Insurance Settlements (USA) - Ever heard of this?

[ReidMcT]

My 718 Cayman base was totaled in a highway mishap. I am in email communication with the insurer of the responsible party (I was not at fault and not injured). I am asking them to clarify for the second time, something that sounds almost too good to believe (for me, anyway).

Have any of you hear or known of this happening?

The insurance adjuster seems to be saying: 'We're a tiny company in California. Your car is in Texas. We'll pay you its full value, but you have to take the car, too.

At first, I assumed he meant he would deduct some estimated salvage value and leave me with less money and a junk car. But, no, it sounds like I'm about to be gifted my old car. With its many, many, many perfectly working parts. Two brand new rear tires. An engine with a 4-hour-old oil change. A PDK. That beautiful burgundy/black interior.

Or, I just let the yard auction it for me and take the cash.

Any feedback is welcome!

[blueline]

My 718 Cayman base was totaled in a highway mishap. I am in email communication with the insurer of the responsible party (I was not at fault and not injured). I am asking them to clarify for the second time, something that sounds almost too good to believe (for me, anyway).

Have any of you hear or known of this happening?

The insurance adjuster seems to be saying: 'We're a tiny company in California. Your car is in Texas. We'll pay you its full value, but you have to take the car, too.

At first, I assumed he meant he would deduct some estimated salvage value and leave me with less money and a junk car. But, no, it sounds like I'm about to be gifted my old car. With its many, many, many perfectly working parts. Two brand new rear tires. An engine with a 4-hour-old oil change. A PDK. That beautiful burgundy/black interior.

Or, I just let the yard auction it for me and take the cash.

Any feedback is welcome!

That would be phenomenal if true but it does not sound completely plausible - it's very odd at the least. There has to be a catch or so it would seem.

My initial response would be twofold. One, have them put it all in writing - dollar amount they are paying and confirmation of retaining the title to your totaled 718 free of any insurance liens. Secondly, I'd run it past your insurance agent (assuming it's someone who actually knows their business - many agents don't these days) or, better yet, an underwriter from your insurance company.

Regarding disposal by that "small" Cali insurance company, most insurance companies utilize online auctions for totaled vehicles and never set eyes on them nor ever touch the car. The winning online commercial bidder takes care of everything, including picking up the vehicle no matter where in the country it's located. (Winning online bidders are often in the same area as the totaled car.) So yes, something is not quite right in my mind with the offer, but who knows what's actually behind their decision.

[ReidMcT]

Yeah, it's hard to understand why they don't pick up the phone. But they've made it pretty clear, this is their intention. Their adjuster isn't a great communicator, but he said there's a law that the insurance company must 'take possession' of the vehicle before it can be auctioned. They don't have a representative in Texas who can do that. So - according to him - the law compels them to release the car to me. If I do nothing, then the storage yard will consider it abandoned after 30 days, and will auction it for their own benefit.

Oh, and I have to call out my insurance agent for kudos: I called her when things got really weird last week, and she was the only one besides me who understood the assignment. Yeah, she's got 50 years experience, and she takes my calls. Got her start under the escalator in Sears (remember that?), where I met her when I was a 20-something buying my first house, needing insurance, and knowing nothing. For anyone in Texas, I endorse Lilla Wright agency.

[blueline]

Yeah, it's hard to understand why they don't pick up the phone. But they've made it pretty clear, this is their intention. Their adjuster isn't a great communicator, but he said there's a law that the insurance company must 'take possession' of the vehicle before it can be auctioned. They don't have a representative in Texas who can do that. So - according to him - the law compels them to release the car to me. If I do nothing, then the storage yard will consider it abandoned after 30 days, and will auction it for their own benefit.

The "take possession" rule is something I've not heard of. Maybe it's a California specific law? If so, sounds pretty fine for you! From what I know, insurance companies will let you keep the totaled car for an amount equal to the highest bid from the online salvage auction process. Of course, unlike what you're being offered (free!!) that figure would normally be deducted from the settlement total.

Therefore, it sounds like a great opportunity for you.

[Tom]

If you have full coverage on your car by your own insurance company, I would deal exclusively with your own insurance company. I wouldn't even talk to the other driver or their insurance company at this point. They could be recording calls and looking for admissions against interest that could cost you. They will also make statements and proposals that have little to no legal effect unless/until incorporated into a written agreement and release of claims (which most people are not equipped to fully evaluate/understand). Insurance companies like to do this so they can exploit an individual's lack of experience to get a better deal. If you tell your insurance co you need to be made whole, they have a contractual obligation to cover you (assuming your policy covers it), and then they will recoup the loss from the other insurance company. But in that scenario, the negotiation will be insurance co to insurance co, and they won't be able to get away with stretching the truth or making up laws and rules that may or may not exist.

If you don't have your own insurance, or it doesn't cover this loss for whatever reason, you might want to get a lawyer to deal with the other driver and/or their insurance co. I am not an insurance coverage expert by any stretch, but that story does not make sense. I can't imagine any insurance company paying you full value for your car, and then letting you keep the totaled car. I mean 'maybe' if it was burned to a crisp and their was nothing left to salvage, but not a car like this that clearly has a salvage value in the thousands. California heavily regulates auto insurance companies, with capital requirements, etc., so even the notion that the are too small to deal with an out-of-state car sounds fishy. I'm a professional cynic, and this is all just my two cents, but my guess is they are just luring you into their little cubicle with an obviously too-good offer, where they will then try to work you over one way or another. Either that, or the 'full value' they plan to give you, isn't.

[ReidMcT]

I definitely have my antennae up. And my neighbor is an insurance litigator, ready to jump in if needed.

[grasmere]

Toms response is 100% spot on
“ If you have full coverage on your car by your own insurance company, I would deal exclusively with your own insurance company. I wouldn't even talk to the other driver or their insurance company at this point.”

It sounds like it’s a great idea to keep the writeoff etc but your insurers are indeed the ones with the responsibility and expertise of sorting it out - not you because you could inadvertently say or agree to something in error.

[ReidMcT]

Toms response is 100% spot on
“ If you have full coverage on your car by your own insurance company, I would deal exclusively with your own insurance company. I wouldn't even talk to the other driver or their insurance company at this point.”

It sounds like it’s a great idea to keep the writeoff etc but your insurers are indeed the ones with the responsibility and expertise of sorting it out - not you because you could inadvertently say or agree to something in error.

I've been puzzling over why you would advise something that seems to me like the last option I should take. And I think it is because your state has 'No-Fault' car insurance. Under that regime, yes, you deal only with your insurance company.

But I live in Texas, which has Proportional Liability, meaning whoever is at fault pays; and if the blame is shared, then they pay proportionally. In my case, it looks like the other party is not even trying to lay any blame on me, which means they (and their insurance company) are 100% liable for my loss. That doesn't mean they have to make it easy on me.

So, what about my insurance? Well, in fact I did initiate a claim on my Collision insurance when it appeared that the other party was trying to hide, evade me, tell mistruths, etc. My insurance company was willing to settle my claim.

But it would be a bad deal for me because:
1) I had much less leverage on arguing my vehicle's Actual Cash Value;
2) A claim of that size for a collision would certainly result in either my policy not being renewed, or my annual premium being increased substantially and for an unknown time into the future; and
3) My sense of right. The other party caused my loss by putting a huge, unsafe vehicle on the road. But for the luck of the bounce, I'd have been killed (though my car might have survived). They need to take responsibility.