Property Damage Basics

When are you entitled to a rental vehicle?

At some time, most of us have been in a fender-bender which is not our fault and we want to get our vehicle repaired to our satisfaction.  What are the rules about what we have a right to expect?

• If you vehicle is damaged and repairable, but not drivable, you can get a rental vehicle the same day, and you keep it until your vehicle is repaired.
• If your vehicle is damaged, repairable, and drivable, you get a rental vehicle while your vehicle is in the shop being repaired.
• If your vehicle is totaled, you can get a rental vehicle the same day until you are paid for the wrecked vehicle, when presumably you can buy another one, which you no doubt have been looking for since learning your vehicle was totaled.

What do they have to pay me for my damaged vehicle?

First of all, you are generally not entitled to direct payment if your car is repairable.  The insurance company can, and generally will, pay the repairs directly and pay for your rental vehicle.

You are entitled to have your vehicle repaired with the same or similar parts.  The insurance company is not required to pay for brand new replacement parts unless your vehicle is brand new.  But, they must use quality parts of the same make and model and year of your vehicle in good condition that fit and work well.  You can ask for new parts, but you are responsible for the difference.  the idea is to put you back where you were.  If you have a five-year-old car and you get brand new parts, then you are not where you were, but better off.

If the repair shop finds additional damage while the vehicle is being repaired, you are entitled to have that paid for also.

In addition to direct repair costs, you are entitled to the loss of value of your vehicle, if any, since it is now a wrecked vehicle.  This is a more difficult issue to establish.  It is helpful if you can get statements or affidavits from people knowledgeable about vehicles in general, and hopefully your vehicle in particular.  Talk to the dealership which sold you your vehicle, or a repair shop that is familiar with your vehicle's brand, or even better, your vehicle.

If your vehicle has sustained damage of at least 25% of the value at the time of the damage, you are generally required to disclose that information later on when you sell that vehicle.  It is important that you try to determine how much less your repaired vehicle will be worth in the marketplace in comparison to a vehicle that is not damaged.

If your vehicle's repair estimate is greater than 75%of its fair market value, then it must be totaled.

If the vehicle is totaled, you are entitled to the fair market value of your vehicle at the time of the damage.  The vehicle will have some salvage value, and if you keep that salvage and sell it yourself, those monies belong to you.  If you do not want to sell the salvage, the insurance company will pay you some generally nominal amount for the salvage.  They will sell it,since it then belongs to the insurance company.

If your vehicle has been totaled, you are not entitled to have your vehicle loan paid off if it is for more than the fair market value of the vehicle.  Your loss is the value of the vehicle, not what is owed on it.  A helpful way to think about this is: What if only $500 was owed on a vehicle otherwise worth $3,000?  You would not want to take the amount owed on it.  At first, it seems unfair if your loan does not get paid off, and it is a real financial hardship.  But, when you think about it, it makes more sense.

What if the insurance company will not pay me what  my vehicle is worth?

If you are unsure about the value of your vehicle, use a NADA (National Auto Dealers Association) book to determine the value of your vehicle.  Your banker should have access to this book since they make vehicles loans and use it frequently.  They are often available at the public library as well.  Also, look in the newspaper or on the Internet to see for what amount other vehicles of similar make, model, and year are selling.  If you are still not certain, call our office at (336) 725-2900 and someone in our litigation department will give you some additional pointers as a courtesy.

If you have additional questions, consider contacting your insurance agent and ask them for some direction.  

DISCLAIMER:  This information is provided as a public service.  Information contained is not intended as, and should not be taken as, legal advice.  The use of information provided in this summary should not be taken as establishing any contractual or other form of attorney-client relationship between Wells Jenkins Lucas & Jenkins, PLLC, and the reader or user of this information.