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  1. #1
    Join Date
    Mar 2016
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    18

    Default What is Reasonable Substitute Car Value During Loss of Use

    My question involves an injury that occurred in the state of: Texas

    Hi,
    i recently had a car accident and i was lucky:-) because other driver accepted his fault and his insurance company paid for my car repair. Thank you Insurance Company.

    But my car repair took about 20 days so i submitted Loss of Use claim to the same driver's at-fault insurance company and sent them multiple quotes from Avis.com and Enterprise.com showing rental value of the can similar to mine. The price was around 70$ per day so the total Loss of Use amount i claimed was around 1400$. The Insurance company returned to me and said that they owe me only rasonable transportation or equivalent so they can pay 30$/day maximum.

    I was trying to find how Loss of Use is calculated in such cases but so far it looks really non-transparent.

    In Pasadena State Bank v. Isaac, 228 S.W.2d 127 (Tex. 1950). it says: The plaintiff may prove and recover damages for loss of use of a repairable vehicle by establishing the reasonable rental value of a substitute car for the time reasonably required to repair or replace it.

    And in Mondragon v. Austin, 954 S.W.2d 191 (Tex. Civ. App. – Austin, 1997). : Proof of the reasonable rental value of a hypothetical substitute automobile is sufficient evidence to support an award for loss of use. Id.The owner doesn’t need to actually rent a replacement vehicle in order to recover loss of use damages. Furthermore, damages for loss of use of a repairable automobile are not limited a matter of law to the total value of automobile. Id.

    So i'm having troubles finding a good case that clearly states what is reasonable rental value. I assume it can't be the same if you're driving 20y old Toyota Camry or brand new Mercedes.

    Maybe you can point me to the right case where i can find the answer and can refer Insurance company to that case to get my 70$/day?

    Once again this id third party liability, and i'm requesting loss of use reimbursement from other driver's insurance company. So theoretically it shouldn't be any limits to the amount and legislation should prevail insurance company's internal policies. I guess:-)

    Thanks in advance for help

  2. #2
    Join Date
    Jul 2018
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    1,395

    Default Re: Loss of Use - Reasonable Substitute Car Value

    Quote Quoting ivasergey
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    But my car repair took about 20 days so i submitted Loss of Use claim to the same driver's at-fault insurance company and sent them multiple quotes from Avis.com and Enterprise.com showing rental value of the can similar to mine. The price was around 70$ per day so the total Loss of Use amount i claimed was around 1400$. The Insurance company returned to me and said that they owe me only rasonable transportation or equivalent so they can pay 30$/day maximum.
    Why would you submit quotes, as opposed to receipts or invoices? A quote is a proposal for something that hasn't been incurred, and you're not entitled to anything you haven't actually incurred. Did you actually rent a car for $70 per day? If the answer to that question is no, did you incur any costs for substitute transportation? If so, what costs did you actually incur?

  3. #3
    Join Date
    Mar 2013
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    16,951

    Default Re: Loss of Use - Reasonable Substitute Car Value

    I was going to ask the same thing that PG1067 asked.

    You can quote case decisions all you want but the only person they will mean anything to is a judge.

    You can either accept what the other driver's insurance company is offering or you can sue the other driver for the $1400 and convince a judge to say, yes, he owes you $1400.

    Meantime, "reasonable" is in the eye of the beholder and the liability adjuster's definition is what goes until a judge says otherwise.

  4. #4
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    Mar 2016
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    18

    Default Re: Loss of Use - Reasonable Substitute Car Value

    Quote Quoting adjusterjack
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    I was going to ask the same thing that PG1067 asked.

    You can quote case decisions all you want but the only person they will mean anything to is a judge.

    You can either accept what the other driver's insurance company is offering or you can sue the other driver for the $1400 and convince a judge to say, yes, he owes you $1400.

    Meantime, "reasonable" is in the eye of the beholder and the liability adjuster's definition is what goes until a judge says otherwise.
    i rented the car on week days and then returned it for the week-ends to save money (because i wasn't sure that insurance company will reimburse it to me).

    And in Mondragon v. Austin, 954 S.W.2d 191 (Tex. Civ. App. – Austin, 1997). it says : Proof of the reasonable rental value of a hypothetical substitute automobile is sufficient evidence to support an award for loss of use. Id.The owner doesn’t need to actually rent a replacement vehicle in order to recover loss of use damages.

