| BASIC PROPERTY DAMAGE INFORMATION – MOTOR VEHICLE CLAIMS This document hopefully will help answer common questions about your rights and what you can expect from the insurance companies in regards to your property damage claim. The property damage claim can be a frustrating part of a motor vehicle collision, however it does require your immediate attention and action. Remember, take photographs of the property damage. When another person causes a collision, generally that person's insurance company will cover the costs associated with your property damage claim. If you have insurance coverage, sometimes you may be required to use it to cover the costs associated with your property damage claim. A property damage claim can be resolved in one of two ways: (1) the vehicle is repaired or (2) the vehicle is determined a total loss (the cost of repairs exceeds the actual value of the vehicle). In the case of a total loss, the Fair Market Value (FMV) of the vehicle is determined and offered in settlement of the property damage claim Setup the Claim - You will need to setup the property damage claim with either the at-fault driver's insurance carrier or your own insurance carrier. Sometimes you will need to involve your own insurance if you maintain collision and/or rental car coverage. If the at-fault driver's insurance company has accepted liability, the property damage claim can be set up through the at-fault driver's insurance company. If you carry collision coverage on your own policy and the at-fault driver's insurance company is not cooperating, it is usually faster, easier and more convenient to have your own insurance company process your property damage claim. When using your collision coverage, in most cases you will be subject to paying your collision deductible. If the at-fault driver is uninsured, you will need to use your own collision coverage and you will be subject to paying your deductible.
- Under Wisconsin law, a person has an affirmative duty to mitigate (to lessen) damages. This duty to mitigate damages includes, but is not limited to, the timely removal of your vehicle from a pay/fee-charging storage/tow lot and the return of any rental vehicle in a timely manner. Any failure on your part to mitigate your damages may result in you having to pay for those expenses.
Towing/Storage Fees - If your vehicle was towed from the scene of the collision, it was mostly likely towed to a private fee-charging storage lot. These private storage lots charge a daily storage fee that can add up very quickly and subject you to out-of-pocket expenses.
- The at-fault driver's insurance company or your own insurance company (if you have collision coverage) will pay reasonable towing and storage fees. Keep all receipts and submit them to the appropriate insurance company for reimbursement.
- If the at-fault driver is uninsured or the at-fault driver's insurance company is not accepting liability, and you do not have collision coverage, then you are responsible for paying the fees to remove your vehicle from the storage lot. If your vehicle remains in a fee storage lot for an unreasonable time, it may be impossible to recover those storage fees from any insurance company or the at–fault driver.
Rental Vehicle - While your vehicle is being repaired or the fair market value (FMV) for the total loss of the vehicle is being determined you can obtain a rental vehicle through the at-fault person's carrier, if the carrier agrees or through your own carrier if you carry rental coverage on your own policy.
- The insurance company will not usually pay for any extra insurance associated with the rental vehicle. Be sure to call your insurance carrier to confirm your coverages. If you do not have collision coverage, you probably will be required to pay for additional insurance coverage.
- The method of payment for the rental vehicle will vary depending on your insurance company's policy. Some will use the direct bill method, while other insurance companies will operate on a reimbursement policy. When the insurance company pays for the rental vehicle directly to the rental car company, this is the direct bill method. The reimbursement method means that you pay for the rental vehicle and then the insurance company reimburses you for the cost. The rental car company will usually require a credit card to insure payment for the rental vehicle.
- The rental vehicle needs to be returned in accordance with the insurance company's instructions. Failure to timely return the rental vehicle may result in non-reimbursable out-of-pocket rental expenses.
Repairs - Your insurance company normally has the sole option to either repair or determine that your vehicle is a total loss. If the cost of repairs is less than the Fair Market Value (FMV) of the vehicle, the vehicle will be considered repairable.
- Most insurance companies will evaluate the cost of repairing your vehicle separately and independently from any repair shop. Be sure to give the repair facility the estimate generated by the insurance company and that the repair facility agrees to repair your vehicle for the estimated amount. Should your vehicle require additional collision-related repairs, the repair facility will need to supplement the cost of the additional repairs to the insurance company for approval and authority. In most cases the repair facility will deal directly with the insurance company for supplemental repairs, but you must verify your insurance company will pay for the supplemental repairs before this work is under taken.
- If the insurance company claims that some damage to your car pre-existed the collision or you claim that the collision generated mechanical malfunctions, you have the burden of proving that the damage was indeed caused by the collision. If this occurs, you must prove the connection between the auto accident and the damage.
Be sure to carefully inspect your vehicle upon the completion of the repairs to ensure your vehicle has been returned to its pre-collision condition before signing any insurance company check or property damage release, otherwise, you may waive your right to further accident-related repairs Total Loss - If the cost of repair is greater than the fair market value of the vehicle, the insurance company may declare the vehicle a total loss and offer you the Fair Market Value (FMV) or cash value.
- In determining the FMV, most insurance companies use computerized searches, which take into account vehicles identical to yours. Generally, the insurance company is trying to determine what your car was worth immediately before the collision. Once the insurance company makes a total loss offer, it is up to you to either accept the offer, or provide your own evidence as to why the vehicle is worth more.
- When an older vehicle is involved in a collision, it is hard to recover the cost of recent repairs. Normally, new tires or a new engine only slightly increases the value of a vehicle. If you have receipts for any improvements be sure to give copies to the insurance company as this could result in a higher total loss offer.
- The FMV does not increase if you are "upside down" on your vehicle loan. You are "upside down" on the loan for your car when you owe more money than its fair market value or what the vehicle is actually worth. The insurance company only needs to pay the FMV of your vehicle. If you owe more than the FMV, you will be responsible for the difference. An insurance company is not responsible for an outstanding loan or lease balance in excess of the fair market value. When you are offered a "total loss" settlement, the insurance company buys your vehicle. If you wish to keep the wrecked vehicle, you may purchase it back from the insurance company for its salvage value. The adjuster can deduct the salvage value from the total loss settlement and you can keep the vehicle. In other words, they will pay you the FMV of the vehicle minus the salvage value.
Obviously, not all property damage questions or problems could be addressed in this document and we advise that you consult an attorney for any questions or problems.
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