Am I being ripped off or is this standard practice?

[thecurious]

Sorry for the long rant but I am just trying to get opinions from people more knowledgeable than myself. My son was in a wreck and his car was totaled. I am dealing with the other party’s (big name) insurance company to get a settlement offer.
The whole process has been very frustrating and I feel like we are getting ripped off. Just wondering if what we are experiencing is standard/normal practice by all insurance companies.

The insurance company has agreed that everything about our car was in good or better condition.

1. They offered an initial settlement amount which I immediately knew was too low. I realized that on the offer letter they had listed our car with about 9,000 more miles than it actually had. I then looked up similar cars in our area and sent them a list with asking prices. I also sent them the cars I could find for their offer price which were all crappy (50k miles more than ours had, damage all down the passenger side, etc).
2. They called me a couple of days later and said they had “made a mistake” on the mileage. They had corrected it and were offering me a new amount that was $700 higher than the previous offer.
   They then proceeded to tell me that the comp cars I had sent them were “way overpriced”. I said ok, then you need to send me the comp cars you are using because I don’t believe I can get a comparable car for the price you are offering.
3. They send me the list of their 5 comp cars (which are apparently gathered by a 3rd party called CCC). After researching these I determined the 3 lowest priced ones all had issues:

• Comp #1 is the one I had found previously that was damaged along the entire passenger side. The damage is clearly visible in pics on the dealership’s website.

• Comp #2 had 4 accidents including the most recent one in which the airbag had deployed. I found this out by buying the carfax report.

• Comp #3 had reported frame damage.

They also added a negative $600 “condition adjustment” to all of these comp cars.

1. When we had a phone call to discuss my concerns, this is what they told me:

A. They can use any cars as comp cars as long as they don’t have a salvage title. They can use cars with accident history as long as they have no reason to believe it wasn’t repaired.

B. They said if I can provide proof that any of the comp cars have not been repaired, then they will remove it. However, I have no idea how I would even go about determining if the deployed airbag had been replaced or if the frame damage car had been fixed.

C. They do not take accident history into account when determining valuation. To them, there is no difference between my car with no accident history and their comp car with 4 accidents.
I’m not sure how the insurance company can say with a straight face that 4 accidents on a car would not cause the list price to be lower.

D. They agreed to remove the Comp car with the obvious damage on the passenger side. They had “missed” catching the damage during their review. The offer price went up another $1200.

E. They say the negative $600 condition adjustment is standard because they assume all cars being sold by a dealership are in “dealer condition”. (I have done plenty of used car shopping the last few years for my teenagers and have seen many cars for sale on dealer lots with ripped/stained interiors, peeling paint, etc). Used cars come in all conditions and I don’t understand how the insurance company can just assume their comp cars are in better condition than our car (unlikely based on the quality of comp cars they are using).

1. At this point I am sitting with their latest offer which is based on the below 3 comp cars (they have apparently taken a few off and added a new one which is no better as it has accident and theft history). I am $1900 higher than where we started but it still doesn’t feel right. I don’t know if it’s worth fighting them any further though.

• Comp #1 - 3 accidents + Theft reported

• Comp #2- structural/frame damage reported

• Comp #3 - this one is the highest priced of the 3 so it is the least concerning. However it is sold so the listing is not available for me to review pictures/condition/etc. I haven’t bought the carfax report for this one because I’m tired of spending money to figure out what issues their “comp” cars have

**I will also note that our car was older (2010) but had all optional features like backup camera, parking sensors, blind spot monitoring system, sunroof, spoiler, etc. The comp cars they are using do not have these features, but they are only adding a $300 combined adjustment for them. It just feels like they should be worth more

 

[kejuli]

@thecurious People always feel their car is worth more than it is. And list prices are pretty garbage. I can list my 2019 Camry for 50K on craigslist, that doesn't mean anyone will buy it for 50K.

You're doing what you can by pointing out the flaws in the CCC report, but CCC is pretty much standard across multiple insurance companies.

 

[travisdt]

@thecurious You’re owed actual cash value, not replacement cost. Car values are still very inflated, so you’re unlikely to be able to replace it with a comparable car, as ACV is what you’re owed. A pre-2010 vehicle and they adjusted it up $1900? That sounds like a win. You could always go through your carrier if the coverage exists to see what they have to say.

 

[thelightinthetower]

@thecurious When a car is a total loss, the insurance company pays out the actual cash value (replacement cost minus depreciation of the vehicle) instead of just replacement cost. Unfortunately it usually isn’t enough to get the same car bc listed vehicles for sale are going to include markups for profit and fees. It’s crappy, but it is standard practice. I’ve worked at 3 insurance companies and it’s been the same at all 3

 

[aamcle]

@thecurious As @travisdt said....you're owed actual cash value, not replacement cost. They're not the same thing. And you're not going to get a perfect comp on a 2010 vehicle. And list prices aren't they key. Sale prices are. People can list a car for anything. What matters is what the cars are really selling for.

I don't know the starting value of their offer and what you think this car should be worth, but they just raised their offer by nearly $2000? Sounds like a win. But give us all some hard numbers here. What is the car, what is their offer, and what is it that you think you should be getting here.

 

[lianne72]

@thecurious Yes they are screwing you. Insurance companies want to make money not help the people not making them money. They will always screw you, thats why they have lawyers. Never deal with an insurance company without your own attorney to get lube for the screwing. Never ever trust anyone in insurance, even your own agent.

 

[phdjones]

@lianne72 Hope you have a lawyer who works for free cuz they’re going to charge you hourly for this and it’s going to cost more than it’s worth

 

[lianne72]

@phdjones Contingency

 

[phdjones]

@lianne72 LOL no lawyer is going to take a PD case on contingency are you kidding? Their percent of the settlement will literally be less than one billable hour.

 

[sammypants]

@thecurious Alright, I use CCCone. Here's how the valuation process works when a car is deemed to be a total loss.

1. I record any of the available information. Year, make, mileage, trim, addons, etc.
2. I rate the vehicle's various aspects. paint condition, interior condition, glass, tire tread depth, etc. Because this is an insurance claim, there will obviously be damage somewhere. And I can't say "Well the front end is burned to the ground, that's obviously bad condition". It's assumed there's damage, and I extrapolate the condition of non-damaged portions of the car to the damaged portion and assume they are the same. For example, if the paint on the rear of your car is pristine and immaculate, I can assume the burned down front end you have was also pristine and immaculate before it burned down, and will rate it accordingly.
3. I input all this into CCCone (A third party program, I have ZERO control over what they do from this point forward)
4. CCCone will take all of those and match it up against similar cars, and their SALE price. not their LIST price. Two different numbers. And will get together a list of 10-20ish cars. Average those out, and that's you valuation. Less the depreciation. (13 year old cars going to be worth whatever percent less they determine that is), and take it out of the settlement.

Also, "Dealership condition" is one step below the maximum possible rating. And is the most common for "good condition" cars. In the few thousand estimates I've written, I've only ever come across ONE car that I rated higher than dealership, and that was a 2001 Silverado with 2,000 miles with one owner who was a professional detailer. That thing was in better condition than most 2023 models.

If you managed to wriggle $2,000 more out of them, call it a win. You probably won't get much more than that.