    I understand that cases above mean something to judge. But i was hoping that adjuster will also take it into account.

    I was also thinking to go to Small Claims court and try to sue insurance company. Do you think i have strong position to recover $1400 or judge may also think that "reasonable" means somewhere between what i'm asking and insurance company is offering?

    Thanks

  5. #5
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    Oct 2016
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    Default Re: Loss of Use - Reasonable Substitute Car Value

    The insurance company would be the wrong entity to sue. If you sue you need to sue the driver that hit you.

  6. #6
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    Mar 2016
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    Default Re: Loss of Use - Reasonable Substitute Car Value

    Quote Quoting PayrolGuy
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    The insurance company would be the wrong entity to sue. If you sue you need to sue the driver that hit you.
    thanks. could you please clarify why?

    i read Texas Policy which is standard for Texas and Section 1 says:

    INSURING AGREEMENT
    1. We will pay damages for bodily injury or property damage for which any covered person becomes legally
    responsible because of an auto accident. Property damage includes loss of use of the damaged property.

    So i assume Insurance company is liable here and i can sue them

  7. #7
    Join Date
    Oct 2014
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    7,288

    Default Re: Loss of Use - Reasonable Substitute Car Value

    Quote Quoting ivasergey
    View Post
    i rented the car on week days and then returned it for the week-ends to save money (because i wasn't sure that insurance company will reimburse it to me).

    And in Mondragon v. Austin, 954 S.W.2d 191 (Tex. Civ. App. – Austin, 1997). it says : Proof of the reasonable rental value of a hypothetical substitute automobile is sufficient evidence to support an award for loss of use. Id.The owner doesn’t need to actually rent a replacement vehicle in order to recover loss of use damages.

    I understand that cases above mean something to judge. But i was hoping that adjuster will also take it into account.

    I was also thinking to go to Small Claims court and try to sue insurance company. Do you think i have strong position to recover $1400 or judge may also think that "reasonable" means somewhere between what i'm asking and insurance company is offering?

    Thanks
    First of all, the other driver's insurance company owes you nothing directly. Its obligation is to its insured — the other driver. The other driver is the one who damaged your car, so it is the other drive that you would have to sue. Second, if the other driver's insurance policy limits the payment for this to $30/day (and it's not clear from what you wrote if the insurer is saying that the $30/day is the policy limit or just what it thinks amounts to reasonable compensation) then the insurance is only obligated to pay the $30/day if you win a judgment against the other driver. The other $40/day would come out of the other driver's pocket.

  8. #8
    Join Date
    Mar 2016
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    18

    Default Re: Loss of Use - Reasonable Substitute Car Value

    Quote Quoting Taxing Matters
    View Post
    First of all, the other driver's insurance company owes you nothing directly. Its obligation is to its insured — the other driver. The other driver is the one who damaged your car, so it is the other drive that you would have to sue. Second, if the other driver's insurance policy limits the payment for this to $30/day (and it's not clear from what you wrote if the insurer is saying that the $30/day is the policy limit or just what it thinks amounts to reasonable compensation) then the insurance is only obligated to pay the $30/day if you win a judgment against the other driver. The other $40/day would come out of the other driver's pocket.
    Thank you and sorry that i'm asking so many questions - for now it looks like i have 0 chances in the court because i don't even understnd the basics:-)

    My understanding was that when i buy Liability insurance let's say from Geico that covers first 25 000$ towards damages and losses caused by me to other driver's property. So other driver can't even sue me unless they think the damage is over 25k and my policy won't cover it:-) That's why i was going to sue insurance company first. And honestly now i'm confused - Liability insurance is mandatory at least in Texas but from what you're saying it doesn't really protect me from liability and other people can still sue me. Why do i need it then?:-)

    30$ is how they estimate reasonable value. But it's hard to rent even Standard car for 30$/day including taxes and fees. Maybe Economy.

    Thanks

  9. #9
    Join Date
    Mar 2013
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    16,951

    Default Re: Loss of Use - Reasonable Substitute Car Value

    Quote Quoting ivasergey
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    i rented the car on week days and then returned it for the week-ends to save money (because i wasn't sure that insurance company will reimburse it to me).
    Then submit your receipts for reimbursement and see how it goes.

