If there is one law that is completely broken, it is this one. The insurance company is only required to pay a fair market value of what the car is worth at the exact time of accident. This does not take into consideration that had you not been involved in a car accident, you would have continued to make payments and at some point, you would no longer be upside down in your vehicle. Everyone knows that your car is not worth what you paid for it during the first few years of ownership, but the idea is to hang onto a car and at some point, if you hang onto it long enough, you will no longer owe more than the car is worth.

Sure, you can purchase GAP insurance, and under the current system that is probably a good idea, but can’t we come up with a better solution? What if we tell the highly profitable insurance companies that they owe 110% of the value on a totaled out vehicle? After all, they should be the ones penalized for totaling out a vehicle, not the consumer.

Unfortunately, we are stuck with our current system for car accidents. Under a perfect system, we wouldn’t have to owe anything on a totaled out vehicle. It would just be totaled out and the loan completely paid off. Until that day comes, be aware that you will be on the hook for owing the difference between the value of your car and your loan amount should your car be totaled by the insurance company.

Insurance companies want you to use their partner shops because they may have incentives in place with those body shops. These partnerships often times will save the insurance companies money on repairs to damaged vehicles. This might mean you get after market parts or repaired parts because they are cheaper than OEM (Original Equipment Manufacturer) parts. This saves the insurance company money and can have an effect on your claim. If the damage to your vehicle with brand new OEM parts costs $1200 but the cost to use repaired parts only cost $800, the insurance company may argue that your impact was so small that you should not be injured.

In the personal injury claims business, their is a huge difference in the value to claims between accidents with property damage to the vehicle totaling over a $1000 versus claims with damage less than $1000. So when you need to get your car fixed, don’t let the insurance company try to bully you into using their partnership auto body shops. Get a few estimates on your own and take it to a body shop that you want to use.

1. Waiting to seek medical attention. The longer you wait to see a doctor after an accident—even if it’s to see if you can get better on your own—the harder time you’ll have convincing the at-fault insurance company you were injured.
2. Failing to properly report the accident. This means you either didn’t file a report with the police at the scene of the accident or didn’t take pictures of the damage to your vehicle and injuries sustained.
3. Divulging too much information to the insurance company. Recovery from an injury takes time. Nevertheless, insurance adjusters will try and get you to commit to an injury, often the same day of the crash, even before a doctor has properly diagnosed and treated you. This is an attempt by them to reduce a payout to you. Don’t do it unless you want to minimize your claim (Simply say “I’ll know more once I finish treatment with my doctor.”)
4. Waiting to file a claim. As soon as you are able (the day of, if possible), file a claim with the insurance company. This can be done by you or an attorney, the latter of which can be added to your original claim at anytime, so long as a settlement hasn’t been reached.
5. Exaggerating or lying about your injuries. Don’t do it unless you want to kiss your legitimate recovery money goodbye.
6. Failing to complete medical treatment. If you skip visits or fail to complete your treatment, the insurance company will argue you weren’t really hurt in an accident. Stick to the program unless your doctor says otherwise, even if you feel you are getting better.
7. Exaggerating or lying about personal mobility. Some people do this in an effort to inflate their general damages award (aka “pain and suffering”). This is an auto accident, not the lottery. So for the second time, don’t fudge the truth. Be honest so you can get compensated for your injuries and loss of life (if any).

For a more comprehensive explanation of personal injury recovery, please see our Settlement Booklet.

Case Study

Gender: Female

Age: 30’s

Type of accident: Female was rear ended and had her car totaled out

At-fault insurance company: State Farm

Type of medical care: ER the day of the accident with follow up care at the chiropractor

Length of treatment: 4 months total

Settlement amount: Her total money offer (medical bills and pain and suffering) was 2.35 times the total medical bills.

Example: $4,000 in medical bills times 2.35 equals a $9,400 total money settlement from State Farm.

Things to note: The reason why large impacts can generate a larger settlement has to do with how a jury perceives larger impacts. It’s really easy to understand, a jury can relate more to a roll over and the associated damage and a higher chance of injury more so than a minor fender bender. Because of this, juries will often award more for larger impact accidents. If you are involved in a high damage accident, you should be able to get a larger award from the insurance company.

That statement is probably true. The problem with the logic behind the statement is you made the choice to take on the new car payment all on your own. You see, when you have your car totaled out in the accident, the insurance company has a responsibility to replace your car with the exact same car. They should pay you an amount that will get you into the exact same car. Nothing newer. Nothing nicer.

If you then go out and buy a newer or nicer car and you choose to take on that new added payment, that stress was brought on by you, not the insurance company and their driver. Because you have already settled on the property damage, you can’t bring things related to the property damage into your personal injury claim. They are two separate claims. That includes the added stress of buying a new car and taking on a new payment. So remember this, the insurance company has an obligation to right the wrong that their driver caused to your life. They do not have an obligation to make your life better than it was. Before the accident you were driving an older paid for Honda Civic so why would they have an obligation to put you into a new Porsche and make your payments for you?

