One of the most stressful situations people encounter with auto claims is determining the value of the vehicle or damage.

The Process

When you file your claim it will be referred to a claims adjuster who will verify the loss and determines the costs to make the necessary repairs.  The estimate provided by the adjuster can then serve as a benchmark to do your own comparisons.

Insurance companies will not require you to sign an agreement accepting their estimate as total claim payment until you feel comfortable with the offer. If you are not satisfied with the provided estimate, then it is highly recommended that you get at least one estimate from a trusted mechanic.

While your insurance company cannot require you to have repairs done at a particular shop, they can require you to obtain more than one estimate for the damage.  The insurance company will want to verify they are not overpaying for the damages.

Don’t be surprised when your insurance company chooses to pay for the lowest bid.  Remember you don’t have to accept the lowest bid, but that you will need to prove that bid doesn’t adequately provide the necessary repairs.

Also, one of the reasons why your bid may be lower than anticipated because of betterment.  Betterment is when repairs performed actually increase the value of your vehicle leaving you in a better position than before your claim.

It is up to your insurer to decide whether to pay for repairing your car or to declare it a total loss and pay you its book value. Most standard auto policies will not pay to repair a vehicle if the repairs cost more than the cash value assigned to the car.

There won’t be any dispute about whether to repair the car if it was completely totaled. But you may argue about what the pieces of the car were worth when they were assembled as a car.  There are several standard guidelines used to determine the value of a vehicle.  Guides published by the National Association of Automobile Dealers and Kelly Blue Book are good places to start.

Customers often ask us exactly what each coverage on their auto insurance policy does.  As policy language can be complicated and confusing, it can be difficult to understand how your policy is supposed to react in the event of a claim.

The Insurance Information Institute put together a nice infographic that outlines what each coverage is on an auto insurance policy and how it is designed to react in the event of a claim.  As always, if you have any coverage questions at all, please feel free to give our office a call.

Depending on its age and condition, a car that has been in a major accident generally has less resale value than the same vehicle in pre-crash condition. Even if the car repairs meet the highest quality standards, potential buyers are unwilling to pay as much for a car they know has been previously damaged.
This difference between what the pre-accident car was worth and the market value of the post-repair car is known as diminished value.
Note that diminished value doesn’t apply to all cars that have been damaged and repaired. Older model cars may actually be worth more after an accident because new parts have been substituted for many of the old parts.
Will my insurance company pay for diminished value?
A diminished value loss may or may not be covered, depending on a number of factors, including who was to blame for the accident, coverages provides by your policy and state regulations.
If the accident is your fault
Except in a very few states, the language in the collision section of the standard auto insurance policy clearly excludes coverage for diminished value when the policyholder is at fault in a crash.
That means that if your car policy includes optional collision coverage and you ram your car into a lamppost, your insurer will pay for repairs to the car, minus the deductible. However, in most cases, the company would not compensate you for diminished value.
If the accident was clearly caused by another driver
In all states except Michigan, if an accident is the fault of another driver, you would receive compensation for diminished value. This is because legally the third party has an obligation to make the victim of the accident “whole” again; in this case, to restore the victim’s car to its pre-accident fair market value.
In other words, the at-fault driver’s insurer is responsible for repairing your car and for paying you the difference between the car’s resale value before the accident and after the repair. This cost is usually covered by the liability portion of his or her insurance policy.
If the at-fault driver is uninsured and cannot pay for repairs, receipt of payment will depend on whether you have purchased uninsured motorist’s coverage. About half of the states allow recovery for diminished value under this coverage.
Proof of diminished value
In order to recover the amount by which the car’s value has been diminished (whether under the at-fault driver’s liability policy or under the policyholder’s own uninsured motorist or collision coverage), it is the policyholder’s responsibility to prove the repaired vehicle is worth less than before the accident. Payments may be reduced by the degree to which the policyholder was to blame for the accident.

1. Your Coverage And Deductibles

Car insurance providers allow you to choose your deductible and decide whether to add additional coverage that isn’t necessarily required by the laws in your state. The specifics of your coverage and deductibles play a major role in your monthly payment.
Additional coverage gives you added financial protection, depending on the claim, but will also add to your monthly costs. Remember that while adjusting your deductible will affect your premiums, the differences in premiums are usually very small.

2. What You Drive

Some insurers increase premiums for cars more susceptible to damage, occupant injury, or theft, and lower rates for those that fare better than the norm.
Some SUVs, for example, rate highly in terms of driver protection and passenger protection, which means discounts on insurance. While some small cars will cost more because of their lower-than-average safety ratings and desirability to car thieves make them more expensive to insure.

3. How Often, And How Far, You Drive

People who use their car for business and long-distance commuting normally pay more than those who drive less. The more miles you drive in a year, the higher the chances of an accident – regardless of how safe a driver you are. If you reduce your total annual driving mileage enough, you may lower your premiums.

