

The insurer owes you for the replacement cost of a comparable vehicle.

They have their own opinion on what a "comparable vehicle" is.

Funny thing is many policies allow for the insurance co. to also purchase a replacement vehicle for you. Almost no one takes it up, and I've seen it happen only once, and they paid more for the replacement than they offered initially.

In the case of an at-fault driver's insurer trying to low-ball you on value, you can always subjugate the claim and let your insurer handle the other party. You'll get paid.
Document the car's condition and mileage with time stamped photos.

Going 3rd party is usually a take-it-or-leave-it scenario. If you have collision, you can at least invoke the appraisal clause.

Ins adjuster doesn't care about condition or or pictures etc, they mark everything as average.

 

[fdcg27]

They have their own opinion on what a "comparable vehicle" is.

Funny thing is many policies allow for the insurance co. to also purchase a replacement vehicle for you. Almost no one takes it up, and I've seen it happen only once, and they paid more for the replacement than they offered initially.

Going 3rd party is usually a take-it-or-leave-it scenario. If you have collision, you can at least invoke the appraisal clause.

Ins adjuster doesn't care about condition or or pictures etc, they mark everything as average.

No, you can subjugate and your insurer pays you while going after the other party's insurer.
You'll even get your deductible back, as my mother did when a Fedex van totaled her Accord.

 

[Nukeman7]

The insurer owes you for the replacement cost of a comparable vehicle.
In the case of an at-fault driver's insurer trying to low-ball you on value, you can always subjugate the claim and let your insurer handle the other party. You'll get paid.
Document the car's condition and mileage with time stamped photos.
A good Fusion with under 50K, that IIRC was gifted to you by the original owner has to be worth a great deal more than the typical beater Fusion pushing twenty years of age with 200K + on its fourth or fifth owner.This would have to be a $6-7K car and looks nice enough that it would likely appear on a reputable used car lot.
You might try for an offer from such a place, which would help to cement the claimed value for the car.

No, you can subjugate and your insurer pays you while going after the other party's insurer.
You'll even get your deductible back, as my mother did when a Fedex van totaled her Accord.

I think you mean subrogate, not subjugate! (Although you might want to subjugate the insurance company.)

 

[fdcg27]

I think you mean subrogate, not subjugate! (Although you might want to subjugate the insurance company.)

You are right.
Darn spell check!

 

[RBT]

Agreed value is generally not available for daily drivers, at least not where I live.

Take the collision off of it or just don’t declare accidents and repair it yourself if something happens.

The insurance companies try to haircut you no question but too many people think they have an old car in “pristine” condition when in reality it is far from it. The insurance appraisal serves as a dose of reality with respect to the value of old cars. Driving a paid off car is a savings in terms of depreciation and insurance cost but if it gets hit expect it to be totaled. Thats just reality.

 

[bullwinkle]

Agreed value is generally not available for daily drivers, at least not where I live.

Take the collision off of it or just don’t declare accidents and repair it yourself if something happens.

The insurance companies try to haircut you no question but too many people think they have an old car in “pristine” condition when in reality it is far from it. The insurance appraisal serves as a dose of reality with respect to the value of old cars. Driving a paid off car is a savings in terms of depreciation and insurance cost but if it gets hit expect it to be totaled. Thats just reality.

I have this issue with the Vue I bought not too long ago-last year of the manual, has a sub-100K replacement Ecotec engine, and is nearly rust-free underneath (although it does have the typical plastic body panel rattles). With the new tires, struts, & new front brakes I have ~$5K in it, but book is a paltry $2500, maybe.

 

[97prizm]

I'm loaning the 2007 Fusion to daughter for a while to help her out. I was curious about getting full coverage on it while it's out of my control and found out State Farm says it's worth $2200 but the market on the car in the condition it's in is $5-6k all day long. Obviously it wouldn't take much to total it but my question is if there was an accident can a case be made to State Farm for the market value being $6000 and getting that amount not $2200? The difference in the yearly premium is around $150 from liability only to comprehensive so it's worth doing.

I had full coverage on a Pontiac Vibe. It was hit and totaled. Farm Bureau said it was "only worth about $2k." I had to fight as similar vehicles were going for $3500-$4500. I had to take it to the head insurance adjuster and waste my day off

 

[Owen Lucas]

No, you can subjugate and your insurer pays you while going after the other party's insurer.
You'll even get your deductible back, as my mother did when a Fedex van totaled her Accord.

I think you mean subrogate. That doesn't mean the insurance company can give you a high value and just say the at-fault insurance co will just pay it.

Insurance can't value vehicles differently depending if ther eis subrogation potential, that would be an unfair claims practice AKA illegal.

The at-fault ins co doesn't have to pay 100% in subrogation either. The subro departments between insurance co's fight to reduce payouts and could very well say ins co 1 overpaid for the value and will only cover X amount + deductible. They don't sue over this stuff, maybe they go to arbitration but likely eat the difference.

Vehicles are valued through 1 method, CCC and for specialty vehicles through vendors. Same practice each time, as mandated by law.

Insurance companies have valuations and reimbursements all figured out, since the dawn of insurance over 400 years ago, they've been refining reduced payouts, denials, and profits.