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  1. #1
    Join Date
    Dec 2004

    Default Question about Insurance

    I'm in California

    Last week while sitting at a stoplight, I was rear-ended by another driver. My car was totalled, her's just sustained some damage, although it wasn't totalled.

    I've never had a totalled vehicle before so I'm not sure how to proceed.

    My insurance company offered me an amount that is $2,000 less than I owe on the car.

    Being the victim of this accident, I am the one who is getting reamed. The negligent party gets her car repaired minus her deductible. I get to fork out $2,000 for a car that I can't drive, plus I don't have any additional money for a down payment.

    In addition, I have been experiencing back and neck pain for which I have sought medical attention and will continue to seek attention for.

    My question - Can I decline the offer the insurance company has made me (we both have the same insurance company)? If I accept it, can I sue the "at fault" party in small claims court for the deficit and also for my mental anguish?

    Some co-workers have suggested hiring a personal injury attorney, but I wasn't sure what to do.

    Can you Please advise?

    Thank you for your time.

    Wendy S. :cry:

  2. #2
    Join Date
    Sep 2004

    Default Diminishment in Value of Car

    Dear Wendy,

    The situation you describe with your car is quite typical after an accident. There are two contributing factors:

    1. Cars "depreciate" quickly. It is not unusual for people with car loans to find themselves "upside-down" on a car, which is to say that they owe more on their car loan than the car is worth. Unfortunately, when an insurance company insures the value of the car, unless your contract provides otherwise (and it probably doesn't) it is insuring the market value and not the loan balance. If that is the case, when the market value is less than the loan balance, after an accident the payoff won't be enough to satisfy the loan.

    2. Insurance companies often make a first offer that is on the low side, in anticipation that you will accept it and they will profit from the low settlement. You should look at the online "blue books" - NADA, Edmunds, and Kelley, as well as AutoTrader, to see what similar cars are selling for in your area. Please note that AutoTrader only lists asking prices, not selling prices, so it is likely to suggest a higher value and is not likely to be decisive. Also, sometimes one of the "blue book"-type sites gives a value significantly higher (or lower) than the others.

    In terms of having your case assessed for a lawsuit against the other driver, it would be a good idea to have that assessment done with the assistance of a California lawyer.

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