Earlier this year I was in a bad car accident that yielded a total loss claim on my car. This was frustrating, because I did not completely understand why I received the payout I did and what my car was worth. Could I have gotten more money elsewhere? If you are in a similar situation, keep reading to find out whether you should take the insurance payout or look at some junk car buyers for a better rate.
How does my insurance company come up with my vehicle’s value?
Now this is a bit of a black box, as insurance companies all do it differently. However, the gist of the equation is as follows. They will thoroughly look over your vehicle, noting the damage from the accident as well as any other existing damage to come up with a base subtraction. Then they will compare local dealership prices for your car or other options for reselling your totaled car. The outcome of this equation is about the rate they will offer you. However, the software is not perfect and does vary between insurance providers. The software they use to look up local dealers is the most complicated, and may give different results.
How can I take advantage of this process and get a better deal?
So now that your car has been appraised, you’ll want to get a copy of the valuation. If you look over this, you may see some discrepancies — maybe they have marked your vehicle as the base version but you have an upgraded modal, or perhaps the rates they got from dealers are not correct. You may have to call around to local auto dealers to confirm the values. Make sure to get documentation for any differences you find.
Once you do your research and fact-check the insurance valuation, you’ll want to talk to your claim adjuster. Show them any documentation you have of incorrect appraisal. They may be willing to redo the offer and get you a better deal.
Are there more options if I still think my car is worth more?
This is where things may get complicated. You could ask for an independent appraisal, where you hire an appraiser, the insurance company hires one as well, and the two parties come together to come up with a valuation. This is not always a winning plan, though, as they could settle on a lower value than you’d originally gotten! Plus, you will have to pay for the appraiser.
The final option is to contact local junk car buyers, like Junk Car Traders, to see what they will offer you for the car. You may get lucky and get more for your money from someone like us than from your insurance company! It never hurts to be thorough when it comes to something as important as your car.