Car insurance, car, and what happens now

In My Humble Opinion
1

My daughter’s car is a Saturn Vue. It’s old (early 2000s) and well-traveled (234,000 miles). There are a lot of small but annoying things about it–the driver door sometimes is very difficult to open, you have to cancel the turn signals manually–and it seems as though bigger issues happen to it with some regularity. Well, it’s old and well-traveled, so perhaps that’s to be expected.

Anyway, she was rear-ended last week while at a stop sign. She hurt her hand and was eventually diagnosed with a mild concussion, but seems to be doing pretty well. The back of the Saturn suffered too: the bumper is smashed up (she is perversely pleased that you can see the imprint of the other driver’s license plate in the center), and the lift gate is damaged as well.

My guess was that the car would be declared totaled; but in fact my daughter has been given an estimate. Full repairs, the company thinks, will cost $1900 (well, it’s actually $1899.44). There’s a $500 deductible, so the company is willing to pay $1400 to get the car fixed. The implication, in talking briefly to the guy who wrote up the estimate, is that this figure is close to the level at which it would be declared totaled, and that if she does take it to a body shop there’s the possibility the shop will find other damage that would take it over the limit.

I haven’t dealt much with insurance companies for this sort of thing–the one time I remember doing so was back a ways and the car was clearly totaled. Daughter hasn’t dealt with this at all, and unfortunately I’m not able to help much because of my own lack of knowledge/experience. We have a call in to the adjuster to explore the options, but haven’t heard back. My impression, but it’s only an impression, is that my daughter has 2 basic options:

–Take the car in, get it fixed (if indeed there isn’t anything more than what the adjuster can see), pay the $500 deductible, get back on the road;

–Or, collect the $1400 the insurance co says the vehicle is worth, forget about fixing the Saturn, and put the money toward another (cheap, old, high mileage) car that might be in better shape. (Her funds are limited, but $1400 plus what she can spare right now is likely to be enough for a down payment on a less crappy used car.)

I guess there’s also Option “3”: take it to the repair shop on the assumption that they will find something else big to fix and the car will be declared totaled, taking the whole thing out of our hands. But that’s going out on a limb.

There’s a part of me that would really like her not to have this car any more. Not sure it makes sense to shell out $500, given the vehicle’s precarious state, to put Humpty Dumpty together again. [To be fair, when she bought it she did so against my advice, which may possibly play a role in that opinion :). She’s a little more attached to it than I am.] OTOH, life is quite complicated just now, and embarking on a search for a new car is not something that either of us would look forward to.

So, my questions:

–Am I basically correct that these are the options she’s got?

–What should she consider in making the final decision about what to do?

And, if you have an opinion about what would make the most sense (and why), I’d be interested in hearing it.
(She does need a car for her job, so doing without is not an option.)

Thanks very much for any insight anyone may have. Hope I’ve given sufficient information… You always want to help your kids navigate the world, even when they’re grown up, and there are lots of ways I can help her and have helped her in the past–but car insurance, and cars, turn out not to be among them. Sigh.

2

If she was rear ended the other drivers insurance should make her whole. No deductable should be involved.

3

I agree, it’s the other driver’s fault. Their insurance, no deductible.

If the car is driveable I’d just take the money.

4

Another option would be to take the $1400, and then take the car to a guy who does body work in his spare time, and have him fix whatever absolutely needs to be fixed to make the car safely drivable. Chances are he can bang it out for a couple of hundred, maybe even less than the deductible… The car won’t be pretty, but it’ll be transportation. But some insurance companies won’t give you a payout, but only direct to a repair shop.

The big question, is why she even carried collision on a car of such low value? She has probably paid more than $1400 in collision premiums.

5

I read this as another driver hit the vehicle driven by the OP’s daughter. If so, the other driver’s insurance should pay with no deductible… assuming that driver even has insurance.

If the other driver is uninsured then the OP’s daughter may want to make a claim against her own policy if she carries Uninsured Motorist coverage.

In addition to the repair cost, the claim against the other driver’s policy should cover use of a rental car for the time her vehicle is int he shop. If it really is that close to being totaled you may be able to negotiate with the insurance company if the $1899.44 plus the rental car would put it over the totaled value of the vehicle.

6

Yeah, you’re right. The OP needs to tell us which driver’s insurance is settling the claim. If it’s the other driver, there’s no deductible.

7

A few comments about the option of taking a cash settlement while trying to keep the car and getting it repaired on your own …

The insurer may or may not let you do this (and it’s also unlikely that you can get decent repairs done for much less than the estimate). But if they do, you won’t get the full repair estimate in the settlement because the insurer will deduct the salvage value that they would have received if they had taken possession. Also, because of the salvage value factor, insurers will sometimes declare a write-off even when repair costs are less than the estimated value of the car.

