How Insurance Companies Handle Your Collision or Property Damage Claim
To quickly get your car back on the road or have your total loss settled, it is important to understand how the insurance company processes your property damage (PD) claim. In general, the process works like this: An inside adjuster assigns an outside appraiser to inspect the vehicle. The outside appraiser inspects the vehicle and then e-mails their repair estimate to the insurance carrier’s inside auditor. The auditor then reviews the appraisal and approves payment. The approved estimate is sent to the inside adjuster for check issuance. The problem with this process is that it takes the time and availability of three people to pay your PD claim. If any one person does not do their job efficiently, you suffer. Knowing the process, you can now coordinate the efforts of the carrier to assure the timely resolution of the PD claim.
The first step in a PD claim is to identify any storage problems. If there are storage problems, you need to mitigate (limit) your damages and move your car to a storage fee free location. It is then important to determine if the vehicle is repairable or a total loss. Many times, a call to the body shop will answer this question for you. The next step is to determine if you will present a collision claim to your insurance company or a property damage claim to the defendant’s carrier. If you present a collision claim to your carrier, they will fix the car first and ask questions later. The down side is that you must pay your collision deductible. If you present a property damage claim to the defendant’s carrier, they must first conclude their investigation to determine if they are responsible to pay for your damages. The plus side is that you don’t have to pay your deductible. The down side is it will likely take 30 days for the carrier to conclude their investigation. Once you determine which carrier will handle the PD claim, it is important to contact the inside adjuster and obtain the name and phone number for the carrier’s appraiser and then follow up on the vehicle inspection.
If the vehicle is repairable, identify the body shop that will do the repairs and contact them to confirm that the vehicle can be repaired. Also, determine if there is likely to be any supplemental damage that will require a re-inspection by the appraiser. Then identify if the vehicle has been inspected. If not, call the carrier to coordinate the inspection. You will need to follow up to confirm that the estimate has been approved, repairs have been completed or to coordinate supplemental inspections and carrier approval of supplemental repair estimates.
If the vehicle is a total loss, obtain a copy of the carrier’s market value report for the client’s vehicle and review it for its accuracy. Then you must complete the necessary DMV transfer documents, Vehicle/Vessel Transfer Form and Vehicle License Fee Refund Form (These can be ordered free of charge from the DMV). If you have a lien holder, provide this information to the carrier so that they can make appropriate payment to them. If you have clear title, you will need sign off on their title and give it to the carrier. Overnight the total loss transfer documents to the carrier so that they can issue their PD payment.
HELPFUL TIPS
PARTS USAGE:
Aftermarket parts – These parts are not manufactured by the car maker. Aftermarket parts are generally used for plastic items such as; bumpers, lamps, grilles and mirrors. They are also used as radiators and condensers. Aftermarket sheet metal may be used to reduce repair costs so that a vehicle is not declared a total loss. The usual complaint with aftermarket parts is that they do not fit well. If aftermarket parts are used, the carrier will generally only use CAPA certified parts (http://www.capacertified.org/home.asp). Many shops will use their own vendor for aftermarket parts that are not CAPA certified. This is done to reduce their repair cost and increase their profit.
LKQ/Used parts – These are used parts that were generally manufactured by the car maker. These parts are taken from already wrecked cars. LKQ parts are used for door assemblies, quarter panel assemblies, bumper assemblies, lid/gate panels, lamps, seats, trim panels, dashes, stereos, front and rear clips. These parts are usually used if the car is over one (1) year old and has over 12,000 miles. The issue with these LKQ parts is that they may not be available or they may require some shop cleanup before they can be used.
Remanufactured parts are original parts that have been repaired or resurfaced. These parts are usually used for wheels and bumpers. The issue with these parts is that the part repair may be inadequate. Bumpers can not be remanufactured if they are torn or their tabs are broken and wheels can not be remanufactured if they have large chips or cracks in them.
OEM parts are original equipment from the manufacturer. They are the most expensive parts and are used on vehicles with less than 12,000 to 15,000 miles.
TOTAL LOSS INDICATORS:
- Rollover – almost always a total loss;
- Speed of impact over 40 MPH;
- More than two panels are damaged;
- Moderate or greater front end damage;
- Vehicle value is less than $3,000.
TOTAL LOSS TOOLS:
1. Determine approximate vehicle value at www.kbb.com.
2. Speed settlements by providing DMV documents to the carrier when it is determined that the vehicle may be a total loss. The required DMV transfer documents are:
a. Vehicle/Vessel Transfer and Reassignment Form (REG 262);
b. Application for Vehicle License Fee Refund.