4. Where You Live

Generally, due to higher rates of vandalism, theft, and accidents, urban drivers pay more for car insurance than do those in small towns or rural areas.

5. Your Driving Record

Drivers who cause accidents generally must pay more than those who are accident-free for several years.
And even though you can’t rewrite your driving history, having an accident on your record can be an important reminder always to drive with caution and care. As time goes on, the effect of past accidents on your premiums will decrease.

6. Your Credit History

It has been shown certain credit information helps predict future insurance claims. Where applicable, many insurance companies use credit history to help determine the cost of car insurance. Maintaining good credit can have a positive impact on the cost of your car insurance.

7. Your Age, Sex, And Marital Status

Accident rates are higher for all drivers under age 25, especially young males and single males. Insurance prices in most states reflect these differences.
If you’re a student, you might also be in line for a discount. Most car insurers provide discounts to student-drivers who maintain good grades. In some states, younger drivers are also able to take driver safety courses that will lower premiums.
Thanks to mobile phones, a vehicle breakdown is usually more of an inconvenience than a real danger. A quick call to a tow truck or roadside assistance service will usually get you to safety within a couple of hours. But technology can fail, and there are still parts of the country that aren’t covered by cellular service. So to make sure you’re prepared for an unexpected breakdown, keep these 6 items in your car at all times:
1. Jumper cables
Most people have jumper cables in their car, but many drivers don’t know how they work. Familiarize yourself with how to use jumper cables so you can get to work on time after leaving the dome light on all night.
2. Spare tire, tire iron and car jack
Spare tires and tire-changing equipment are also included in most new cars. Just as with the jumper cables, you should familiarize yourself with how to change a tire, even if you plan to use roadside assistance when you have a flat. Flat tires are the most common cause of breakdowns, and you should know how to change a tire if help is unavailable.
3. Blanket or sleeping bag
For more serious situations, keep a warm blanket or sleeping bag in your car. This is essential to keeping your body temperature up during the cold months while waiting for help to arrive.
4. Drinking water
Along with keeping warm, staying hydrated is an essential element of survival. Keep clean drinking water in smaller plastic containers, which will thaw faster with a little body heat in the winter than large gallon jugs.
5. Mobile phone and charger
A charged mobile phone is your best chance at getting out of a serious situation. Whether you’ve been injured after a crash, or your car simply stopped working, being able to call for help when you need it is essential.
6. Emergency lighting
You shouldn’t assume that every breakdown will happen during the day. Road flares or reflectors can keep you safe on the side of the road by making you visible to oncoming traffic and emergency vehicles. And a flashlight with extra batteries can be a lifesaver if you’re changing a tire or jumping a battery after dark.
By keeping these 6 items in your vehicle, you’ll be able to handle most roadside emergencies throughout the year.

Did you know that between Memorial Day and Labor Day an average of eight teens are killed every single day?  This is according to statistics from Tire Rack Street Survival, a national nonprofit teen driving program.
It’s no surprise that teenage drivers are at the highest risk to be involved in auto accident.  They don’t have experience to respond and react to dangerous situations on the road.  This explains why teenage auto insurance rates are so expensive.
So to help protect our Denver Metro and Arvada clients, we have put together a list of recommendations to keep your teenage driver safe on the road (and help keep your auto insurance rates down in the process).  Many of these recommendations come from a great article posted by the Insurance Information Institute (
1. Don’t Allow Friends in the Car.  Did you know that when there is a teen passenger in the car, your child’s chances of being involved in an accident double?  And if there are 3 or more passengers, the chances actually quadruple?   Teens can be distracted very easily when driving which is why recommend they drive alone in the car.
2. Pick a Safe Car.  Avoid small cars with high performance engines.  Rather choose a car that is easy to drive with great safety features.  Also, trucks and SUVs should be avoided as well because of they are prone to rollovers.
3. Enroll Your Teen in a Safe Driver Program.  Did you know that many auto insurance companies will actually offer safety driving programs?  By enrolling your teen into one of these programs, you will not only be encouraging safe driving habits from your teen, but you will also be eligible for discounts on your auto insurance program as well.
4. Avoid Distracted Driving. Do not allow your teen to use his or her cell phone while driving a vehicle.  Also, talk to them about avoiding other distractions such as the radio or friends while in the car.
If you have any other questions or you would like to find out more about the eligible discounts your teenage driver may qualify for, please give our office a call.

As we’ve all seen recently in the news, hurricanes (and the floods that result from them) can create enormous damage to properties and vehicles. In fact, one recent estimate from Hurricane Harvey, estimated over 200,000 vehicles would be totaled due to flood damaged.
If you are in the market for a new vehicle, be wary, as flood vehicles offer a tempting opportunity for criminals to defraud unsuspecting consumers. By definition, a flood vehicle has been completely or partially submerged in water to the extent that its body, engine, transmission or other mechanical component parts have been damaged.
If the vehicle is so damaged that it is no longer operable, the driver’s insurance company settles the claim by buying the vehicle and selling it as a “salvage” at an auto auction.
Dishonest and unscrupulous car dealers buy the vehicles, dry and clean them, yet leave plenty of hidden flood damage. They then transport the vehicles to states unaffected by the storm or natural disaster and sell them as used vehicles to unsuspecting buyers.
These dishonest dealers will not disclose the damage on the vehicle’s title as they are required, which is a crime called “title washing.” The vehicles are then sold with the hidden damage.
Below are some tips to help you avoid purchasing a vehicle that may be flood damaged.

