Boteler, Finley & Wolfe, Attorneys at Law

AUTO INSURANCE TOTAL LOSS CLAIM TIPS FOR THE CONSUMER

TOTAL LOSS:

Under Alabama law when the cost of repair for a vehicle is 75% or more of its fair retail value the vehicle is deemed a total loss. [ Ala Code Sec. 32-8-87(d)].  In such a situation the insurance carrier buys the vehicle from the claimant for the fair retail value of the vehicle, not the replacement value, and then applies to the State’s department of motor vehicles for a Salvage Title.
    In a total loss situation some claimants find themselves owing more on the car than the fair retail value of the vehicle. This means they may still owe money on a car that they no longer have or can use.  Again, the insurance company for the at -fault driver is not responsible for money owed on a vehicle in excess  of  its  fair retail  value.  If  you  think  you  might  be  in  this  situation,  then immediately check  with  the bank or  finance  company  that  provided  the  car  loan  to  see  if  you purchased  GAP  Insurance  when  you  financed  the  vehicle.  GAP  Insurance  pays  the  difference between the fair retail value and the balance owed on the vehicle. The finance company can provide you with information and claim material for this type of claim.

CONSUMER TIP #1:

If you think the adjuster’s valuation of your vehicle is low, ask the adjuster to provide you with the valuation report. Most reputable insurance companies will allow their adjusters to provide a copy of this report to claimants [typically, referred to as a CCC Valuation Report].  Review the valuation report to make sure information about  your vehicle was correctly  entered.  Mistakes in details such as mileage, options, transmission type, and/or engine size can make a difference in the reported fair retail value of your vehicle

CONSUMER TIP #2:

GAP Insurance should be purchased if there is little or no equity in the vehicle; however, check with the dealer and/or finance company to make sure you can drop the GAP coverage once the equity and fair  retail value of the vehicle equals or exceeds the finance price. In other words once the “GAP” is gone there is no longer a need for GAP Insurance.

Additional Questions?

Boteler, Finley & Wolfe
www.bfw-lawyers.com

251-433-7766
550 Dauphin Street, Suite 505
Mobile, AL 36606