What To Do When Your Insurance Company Says Your Vehicle Is a Write-Off
May 17th, 2017
This is one of those articles that is full of information that you don’t need until you do. And then you really need it…
You’ve been in a vehicle collision. First concern of course is that hopefully everyone is safe. Eventually the tow truck shows up and hauls your vehicle away to a local body shop (hopefully to the collision centre at Doyle Dodge – remember, it is 100% YOUR CHOICE where your vehicle is repaired!). You contact your insurance company and the process begins. The local body shop does a quote for repairs, and your insurance company contracts a local adjuster to go out on site to verify the quote. Depending on how old your vehicle is they may ask for OEM parts, for aftermarket parts, or even for the body shop to source used parts wherever possible to keep costs down. But sometimes it doesn’t matter – the price of the repairs exceeds what the vehicle is worth, and the insurance company deems the vehicle to be a write-off.
Sometimes there are a lot of variables at play at this point –
- perhaps you have GAP insurance on your auto loan, which will top up whatever the insurance company pays you up to whatever you owe the bank (this is a product that may have been offered to you in the Finance Office at your dealership when you purchased the vehicle).
- or perhaps you are not long into new vehicle ownership and your insurance company offers a replacement coverage – in this instance your insurance company will talk to local dealers and find out what price would be needed to replace the exact same vehicle.
This article isn’t really for the people in the above categories. Things should work out fairly smoothly for you. This article is for those other people without those coverages.
Here is my step-by-step advice for those other people. Follow these steps to make sure you get treated fairly and don’t miss out on potentially thousands of dollars. These steps are easy, and just a matter of a bit of online research and writing an email. Lets say you were driving a 2014 Dodge Grand Caravan with 50,000 kms, any of the figures used below are just an example for argument’s sake. Here we go:
Step 1 –
Within a few days your insurance company will call you and tell you that your vehicle is written off, and they are going to give you $15,000 for it. You are under no obligation to just accept this offer blindly. Thank the person, get their name and email address, and tell them that you will get back to them very soon.
Step 2 –
Now some online research begins. Your best bet here are websites like AutoTrader.ca and/or Kijiji.ca. Using the ‘Advanced Search’ functions on these websites, narrow down your search to something as specific as possible. Some vehicles are less common on the road, so therefore are harder to find comparables, but for the most part you should be able to find some really close matches if you expand your search to a 500-1000 km range. You are looking to see what these vehicles are retailing for elsewhere, and hopefully you can find some examples from some reputable sources where they appear to be selling for more money than the insurance company offer. Make sure to look closely at the listings – if the Grand Caravan in our example is an SXT model, then don’t use R/T models to compare with as they are way more expensive and not comparing ‘apples-to-apples’. Also don’t short-change yourself by comparing a lesser model like the Canada Value Package. Find examples that are as close in mileage, equipment and trim level as possible. If you don’t know much about vehicles perhaps you have a friend that is a ‘car-nut’ that could help, or I’m sure your friendly neighbourhood Doyle Dodge car salesperson would be happy to help as well.
Step 3 –
So, how did you make out? If the offer from the insurance company seems fair, then great! You are dealing with a great company and are being treated right. Now aren’t you glad you took 15 minutes to reassure yourself that the offer was legit?
But what if you found a bunch of listings where dealers were asking for a few thousand more than the offer? Going back to our example, what if the going price is more like $16,900? Wouldn’t you like that extra $1900? Then ask for it!
Step 4 –
Now is when you write your email to the person from the insurance company who had called you (remember, I told you to ask for their email address). BE POLITE and PROFESSIONAL! You may feel like they were trying to take advantage a bit, but keep two things in mind: (1) people are always willing to help you out more if your are courteous and understanding, and (2) they very likely were not trying to take advantage – its more likely they typed your vehicle info into their database and their offer was just the number that spit out at them.
Thank them for their initial offer, and then mention that your research has brought to your attention some examples of your vehicle being worth more money. Copy and paste the website addresses for those specific links from AutoTrader and Kijiji. Now just simply tell them you want an offer that is in line with these examples.
Believe it or not, that’s usually it. That’s all it normally takes. Maybe they don’t go right up to your highest value (keep in mind, they can probably use the same Trader and Kijiji sources to find some examples of vehicles listed close to their offer too). But even if they meet you half way, isn’t that worth your 30 minutes? I think so. Before we finish, two more steps that you may or may not need to take:
Step 5 (if necessary) –
The offer from the insurance company should be for the value of the vehicle + HST! This sometimes gets missed somehow. So if your vehicle ends up being worth $16,000, then the insurance company should be cutting you a cheque for $18,080. Don’t forget to watch for this!
Step 6 (if necessary) –
If you purchase your insurance through a local insurance broker then more than likely your representative will be happy to help you with this whole process, and should fight on your behalf. Keep them in the loop on all this as their advice is helpful too. They want to make sure you are a happy customer and insure your new vehicle through them too!
That’s about it. Hopefully you never need this advice, but if you’re ever in this situation I hope you remember these tips. As we enter the summer months we wish you a happy summer and safe driving!