A common property damage issue is if your vehicle is considered a “total loss”, or you think it might be a total loss. You have been in an accident, the insurance company says your vehicle is a total loss, and they are making an offer. You obviously want to make sure the offer is fair. Your first question is “What is the total loss value of my vehicle?”
You need to know what your vehicle’s value is to know if you are receiving a fair offer from your insurance company. Your vehicle’s value is determined by several factors, but there is no way to put an exact dollar figure on the value of your vehicle in most situations.
The insurance company is paying you for your total loss. This means they are buying your vehicle, and you are selling it. Think of it in those terms. When you purchase a vehicle there is the sticker price, and then you negotiate from there. It is the same process when determining the value of your vehicle – but instead of being the buyer, you are now the seller.
If you have suffered a total loss with an injury, and need an auto accident lawyer in Dallas, call (972) 599 4100.
SOURCES TO USE FOR THE TOTAL LOSS VALUE
You need some evidence on your side to help you with your negotiations with the insurance company for the value of your vehicle. I suggest using three sources of information in determining the value of your vehicle. For most typical automobiles I suggest using these three sources:
1) NADA – https://www.nada.com/ – NADA is a traditional source that insurance companies have historically used to get an estimated value of vehicles.
2) KBB.com (Kelley Blue Book) – https://www.kbb.com/ – Kelley Blue Book is a traditional source that insurance companies have historically used to get an estimated value of vehicles.
3) Vehicles for Sale – Online sources that are actually selling vehicles, such as autotrader.com, cars.com, or edmunds.com (possibly a combination of all 3 of these sources). You can also use other local sources such as craigslist.org and search the autos for sale on their site. The following sites can be used to find vehicles for sale in your area:
- Autosite – https://www.autosite.com/ – This is a site that gives estimated pricing on vehicles. You can also search for vehicles for sale at dealerships.
- Edmunds – https://www.edmunds.com/ – This is a site that gives both estimated pricing on vehicles and allows you to search for vehicles for sale at dealerships.
- Carfax – https://www.carfax.com/ – This is a site that gives both estimated pricing on vehicles and allows you to search for vehicles for sale at dealerships.
- Auto Trader – https://www.autotrader.com/ – This is a site that gives both estimated pricing on vehicles and allows you to search for vehicles for sale at dealerships. Auto Trader ALSO gives you the option of searching for sales from individuals who have listed their vehicle.
- Cars.com – https://www.cars.com/ – This is a site that gives both estimated pricing on vehicles and allows you to search for vehicles for sale at dealerships. Cars.com ALSO gives you the option of searching for sales from individuals who have listed their vehicle.
- Craigslist – https://dallas.craigslist.org/d/cars-trucks/search/cta – Craigslist is designed for individuals to buy and sell products. When searching vehicles many of the listings appear to be from individuals. Many are also from dealerships as well.
At each of the above websites and sources put in the year, make, model, the package you had on your vehicle, mileage, and condition of your vehicle just prior to the accident. All the relevant information related to the type of vehicle you had. KBB.com and NADA.com will both give you a range of the value of your vehicle. They typically will be different prices – but will likely be fairly close to each other.
NADA and Kelley Blue Book both have been used for decades by insurance companies in getting estimated values of vehicles. Insurance company adjusters often deny it, but I can tell you based on my experience, as I used to be an insurance adjuster prior to becoming a lawyer, that the little Kelley Blue Book and NADA booklets were kept in the property damage appraiser sections of claims departments and were used as a reference.
Follow these 3 steps to arm yourself with information when it comes time to negotiate with the insurance company for the price of your vehicle:
1) Get value from KBB.com. Click on the tab at the top of the page called “car values”, and the subheading “price new/used”.
Next, fill in the “year, make, and model” of your vehicle, along with your zip code where you live, and click “next”. Near the top, click “get my car’s value”. The page will then ask you to enter the style of your vehicle. You will be asked to enter your color and options for your vehicle, and then the condition of your vehicle (fair, good, very good, excellent – this is the condition it was in just prior to the collision).