Fraud prevention tips
Consumers can take preventive measures before purchasing a used vehicle to avoid being victimized by flood vehicle fraud:

  • Select a reputable car dealer.
  • Inspect the vehicle for water stains, mildew, sand or silt under the carpets, floor mats, headliner cloth and behind the dashboard.
  • Check for recently shampooed carpet.
  • Inspect the interior upholstery and door panels for fading.
  • Check for rust on screws in the console or areas where water normally doesn’t reach.
  • Check for mud or grit in the spare tire compartment, alternator crevices, behind wiring harnesses, around the small recesses of starter motors, power steering pumps and relays.
  • Check inside the seatbelt retractors by pulling the seatbelt all the way out and inspect for moisture, mildew or grime.
  • Check door speakers as they will often be damaged due to flooding.
  • Have a certified mechanic inspect the vehicle prior to purchasing it.
  • Ask about the vehicle’s history. Ask whether it was in any accidents or floods.
  • Inspect the title and ownership papers for any potential or questionable salvage fraud.
  • Conduct a title search of the vehicle.
  • Look under the hood for signs of oxidation. Pull back rubber boots around electrical and mechanical connections for these indicators: Ferrous materials will show signs of rust and copper will show a green patina
  • Aluminum and alloys will have a white powder and pitting.
  • Trust your instincts: If you don’t like the answers or the deal sounds too good to be true, walk away!

In part 1 of our blog post on the auto insurance policy, we explained the most basic auto insurance coverages and how they can protect you and your car.  In this post, we’re going to add some additional specialty coverages that can be included on your auto insurance policy.  Many of these coverages cost very little and can provide additional protection that can greatly help. To find out how to add these coverages to your auto policy, please feel free to contact our office.

  • Custom Parts or Equipment (CPE) – Collision and Comprehensive coverage each provide up to $1,000 of coverage for custom parts or equipment, which are accessories and enhancements permanently installed in or on your vehicle. Parts and equipment offered by the manufacturer or installed by the dealer at the point of sale are not custom parts or equipment, but they are included under your standard Collision and Comprehensive coverage.
  • Additional Custom Parts or Equipment (ACPE) – This coverage is available if you have more than $1,000 of custom parts or equipment on your vehicle. If you purchase this coverage, the insurance company will pay for custom parts or equipment damaged as a result of a covered incident, up to the amount shown on your Dec Page.
  • Rental Reimbursement – If you buy Rental Reimbursement coverage, the insurance company will reimburse you for rental car charges incurred while our vehicle is being repaired after a covered accident. You can only buy Rental Reimbursement if you buy Collision and Comprehensive coverage. Rental Reimbursement may be limited to 30 days and subject to the maximum per day amount shown on your Dec Page.
  • Loan/Lease Payoff – This coverage protects you when your covered vehicle has been deemed a total loss and you owe a lender more money than the vehicle is worth. If you buy Loan/Lease Payoff and your vehicle is declared a total loss, Loan/Lease Payoff will pay the difference between the vehicle’s actual cash value and the amount you owe to the lender. However, the maximum the insurance company will often pay is 25 percent of the actual cash value.
  • Roadside Assistance – If you incur labor costs at the place where your vehicle becomes disabled as a result of a mechanical/electrical breakdown, dead battery, flat tire and/or lockout, Roadside Assistance can cover those costs. Many insurance companies also will help if you run out of gas or other fluid, or if you become stuck in snow or mud within 100 feet of a road or highway. And, if necessary, Roadside Assistance will cover towing to the nearest qualified repair facility.

There’s nothing like the smell of the grass after a long, hard rainstorm or the sunshine glistening water off the trees.  Problem is that storms also leave another present — potholes. And if you’ve hit one before, you know that dreaded feeling; the heavy thud, praying the flat-tire light doesn’t come on, listening for the telling grinding of some loose part in your car.
Pothole damage accounts for nearly 500,000 insurance claims every year so here are some tips to avoid potholes:

  • Leaving more space between you and the driver ahead of you. This is just general good driving practice, but it comes in handy avoiding potholes too. After all, the more space between you and the other guy, the more likely you are to notice a pothole and calmly dodge it.
  • Slowing down. Ratchet your speed back a little bit to improve your reaction time. Also, hitting a pothole at lower speeds typically doesn’t cause as much, or as serious damage as hitting one at higher speeds.
  • Watching out for water. After a rainstorm or snow, potholes can fill with water. That makes them harder to see, and harder to judge how deep they are.