Stolen Car and Value

by Rebecca

Thanks for the great forum, my car was stolen in October of this year. My insurance company says that their only obligation is to my Lein holder. I have checked NADA and Kelly Blue Book for the value of my car and their settlement amount is far below the blue book value.

What should I do? I did have Comprehensive Coverage on the vehicle but unfortunately I did not have rental coverage. Not only am I out a car, but now I had to borrow a vehicle from family until this is settled.

Am I entitled to the amount that NADA and Kelly list as retail value? My lien holder agreed to a settlement of 3,900.00. The insurance company gave a value of 4,075.00 plus taxes. Am I entitled to any money from this fiasco?



Answer:


Couple of things:

Your insurance company has a duty to you first. You are the insured. However, there is a Financial Responsibility clause in your policy that makes them pay your lien holder first. If the total loss value (what they will pay you) is more than the loan, then you would receive the difference between the two.

If what what they settle for is less than what you owe in your loan, then you will be upside down, meaning that you would have to pay the remainder of the loan. This is unfair if your car was stolen and you have no fault of your own.

Banks and lenders sell something call GAP insurance, it is only sold when you are buying the car. It is insurance to cover the GAP between the total loss value and the amount left on the loan. We are assuming you did not buy this when you first got your car. If you did, then they would take care of that, if they don't, then you can be left paying in a loan for a car that you do not have.

Regarding the Fair Market Value. check our website with several articles about the total loss process and how to document your value. To answer your question here, the NADA or KELLY BLUE BOOK values are NOT what insurance looks at.

Those values are very subjective. They take into account national averages and other factors that are not really related to your local market. Therefore their values will not yield a fair MARKET value because there is data from other Markets.

Look over the paper and see if you can find similar vehicles to yours, those values would be somewhat accurate as they are in your local market.

Good Luck