The results will show “trade-in”, “private party”, “instant offer”, and “donate your car”. You want the results of a “private party”. You are going to need to purchase a replacement, so you need to know how much it costs to buy another vehicle. It is not a trade-in, it is a purchase. Some adjusters will try to use “trade-in” values – this is not a legitimate offer if they use “trade-in” values, because you are unable to do a trade-in with a totaled-out vehicle. You need the actual purchase price ranges. KBB.com will both give you a range of values (high to low), and an actual estimate of the value of your vehicle based on the data they keep.
Write down or copy the results of this search.
2) Get value from NADA.com. Click on “Car Values” near the top of the page. Next click “Search Now” and it will take you to the page to start entering the details for your vehicle. Choose the manufacturer (Ford, Nissan, Chevy, etc). Then enter the year and make of your vehicle. Follow the guide to enter the package, mileage, and other details regarding your vehicle. NADA then gives you trade-in values and a clean retail value.
Write down or copy the results of this search.
3) Get value from actual Vehicles for Sale. Use sites where people are actually selling vehicles in your area. (Cars.com, Autotrader.com, Edmunds.com, Craigslist, etc.). Find vehicles within a 50-mile radius with the same (or as similar as possible) year, make, model, and mileage as your vehicle. If you do not get many results, increase the mileage radius to 75 miles or 100 miles and keep increasing until you get some results. Write down each vehicle for sale and the price.
Often you will get 2-3 vehicles during this search at the top where someone is asking a ridiculously high price and 2-3 vehicles at the bottom where the price is ridiculously low. The vehicles with the highest prices are often asking for a price that they will never get, and the people asking for the price at the bottom are asking that price because there is obviously something wrong with their vehicle (maybe it needs a major engine repair).
Kick the top and bottom values out – they should not be used to determine the value of a vehicle – they will only unfairly skew the prices one direction or the other. Take the middle values and get an average of what your vehicle is actually selling for in your area.
4) Compare the data from KBB.com, NADA.com, and Vehicles for Sale. After your research, see which of these 3 sources is the highest. If it is KBB.com, then that is the source you will use to start your negotiations with the insurance company, if the highest value is NADA.com then you start your negotiations with NADA.com’s info.
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NEGOTIATIONS FOR THE TOTAL LOSS VALUE
If Vehicles for Sale are the highest – then you use that data for your negotiations. Choose the highest source and use that as your starting point – because the insurance company will have done the same thing, and they are going to start with the lowest of these sources.
When you are dealing with the adjuster regarding the value of your total loss, you will pretend you have only heard of the highest value source, and have no idea what the insurance company is talking about if they use another source for the value of their vehicle. The insurance company will be doing the same thing, but coming from the lowest price.
If you are using KBB.com or NADA.com – you argue “KBB.com is the industry standard for determining the value of a vehicle”, if you are using NADA.com you use the same argument “NADA.com is the industry standard” – and they say the value of my vehicle is this amount. The insurance adjuster will be doing the exact same thing coming from the opposite direction.
This is a negotiation – just like when you purchased your vehicle – except the insurance company is the purchaser here now, and you are the seller. Just like any negotiation, they are not going to pay the highest price, but you are not going to accept the lowest price. There will be some give and take between you and the adjuster until you can come to an agreement on the value of your vehicle.
DO NOT FORGET TAX, TITLE, AND REGISTRATION
After you have agreed on the value of your vehicle, do not forget to ask for the money to cover tax, title, and registration on the new vehicle you need to purchase to replace the old one. If your vehicle has been totaled, you are required to pay the tax, title, and registration when purchasing another vehicle. You would not have had to pay this additional tax, title, and registration but for the accident.
Texas law is fairly silent on tax, title, and registration when it comes to total losses. There is only one statute in Texas that addresses the issue – and only addresses the “tax” issue. 34 Tex. Admin. Code section 3.62 states:
“The motor vehicle sales and use tax is not due where an insurance company takes title to a motor vehicle as a result of a total loss settlement or a stolen vehicle which was later recovered because the transaction in which an insurance company obtains title to a motor vehicle in return for an insurance settlement is not considered a sale. The motor vehicle sales and use tax is due when the insurance company purchases a replacement motor vehicle for the insured on a total loss or stolen vehicle claim. 34 Tex. Admin. Code § 3.62“
The statute above was either written in a different time when insurance companies actually purchased replacement vehicles for their insureds or were written by someone who doesn’t know how total losses actually work when dealing with insurance companies. The insurance company never actually buys another car for the insured with a totaled-out car – they just issue a check for the amount of the damage.
