My Car is Wrecked - Now What? - Part II

What Other Damages Are You Entitled to Recover?

In addition to getting a rental car reimbursement, you may be entitled to compensation for the following (so make sure you ask):

- Loss of Use: Under Georgia Law, loss of use is generally calculated by looking to the cost of a reasonable rental of comparable property. Therefore, you generally can only get this recovery when, for whatever reason, you didn’t get a rental car. You are only entitled to loss of use damages for the period of time that your car is being repaired. Special note: You are not entitled to loss of use damages when your car is declared a total loss. There is some case law indicating that a claimant is entitled to loss of use damages between the date of the accident and the date that the insurance company decides whether to total your car.

- Diminished Value: Also referred to as diminution of value, diminished value is a damage that is recoverable when an insurance company elects to repair a vehicle rather than total it. Diminished value damages acknowledge that a vehicle involved in an accident is less valuable than one that has not been wrecked. There is no universally accepted method for determining diminution of value. For purposes of this book, it is probably sufficient for you to know that you are entitled to diminution of value and to get the adjuster to pay as much as you can.

- Cost of repairs: This one is relatively straightforward. If the insurance company elects to have your car repaired as opposed to totaling it, you are entitled to compensation for the costs of “reasonable” repairs.

- Market Value: This measure of damages is recoverable only when your car has been declared a total loss, i.e. it has been “totaled.” Georgia Law requires that you be paid for the fair market value of your car or truck immediately before the accident.

How To Determine Market Value

As I stated above, if your car is declared a total loss you are entitled to be paid the fair market value of your destroyed vehicle. While there is no stated formula for determining fair market value, it has been my experience that the best way to get a good idea of the value of your car is to use the N.A.D.A. Guide. You can get this guide on the internet at www.nadaguides.com.

Please keep in mind, an insurance company is not required to give you the exact value stated in the NADA. Most insurance companies use an independent appraising company called Auto Source Valuation, which finds a number of cars in your local area having the same characteristics as yours.

Remember, there is no set formula for determining fair market value. You are not bound to the insurance company’s valuation and they are not bound to yours. However, as I stated earlier, it has been my experience that the NADA is pretty close to what you can expect for your car.

Practice Tip: When inputting the information about your car on NADA, be honest. If your car is a hoopty don’t describe it as being in excellent condition. Believe me, the adjuster will know. If the adjuster thinks you are lying or if you insist your car is nicer than it really is, you will lose credibility with the adjuster.