Auto accidents can sometimes be severe, resulting in extensive damage to your vehicle. Your insurance company may determine that the damage is so significant that it may not be worth the cost involved in repairing it.
In such a case, the insurance company may declare the damaged car to be a “total loss” (which means, the car is “totaled”).
If this unfortunate situation occurs, the insurance company will offer to settle your claim based on your vehicle being declared a total loss.
Kelly Blue Book, the time-honored resource of car valuation, says that a total loss may be determined if the damaged automobile cannot be repaired legally, safely, or cost-effectively.
Oregon Law Requirements for Insurance Companies
The law in Oregon requires the automobile insurance companies to:
- Provide a written notice to the car owner explaining total loss. The notice should inform how car valuations are determined, and what steps an owner can take if they disagree with the insurer’s offer.
- Provide the car owner the appraisal or valuation reports that have been used to determine the value of the damaged vehicle.
- Pay the car owner an amount that is not in dispute, while the negotiation over the car valuation continues. (For instance, if the insurer offers $6,000 and the vehicle owner seeks $10,000, the insurer should pay the $6,000 upfront).
- Reimburse the car owner for reasonable car appraisal costs. This will apply when the car owner has a right to seek appraisal and the final appraised value is higher than the last offer of the insurer.
Oregon Total Loss Claims – Options for the Car Owner
In Oregon, typically the first step for a car owner with a salvage vehicle (an automobile that has been deemed a total loss) is to file a total loss claim their insurance company.
If the insurer in Oregon determines that the car owner has a total loss, the owner will have one of the following two options:
Accepting a full settlement
In this case, the insurance company will pay you the full amount for the damages, while you will sign over the car title to the insurer, and the vehicle will no longer be your responsibility. (If applicable, you may have to provide a proof of lien satisfaction as part of assigning the ownership of the vehicle to the insurance company).
Accepting a partial settlement
In this case, the insurance carrier will pay you partial damages, while you will get to keep the vehicle. You will have the choice to sell the totaled vehicle to a scrap dealer, dismantler, or recycler.
In addition, you could apply for a salvage title, have the vehicle repaired and inspected, and re-title it for using it once more on public roads.
An Ideal Settlement
The ideal settlement in your situation may depend on how much time and money you are willing to commit to your vehicle.
Resources such as the Kelly Blue Book provide basic information on car values, which can help you determine the valuation of your vehicle following an accident and a total loss declaration by the insurance carrier.
If your vehicle is a relatively newer model, has sustained significant damage, but can be repaired, you may consider a diminished value claim after the vehicle’s repair. As a first step in making such a claim, you can obtain a letter from the car dealer about the diminished value after the repair.
Can You Disagree with the Total Loss Valuation by the Insurer?
The total loss valuation of your car by the insurance company is not gospel. In fact, due diligence demands you should do your own research to determine the value of your car, if it has been declared to be a total loss.
If you disagree with the insurance company’s valuation, you may try to negotiate it further with them. The second option is to file a lawsuit against them. In either case, you should have some credible basis for your disagreement with the insurer’s valuation.
You would require some hard evidence to show that the vehicle was worth more than what the insurance company declared it was worth. Evidence would be needed about what was the condition or shape of the car, and what was the car’s actual value.
To prove the actual condition of the car, the best way is to have some reasonably recent images or video of the car. If you have reason to believe that your vehicle’s worth is higher than the Blue Book value (such as, if you have done some major upgrades on it), you may have a case if you can present some evidence.
To prove the car’s actual value, a salient way is to obtain the opinion of a professional appraiser. You would most likely have to hire the services of a qualified appraiser to receive an objective opinion about your car’s value.
How does the Insurer Compute Total Loss?
You should know how your car’s value is determined because it could help you in negotiating a higher payout on your claim.
Actual Cash Value
Traditional auto insurance policies mostly cover automobiles using actual value. They may determine it is not worth repairing your damaged car if the repair cost is estimated to be more than a certain percentage of the actual cash value (this is generally in the range of about 80%).
Exceptions would include an agreed value policy (typically for vintage cars), a stated value policy, and additional coverage such as new car replacement or gap insurance.
Factors used in estimating the actual cash value include the year, model, make, mileage, and general wear and tear of the car.
Tools Used for Computation
Insurance carriers would mostly use their proprietary software program to compute the actual cash value of your car.
You cannot use their program, but you can use resources such as Kelly Blue Book, Auto Trader or Edmunds for reference. You could also check out the local classified advertisements that mention prices of cars of similar model, make, and year.
If you have some recent receipts of repairs and upgrades, they could be used in computing your replacement cost. If the car has a new transmission or new tires, it could make a difference to the valuation.
Contact a Qualified Oregon Car Accident Attorney Today
If you have suffered personal injury and substantial property damage in a car accident, you should get in touch with Dwyer Williams Cherkoss, a leading Oregon law firm for personal injury cases.
The prolific and dedicated car accident lawyers at the firm will help you maximize your recovery. Schedule a consultation by calling 1-800-285-8678 today.
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