The language stating that taxes are due “. . . when the insurance company purchases a replacement” tells me that whoever wrote this statute never had to deal with a total loss – because the insurance company does not make any purchase of a replacement for the insured – that is left up to the insured person using their collision or comprehensive coverage to make the purchase with the funds delivered by the insurance company, or by the claimant in the case of 3rd party claims. Texas legislators write laws that can be off at times . . . and people wonder why there are so many lawsuits.
WHAT IF I WANT TO KEEP THE TOTAL LOSS VEHICLE?
Keeping the totaled-out vehicle means you will have to eat the cost of the “salvage value” of your vehicle. Some vehicles are total losses but still driveable. The damage doesn’t look that bad to the owner. The vehicle drives fine, it just needs some bodywork. In this situation, some people want to keep their vehicle even though the insurance company is totaling it out. You do have the option of keeping the vehicle – but the insurance company will reduce the amount paid for the total loss by the “salvage value” of the vehicle.
I never recommend this. Mainly due to my own personal experience when I was 18 years old and tried to do this myself. I used the total loss money to fix a totaled vehicle I owned at the time and do the repairs. The vehicle ran great afterward for a very short time . . . then it died within a few months. There were major mechanical issues that I did not know about that cost about as much to repair as I received for the total loss. I had already spent the money I received from the total loss on doing the body repairs and had nothing left for mechanical repairs. I should have used that money to buy another vehicle – instead, I was stuck with a car that looked nice, but that had mechanical issues that cost more than I had for repairs. Lesson learned. I always suggest using the money to get another vehicle – but that is your choice and decision to make based on your circumstance. Your vehicle might not have any damage to the engine.
If you decide to keep the totaled vehicle the insurance company will reduce their total loss offer by the “salvage value”. The salvage value of your vehicle is the money the insurance company would get if they sold your vehicle to a salvage yard. When they pay you the total loss value the insurance company has purchased the vehicle. They can then sell the total loss to a salvage yard to get some money back. The salvage value depends on the severity of the damage and if there are parts on the vehicle that can be used for repairs to other vehicles. Salvage value can typically range from a few hundred dollars to a few thousand dollars.
Often there are salvage auctions – you may be able to find a similar car to yours and see what it sold for at the salvage auction. This might help you determine whether to just take the total loss amount from the insurance company, or keep it and sell it for salvage yourself. The easiest route is to take the total loss value and let the insurance company deal with the salvage.
WHAT THE LAW OFFICE OF DOUG GOYEN DOES
The Law Office of Doug Goyen has been representing residents of the Dallas area for personal injury auto accident cases. Doug Goyen Law Office has handled thousands of car accident injury cases and obtained settlements totaling millions of dollars for their clients.
Call (972) 599 4100 if you need a Dallas auto accident attorney. We will get started on your case right away. If you need a facial injury accident lawyer, the Law Office of Doug Goyen can help. The Law Office of Doug Goyen offers experienced, aggressive, and powerful advocacy for our clients. In auto accident personal injury claims, our results are proven, dependable, and consistent in obtaining the full value of the settlement for our clients.
DIRECTIONS TO OUR OFFICE
Law Office of Doug Goyen
15851 Dallas Pkwy #605
Addison, Texas 75001
(972) 599 4100 phone
(972) 398 2629 fax
Directions to our office: We are on the southbound side of the service road to the Tollway. Stay on the Dallas North Tollway until you come to the Keller Springs exit. Take the Keller Spring exit. Stay on the service road on the southbound side and go just past Keller Springs. Our office is the 2nd building south of Keller Springs, located on the service road to the North Dallas Tollway in the Madison Business Center on the 6th floor.
By Doug Goyen, email@example.com