Car depreciation/insurance adjuster question

I know you are not my insurance agent and this is not legal advice, blah blah. I live in Florida and yes, I called Geico but the agent just said that she didn’t know my answer because she’s not an insurance adjuster and what I’m asking is up to them.

I have Geico insurance for my car, fully insured with ACV. I bought a brand new 2013 Honda CRV in sept and paid for it in full. I had a VERY near miss accident yesterday (all is fine but it got me thinking) and I called to ask them about coverage.

They said that if I had an accident and the car was a total loss, I would get the replacement value of the car MINUS the depreciation. But they wouldn’t give me an estimate on what that might be- I mean, I literally have no idea if they mean 1% of the price I paid less or 60% of what I paid less. Or more for that matter. They were like “well, that’s up to the adjuster” but really just wouldn’t answer me. I’m concerned that if I were to suffer a total loss, I couldn’t really buy another new car (if it was a LOT of depreciation amount).

Can anyone give me the quick and dirty about what we’re talking about here? FWIW, I paid $26,000 for my Honda. If I suffered a total loss would I be likely to get a check for like $10,000 or more like $20+K? Let’s assume I mean within the first year of having it.

They mentioned Gap insurance but that is for people with a loan that they’re upside down on. Is there such a thing for people who don’t have a loan? Or in the event that I am at fault (drive my car off a bridge) I get the depreciated value and am stuck, or if someone ELSE hits me and is at fault, I have to sue them for the difference between what my insurance pays and what I paid for it?

Any thoughts or insights are appreciated. I understand depreciation as it applies to car dealers- as in, you buy a car and try to trade it in a year later and it’s depreciated by a LOT but not how it applies with insurance and if they use the same types of formulas.

Thanks in advance if anyone has information or knows where I can get some facts.

Basically, they look at your car at the time of the accident: mileage, condition, etc and calculate a value. They are not going to do this everytime somebody wants to know the value of their car. It is a waste of resources. Use KBB or Nada for an estimate. Best guess: $20-$23K for a $26k car driven off the lot yesterday.

I am talking out my ass, but I’d expect you to get something close to the KBB value. A basic 2012 CRV is a $19K trade-in. So I think you’d get close to that, a little more. Maybe a lot more if you totalled it, say, today. They probably can’t give you an estimate because it’s different for every car.

Paying it off early/paying cash is great! Congratulations!

Thanks for both answers- as I said, I wasn’t looking for an exact number but she couldn’t even give me a remote ballpark guestimate. I don’t know if KBB is an accurate way to gauge it either, that’s what I’m asking- if anyone knows (isn’t guessing).

Thanks Rysler, I inherited some $$ and upgraded from a nearly 20 year old beater, so life is good but this got me thinking that I could have an insurance cap I need to address.

More thoughts are more than welcome, I’d adore hearing from someone who has been through getting a total value replacement minus depreciation or from an actual adjuster.

These days, the depreciation hit you get from driving a car off the lot is wayyyy less than it was in past, especially with something that holds value well in general like a Honda. I would guess the drive-off depreciation is less than $1000 on this car. ETA: you can even get some oddball situations where the used value is actually HIGHER than the new value, like when there’s long waiting lists for new ones or an unpopular redesign (as is the case with some current VW’s).

I have heard of extra “new car insurance” that if your car is written off, you can get coverage for the first year or two that will buy you a brand new identical car. Of course, you pay for that.

In Canada, there is the “gold book price” or whatever code they use. It says what a car of X year, Y model, with Z features would be worth on the market, and that is what they pay. Then you argue for any special extras that may have been installed, although they usually have a clause excluding some after market add-ons.

I knew a woman whose older car was totalled just after doing a significant amount of work - new tires, new muffler, other major repairs. IIRC she ended up getting a bit more out of the insurance company, since (I think) the “book value” is for “typical condition for that model’s age”.

In Ontario my insurance broker called that a “Waiver of Depreciation endorsement” and it was for the first 2 or 3 years. It only cost about $25/year so I went with it, just in case.

They look at what cars are listed for in your area. So, roughly the same as KBB. When you bitch about it, they send you a couple of “comparables.” Typically, there is a little room for them to give if you push back hard enough, but at some point it’s “Take it or sue us.”

You don’t have to accept their figures. If they pull a KBB out, then you know they are scamming you. KBB is worthless, except for them to show your car is worth less than it really is.:rolleyes:

Try Edmunds, craigslist and other venues, find similar cars and what they are priced that. Counter their offer with your figures.

Comparables are generally speaking much higher than Kelly’s.

Just a point of information concerning GEICO: They are very good at finding “comparables” that are in no way shape or form comparables and way under NADA prices. As mentioned, if you complain they have a full on “We don’t care.” attitude.

GEICO is no longer our insurance company.

Note that the phrase “the replacement value of the car MINUS the depreciation” sounds really, really bad. The replacement value should already include depreciation.

Really? Are you sure? Over here, what you’re looking for is called exactly that, Gap insurance, to pay the gap between the resale value of your car and the repurchase value.

GEICO is living breathing proof of “the cuter the commercial, the worse the product”. They have decent pricing, but they screw you over if you have a claim. I mean, *serious full on butt-fuck, without lube or a ‘reach-around”. *

As to that last- right.

The OP said he had ACV (actual cash value). Which is defined as replacement value minus depreciation. RCV is what you want, but it’s more common for houses than cars.

There are also some places that do Agreed Value, where you say what your car is worth and they raise your premiums accordingly. It’s mostly done with classics, but some companies reportedly do it with late model cars as well. That might be a courtesy, as the people that say that insure classics with the same company.

Some companies (full disclosure: I work for one one them) offer full replacement if the car was bought new less than a year ago.

I would be pleased if you PMed me that info, I’ve come up empty thus far in searching for exactly that. It just seems impossible that people don’t run into this issue/problem and need that coverage.

The person at Geico and at Progressive both said they only had “gap” coverage for loan coverage, not for depreciation coverage.

PM sent.

They have TV commercials everywhere with a Jetta.

You can always ask for a policy providing replacement cost value rather than actual cash value, but no insurer in this state will offer you one, as far as I know.

I should have gotten full replacement insurance (hindsight and all.) My 2008 Mazda was about 6 months old when half a maple tree fell on it, $8,000 worth of damage; roof, hood, windshield, upper doors, just about every panel had dents and scratches. I took it to a good shop and the body work turned out fine (and is still fine) and I was happy. However when I thought about selling the car a few years ago the assessor told me it had frame damage. I asked how it could have frame damage when it has never been in an accident (I was picturing the conventional body-on-frame construction), and that’s when I learned new cars are unibody construction, so the roof and everything is part of the frame. That considerably lowered the value of the car.

I decided that since I knew the car was mechanically perfect it was worth more to me than them, so I didn’t sell it.