The other thing to be aware of is that in many jurisdictions, an insurance write-off receives a designation called a “branding” in the DMV registration. The consequence of branding depends on the laws in the jurisdiction and the circumstances, but it’s quite possible that when there is structural damage due to an accident, a branded write-off may not even be allowed on the road without a special certification of mechanical fitness. This may or may not apply where you live, but it’s something to be aware of.

8

What “company” estimated this the cost? The responsible party’s insurance company? Your daughter’s insurance company? The auto repair company? What this figure means depends on who it came from.

Also, remember that the dollar amount they will consider it a total loss is not the value of the pre-accident vehicle, but the value of the pre-accident vehicle minus the scrap value. For 15 year-old vehicles with 200,000+ miles, the value of the pre-accident vehicle is very close to its scrap value, so it doesn’t take much damage to total it.

The insurance isn’t likely to give you an option of fixing it or totaling it. That is their decision and, IME, for a car this old, total loss is usually the call. Now, you will have the option of buying the vehicle back from the insurance company for the scrap value and having it repaired. Usually, the car will be saddled with a “salvage” title, which may affect its value, but it may be the cheapest option (if you think the damage is reparable for less than it would cost just to buy another used car).

9

Thanks very much for the responses.

To clear up some points and answer some questions:

–The estimate my daughter has in hand, of $1900 with the deductible, comes from her own insurance company. She says she thinks the adjuster said it’s likely the deductible would be covered by the other driver’s insurance, but she’s a bit vague about the details.

–I looked up the salvage title and branding stuff, which was interesting to learn about! Far as I can tell, in my state this applies only to cars 8 years old or newer–so it should not affect this ancient Saturn.

–The car is perfectly driveable. The guy who did the estimate specifically told her there would be no problem with her driving it, certainly while she was waiting for the estimate to come through. It looks pretty bad from the back, and trying to open the lift gate would probably be a bad idea–but it goes! :slight_smile:

–I agree that the decision to total the car rests entirely with the insurance co, not with my daughter.

–My daughter did come away with the impression that she could choose to fix it or to accept cash in lieu of fixing. I guess we’ll find out if we manage to connect with the adjuster tomorrow.–She is quite sure the adjuster said nothing about salvage value, so unless she missed something or the guy didn;t tell her something important, it sounds like it doesn;t apply(?).

Thanks again. Any other thoughts, given this new info, would still be appreciated.
Ulf

10

Forgot to address this. I’m not sure why she had the collision coverage, the agent might have talked her into it; but she’s only owned the car for a year and a half and her monthly payment is just north of $100, so she’s paid quite a bit less than $1400 for that part of the coverage.

11

I’m still unclear why she is dealing with her insurance company at all. Anytime I have been hit by another vehicle I called their insurance company and dealt directly with them. I may have let my agent know as a courtesy, and to get his opinion on the best way to protect my interests, but really they are not involved. In those cases I have never had to come out of pocket for a penny, including getting a rental car during the repair process.

ETA - if the other driver was uninsured, of course, you have to use your own insurance. That would fall under uninsured motorist, though, not collision.

12

The only way I could think of would be if it was financed. Financing usually means one has to carry full-coverage insurance.

13

The other driver was insured. The car was not financed; my daughter paid cash when she bought it.

Yes, she could have gone to the other driver’s insurance directly. The police officer who responded to the accident, however, advised her not to; in the officer’s opinion drivers in my daughter’s situation were better off going through their own insurance companies. The officer said that she has heard too many stories about drivers who went to the other driver’s insurance, and lost valuable time (and perhaps money) being jerked around.

Now, maybe the officer was full of it, I don’t know, but I have to admit I’m just as happy having my daughter deal with a company she has a relationship with (and to whom she pays bills); I don;t recognize the name of the other guy’s insurance co and while I have no reason to think they’re crooks and while it probably would have been fine if we’d gone that route, I think we’re probably better off this way.

We did connect with the adjuster today. Bottom line: two choices. She can take the repairs, assuming they do not actually cost much more than the $1900; she would additionally be entitled to a daily $30 for a rental while the car is in the shop. Her insurance would initially foot the bill and recoup from the other insurance co, including her $500 deductible, so no cost to her. Or, she can take a check for the full $1900 and keep the car. Still mulling this one over. (It’s a pretty terrible car in lots of ways, but it does get you from point A to point B…)

But at least there are no issues with salvage titles, scrap value, or anything similar–so that’s good.
Thanks.