This is the one area that really messes people up after an accident. They don’t think it through clearly when the accident happens and they end up added stress to their life that is brought on by themselves by taking on a new car payment. This stress cannot be added to their personal injury claim for pain and suffering. So be smart and don’t jump into a new car payment that you really can’t afford hoping that the insurance company will pay for it.

Luckily for you, I will be documenting the whole ordeal on CarCrashAssist.com to show you that the information contained on this site and in our Settlement Booklet™ can help you navigate the waters of insurance claims and help you get the most value out of your personal injury settlement.

I recently posted an article on the importance of taking pictures of the accident scene, especially the property damage and injuries. Right now my wife doesn’t have any bruising, so we didn’t need to photograph any injuries, but I did get some pictures of the property damage. Here is the reason you need to take pictures whenever you are involved in a car accident:

Notice that it looks like very little damage has happened to the rear of our car. We drive a 2008 Toyota Camry. Newer cars are designed to take most of the damage underneath the bumpers and it makes it appear that this was a low impact accident. However, when you see the car that hit her, it tells a completely different story.

Notice the amount of damage to his bumper. Additionally you will see that his hood sustained damage. This accident all the sudden looks more severe than if you only saw pictures of our car. Granted, this is not a high speed accident, it probably happened under 15 mph, but medical documents will show that you can sustain a severe whiplash at just 5 mph and this is clearly above that speed.

You wouldn’t get the whole story without seeing the other vehicle. If I hadn’t took pictures myself, I can guarantee that the insurance company would have mysteriously lost their pictures if we end up having to go to court. Now I don’t have to worry about that because I took pictures myself.

By the time that I showed up to the accident (I work less than 10 mins away), my wife had an immediate onset of neck and back pains and headaches. Wanting to have her evaluated by a doctor, I took her to the nearest ER. Next time I will cover the ER visit and our first call with the insurance companies.

Now that you have a shiny new camera phone, what should you be taking pictures of? Everything! Don’t let the other person move their car until you get lots of pictures of the damage, the accident scene, bruising, cuts and bleeding, weather conditions, traffic conditions, or just about anything else you can think of. The more pictures the better so don’t be timid in documenting the accident.

The reason you want to take your own pictures is because you can’t rely on the insurance companies to document your accident fairly. For example, you may be driving a pickup that has a trailer hitch. If the person that hit you was driving a compact car like a Honda Civic, their car may be totaled out, but your truck may have little to no damage at all. Does this mean that the impact was not severe enough to injury you? Of course not. However, the adjuster may try and make that very argument with you. The problem you will face if you did not gather your own pictures, will be trying to overcome this argument if you do not have your own evidence. Do you really think the adjuster will just give you his pictures of their totaled out car? Don’t count on it.

Injuries are another important thing to document with pictures. If you have bruises, they will eventually heal and how will the adjuster know how severe they were if you didn’t take pictures of them. Scars fade over time, so take pictures along the way to show how long you had to live with the scar before it finally faded. Did you have blood all over your face? A jury would surely love to see those graphic pictures when trying to assign value to your claim.

If you are the one person in the United States that does not have a cell phone with a camera, please at least buy a disposable camera and stash it in your glove compartment. Eye witnesses are good to have, but pictures never lie.

Unfortunately, that’s not the way it works. Just because you had your car totaled out does not mean that the at-fault insurance company has to buy you a brand new car. The most they will be responsible for is paying you fair market value for your car that was totaled out. Let me give you a real life example:

Years ago, when I was 18, I was involved in an accident. I was driving my 1972 full size Chevy Pickup. It had rust all over, but it was the perfect truck to take out in the desert and go rabbit hunting with. It just wasn’t a very good truck to take the ladies out on a date. Long story short, the accident happened and the truck was totaled. I immediately got very excited thinking that I could finally get a brand new truck. One that was not only good for hunting rabbits, but one that was good for dating as well. Imagine my shock when the at-fault insurance company offered me… $100. What? How was I going to buy a brand new truck for $100, let alone buy a replacement truck?

Unfortunately for me, that happened to be the market value for a 72 rust bucket Chevy pickup with bald tires. Luckily, I found a 78 Chevy pickup for about $500. It was newer, so of course it cost a little more.

So remember this, when your car gets totaled out, don’t go buy a brand new car unless you can handle the new car payment. It’s not the insurance company’s responsibility to pay you for the new car or the payments. It is their responsibility to pay you market value for your old car and you should be able to get into a comparable car as the one that was totaled out with little or no additional cost to you. That is assuming you aren’t upside down in your old car.

Animals fall under the property damage of your claim. The animal falls under the same category as gold clubs being ruined or a car seat that needs to be replaced. So what that means to you is when you get your car fixed, make sure to let the adjuster know that you had an animal that was injured in the car accident and that you want the animal’s medical bills paid for. Make sure you compile all the veterinarian charges and submit them to the adjuster at the same time you submit the estimates for your car repairs.

Because animals are considered property damage, the insurance company is only responsible for the cost to replace the animal if it died in the accident. If you had a $20 pound cat, the insurance company will only be required to pay you $20 to replace it. This can be a hard thing for people to understand because the animal is often considered a part of the family. The best thing to do at that point is try and get a little more money in your pain and suffering claim, but be aware that you will probably never recover the full sentimental value you had for the animal.