    Quote Quoting ivasergey
    View Post
    And in Mondragon v. Austin, 954 S.W.2d 191 (Tex. Civ. App. – Austin, 1997). it says : Proof of the reasonable rental value of a hypothetical substitute automobile is sufficient evidence to support an award for loss of use. Id.The owner doesn’t need to actually rent a replacement vehicle in order to recover loss of use damages.

    I understand that cases above mean something to judge. But i was hoping that adjuster will also take it into account.
    Then quote the cases to the adjuster and see how it goes.

    Quote Quoting ivasergey
    View Post
    i rented the car on week days and then returned it for the week-ends to save money (because i wasn't sure that insurance company will reimburse it to me).
    I was also thinking to go to Small Claims court and try to sue insurance company. Do you think i have strong position to recover $1400 or judge may also think that "reasonable" means somewhere between what i'm asking and insurance company is offering?

    [/QUOTE]

    Quote Quoting ivasergey
    View Post
    i rented the car on week days and then returned it for the week-ends to save money (because i wasn't sure that insurance company will reimburse it to me).
    Then submit your receipts for reimbursement and see how it goes.

    Quote Quoting ivasergey
    View Post

    I was also thinking to go to Small Claims court and try to sue insurance company.
    You'd be kicked out the door. It's the driver you have to sue.

    Quote Quoting ivasergey
    View Post

    Do you think i have strong position to recover $1400 or judge may also think that "reasonable" means somewhere between what i'm asking and insurance company is offering?
    I think you'd have a better chance if you submitted your receipts instead of playing the pie in the sky game. The adjuster has no obligation to pay you (and won't) based on fluffy estimates.

  10. #10
    Join Date
    Jul 2018
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    1,395

    Default Re: Loss of Use - Reasonable Substitute Car Value

    You didn't fully answer my questions: Did you actually rent a car for $70 per day? If the answer to that question is no, did you incur any costs for substitute transportation? If so, what costs did you actually incur?

    You told us:

    Quote Quoting ivasergey
    View Post
    i rented the car on week days and then returned it for the week-ends to save money
    So...how much did you actually incur, and did you actually save money doing it this way?


    Quote Quoting ivasergey
    View Post
    I was also thinking to go to Small Claims court and try to sue insurance company. Do you think i have strong position to recover $1400 or judge may also think that "reasonable" means somewhere between what i'm asking and insurance company is offering?
    You're not entitled to recover anything more than what you actually paid, and you don't sue the insurer; you sue the other driver.

    Quote Quoting ivasergey
    View Post
    thanks. could you please clarify why [it is not appropriate to sue the insurer]?
    Sure. It's because the insurer did not damage your car. The other driver did. I'm not sure where you're getting from the standard policy language that it's appropriate to sue the insurer, but the most important language is the statement that the insurer "will pay for damages . . . for which any covered person becomes legally liable." The liability rests with the other driver. The insurer's duty is to it's insured, and that duty is to indemnify the insured. The insurer owes no duty to a third-party claimant such as yourself.

    Quote Quoting ivasergey
    View Post
    My understanding was that when i buy Liability insurance let's say from Geico that covers first 25 000$ towards damages and losses caused by me to other driver's property.
    That's correct.


    Quote Quoting ivasergey
    View Post
    So other driver can't even sue me unless they think the damage is over 25k and my policy won't cover it
    That's wrong. Having insurance doesn't prevent you from getting sued. It merely provides you with a "bank" that will pay up to the policy limits if you are determined to be liable.


    Quote Quoting ivasergey
    View Post
    Liability insurance is mandatory at least in Texas but from what you're saying it doesn't really protect me from liability and other people can still sue me. Why do i need it then?
    Liability insurance is not for the protection of the insured. It's for the protection of persons damaged as a result of the insured's negligence. It is, of course, incidental that liability insurance will "protect" the insured in that the insured won't have to pay anything up to the limits of your policy. Also, if you get sued, your insurer will pay for the cost of an attorney to defend you.

    P.S. The $30 per day for 30 days thing has nothing to do with liability coverage. For example, in addition to carrying liability insurance, I carry rental car reimbursement coverage. That coverage pays if I need a rental car as a result of something covered by my collision or comprehensive coverage. For a situation in which a third-party needs a rental vehicle as a result of the insured's negligence, there is no limit (although the insurer certainly can object that the third-party's costs were not reasonable).

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