Handling Vehicle Damage Claims

Although claims for vehicle damage are relatively simple, problems sometimes arise. This leaflet will assist you in handling your damage claim quickly and efficiently in order to minimize your headaches while maximizing your recovery.

A. Which insurance company is responsible for the damage to my vehicle?

Florida law now requires at least $10,000 of property damage liability coverage. Therefore, the defendant's insurance company will be responsible for the damage to your vehicle if the accident was 100% the defendant's fault. If the defendant's insurance company refuses to accept full liability for the accident and you have collision coverage on your own policy, you can make a claim with your own company, but you will have to pay the deductible. Your insurance company will then make a claim for reimbursement from the defendant's insurance company and in doing so, will also assist you in recovering your deductible. You may also independently attempt to recover your deductible from the defendant's insurance company by negotiating or filing suit, but if you were injured in the accident, you should sue for your injuries in the same lawsuit, or you may waive your injury claim.

If you do not have collision coverage on your policy, and the defendant's insurance company refuses to accept full responsibility for the accident, you can still get a percentage of your loss from the defendant's insurance company, depending on the percentage of the defendant's fault in the accident. In other words, if the defendant was 80% at fault for the accident, his insurer should pay 80% of your loss.

B. For what losses should I be compensated if my vehicle is not a total loss?

Generally, if the cost to repair your vehicle exceeds 80% of its cash value, it is declared a total loss. If the cost of repair is less than 80% of the cash value of the vehicle, you are entitled to the cost of repair, plus downtime. Downtime on a drivable vehicle is reasonable rental value for the time it reasonably takes to make repairs. Downtime on a non-drivable vehicle is reasonable rental value from the date of accident until repairs are completed. REMEMBER, insurance companies will not be responsible for any delays in getting your vehicle repaired, so you must move quickly. Also, you can only get downtime from your own insurance company if you purchased coverage for a rental vehicle. In downtime claims against your own insurance company, you are reimbursed, up to your policy limits, for the cost of a vehicle you have rented. When claiming downtime against the defendant's insurer, you are entitled to downtime even if you have not rented a replacement vehicle.

C. For what losses should I be compensated if my vehicle is a total loss?

If your vehicle is totaled, you are entitled to the actual cash value of your vehicle as it was just before the accident. This does not mean blue-book value! It means the amount you would have to pay in our area to purchase a similar vehicle in substantially the same condition and with the same number of miles as your vehicle. You can determine this by looking for similar vehicles in the newspaper, auto trader magazines and by contacting dealers. Remember, the asking price is always higher than the amount for which you can purchase a vehicle, so do not go by asking price. Professional appraisers can also assist you in determining the actual cash value of your vehicle, but you must pay their fees.

Whether you are entitled to downtime on a totaled vehicle is a subject of great legal debate. If you have rental coverage on your own policy, you should receive reasonable rental value for the period of time it reasonably takes to replace your vehicle, subject to your policy limit. If you seek downtime on a totaled vehicle from the defendant's insurance company, they may refuse to pay it based on current case law. However, this case law is now under attack and many insurance companies will still pay downtime on a totaled vehicle. You should move as quickly as possible to replace your vehicle, because no insurance company will pay downtime for delays in replacing the vehicle. Some companies even take the position that you should replace your vehicle before you receive the payment for it, if you have the funds available to you.

D. What about towing expenses?

Your insurance company will only pay towing expenses if you purchased towing coverage on your policy. The defendant's insurance company will pay 100% of your reasonable towing expenses caused by the accident if they agree that the accident was 100% the defendant's fault. Otherwise, they will pay a percentage of your reasonable towing expenses equal to the percentage of the defendant's fault in the accident.

E. Can I elect to keep my totaled vehicle?

You can keep your totaled vehicle if you prefer to do so, but the salvage value of your vehicle will be deducted from your settlement. In other words, if your totaled vehicle can be sold for $200 for parts and scrap metal, you will receive the actual cash value of your vehicle minus $200. You will also be required to turn in your title and a new one will be issued reflecting that the vehicle had at one time been declared a total loss.

F. What about the repairing of my vehicle?

You can have your vehicle repaired at the shop of your choice, or even repair it yourself. However, some insurance companies work with shops that offer warranties on repairs, so ask the insurance company if they have made such arrangements before you decide. If you borrowed money to purchase your vehicle, your loan agreement probably requires that any damage to your vehicle be repaired. Otherwise, you can put the repair money in your pocket if you do not mind driving a damaged vehicle. Also, if you can find a shop that will do the repairs for less than the insurance company has offered, you can pocket the difference.

If, upon commencing repairs, the repair shop finds additional damage not included in your original estimate, the insurance company should be permitted to inspect the additional damage before it is repaired. If they agree that the additional damage was due to the accident, the insurance company will write another check, called a supplement, to pay for the additional damage.

G. How do I go about renting a vehicle?

Many insurance companies have discount agreements with a car rental agency. Therefore, you should first contact the property damage adjuster to find out if the insurance company has such an arrangement with any car rental agencies. If so, the rental agency may also send the bill directly to the insurance company. Otherwise, the insurance company will reimburse you for the rental expense. Keep in mind that insurance companies do not pay for insurance on the rental car often referred to collision damage waiver insurance. However, you may not need this coverage if your policy contains collision coverage on your damaged car. Also, you are only entitled to a vehicle similar to your damaged vehicle. Therefore, if you normally drive a Volkswagen, you are not entitled to rent a Cadillac.

H. Will I be required to sign a release?

A release is a document which insurance companies ask you to sign to acknowledge that your losses have been paid in full. Releases for vehicle damage should specify that they are for property damage only. Otherwise, you could waive your claims for injuries, lost wages and other losses for which you should be compensated. It is always best to have your attorney review any release before you sign it.

The information provided above should be used as a brief guide in handling vehicle damage claims. It was not designed to provide all of the fine details of the law. Furthermore, the law and insurance policies are always subject to change. Therefore, if you have any questions, you should contact your attorney. Good luck with your claim.