Automotive: One Man Engine Drop

[Ken]

Ken’s formulas are incorrect. The correct formula will be left as an exercise to the reader.

If you have a big deductible that would be part of the formula as well, but isn't really going to change the calculation because the deductible is taken out either way, whether you get the car repaired or replaced.

[Josh]

Ken’s formulas are incorrect. The correct formula will be left as an exercise to the reader.

If you have a big deductible that would be part of the formula as well, but isn't really going to change the calculation because the deductible is taken out either way, whether you get the car repaired or replaced.

Nope. Still wrong.

[justme]

The correct formula will be left as an exercise to the reader.

that's not helpful

[Josh]

Ken issued a lengthy discourse explaining to us how automotive insurance works, so I figure he can go do the research to correct his formula.

I will begin to give hints: it involves a percentage.

[Ken]

Google "Total Loss Formula" (TLF) and you will find a lot of insurance web sites explaining the same exact formula I described above. Although as part of the repair costs they include the replacement rental cost so if, for example, repairs will take 10 days that would be 10 days of car rental to provide you with a car while your car is under repair. Which further reduces the threshold for totaling the car.

Some states have percentage-based caps, often around 70% which mandate that the car be "totaled" if repair costs meet or exceed that percentage threshold. But those are nothing more than caps. The insurance companies can and do apply their own propriety TLF to determine whether to total a car even if the repair estimate is under the percentage threshold. And they often do for a variety of reasons.

Here is an example from Ohio where insurance companies use the TLF formula that I described: https://wallethub.com/answers/ci/ohio-t ... 140750675/

[Josh]

Why are you talking about Ohio?

[Ken]

Why are you talking about Ohio?

To illustrate a point.

Pick Washington then if you want. it works the same here too.

[ohio jones]

Why are you talking about Ohio?

To illustrate a point.

Pick Washington then if you want. it works the same here too.

That won't be of much benefit to t1, in the unlikely event you're more interested in helping her than arguing with Josh. Nor would Texas or Alaska.

[Ken]

Why are you talking about Ohio?

To illustrate a point.

Pick Washington then if you want. it works the same here too.

That won't be of much benefit to t1, in the unlikely event you're more interested in helping her than arguing with Josh. Nor would Texas or Alaska.

It is the same formula in Illinois as well.

I don't know that there is much any of us can do to *help* T1 with her car issues short of sending her a check. I was just explaining HOW insurance companies reach the decision to declare a vehicle "totaled" when it might not seem very damaged. It is a simple financial calculation on their part that writing off the vehicle and selling it at auction is cheaper for them than having it repaired.

Even in states were there is a loss percentage fixed in law, those simply function as a cap. And insurance companies can and do total cars when estimated repairs are less than the statutory cap when they believe it is in their interest to do so. And often they are even more cautious than percentage formulas might seem to warrant because cars often have hidden damage that does not reveal itself until repairs have begun. They don't want to agree to repairs based on an initial $5,000 estimate and then have it turn into a $10,000 repair once the body shop starts digging and finds hidden damage.

One needs to read their auto insurance policy. I doubt any of them include a clause requiring that the insurance company pay for repairs when they don't think it is in their interest to do so. Out of curiosity I checked my own policy and it simply states that they may at their discretion either pay the cash value of the lost or damaged vehicle, or pay to have it repaired and that they may at their discretion keep all or part of the property being replaced. They also state that their limit of liability of loss shall not exceed the lessor of: (1) the actual cash value of the vehicle, or (2) the repair cost. So if they at their discretion decide it is cheaper for them to total the vehicle rather than repair it there is nothing I can do. The only thing I am entitled to do according to my insurance contract is hire my own independent appraiser if I disagree with theirs. And I think that is a provision in state law.

[temporal1]

^^Thanks, oj.
i mostly shared about it here, in the event someone else finds themself in a similar situation.

i was fairly surprised at my lack of experience - - - then, HAPPY this was the case!
i was pretty awkward and slow to respond, but that’s a good thing. i’m happy about that part of it.

most of all, no one was injured!

.. ^^prayers for the other driver ..

More twists. i’m ok, everything’s ok here.

However, i was told the other driver is now claiming she was not at the scene.
Her ins rep told me. i was astonished.

She insisted on police, she went into the store to get the parking lot video, she called my ins co the next morning.
She saw me take photos of both cars and her ins card.

There is something wrong here, she can’t be ok.

My ins rep told me this could be an attempt at ins fraud on her part. i’m worried about her.
This can’t be good. My ins told me it’s ok to talk with her ins rep, and send them the pics.

i didn’t ask, but i suppose she may not be able to get ins now.
i suppose she may have “a history.” i sensed there was more to her response than that little bump.
i hope there are no children in the mix. something is very wrong there.

“i wasn’t there.”

1) This only dragged on because i didn’t know what to do wrt insurance accident claims. i was very slow.
2) Eventually, i got a private repair estimate. The repair guy told me, from damage and pictures i showed him, i was not at fault, and this would not “ins-total” my car.
3) i decided to try the “photo claim” option with my insurance. Their repair estimate was $64 less than the private estimate.
They determined a vehicle value $500 lower than my Kelly Blue Book private party sale value. I found all this reasonable.
They have an offer from a salvage company to buy the car for $399. o.my.goodness.

4) Because their numbers were close+reasonable, i decided to keep the car, accept their offer, they will continue insurance with exception for coverage of the damaged parts (unless/until i repair) .. they have begun attempt to recover damages from the other ins company. i was told, if they recover, the first $500 will go to me (my deductible).

My ins co found me “not liable,” i was surprised. i was expecting “no fault,” either party.

The car is worth more than KBB value to me, with relatively low miles, and, i take care of it, i.e., it has lots of new parts.
The salvage guys would have made some quick money, i’m pretty sure.

i could pay 2-3 times or more, have a newer car with less mileage, yet not be as well off.
i’ll stick with Old Reliable. i’m planning to have part of the damage fixed, probably in spring.

i’m at peace with all that.

i’m bothered that the other driver is going to have a hard time, and needlessly so.
i may never know. it’s not my business. i pray for her to be ok.

A glance at the gravity that could be involved for her:

Freidberg Attorney at Law
https://www.chicagocriminallawyer.pro/p ... nce-fraud/

.. Insurance Fraud in Illinois (720 ILCS 5/17-10.5)
The crime of insurance fraud is set out in 720 ILCS 5/17-10.5. Under the statute, a person commits insurance fraud when he or she:

Knowingly obtains; or
Attempts to obtain; or
Causes to be obtained;
By deception;
Control over the property of an insurance company;
By making a false claim;
Intending to deprive the insurance company permanently of its property.

Examining the elements, it is important to note that you can be charged with this offense even if you did not obtain insurance benefits.
It is sufficient for conviction that you attempted to obtain benefits by filing a false claim.
Deception of an insurance company or a self-insured entity will both result in a conviction.

Further included in the crime of insurance fraud is health care benefits fraud. This crime involves knowingly obtaining or attempting to obtain health care benefits by deception from a health care insurance provider, other than a governmental agency.

The crime of aggravated insurance fraud will be charged when an individual commits insurance fraud three or more times within an 18-month period arising out of separate instances or transactions. This heightened offense can also give rise to conspiracy charges if the circumstances indicate organization of fraud.

Punishment for Insurance Fraud in Illinois
Insurance fraud is punished by the value of the property obtained or attempted to be obtained from the insurance company.
If you defraud or attempt to defraud the insurance company of $300 or less, it is a class A misdemeanor, punishable by up to one year in jail and a fine of $2,500. Fraud between $300 and $10,000 is a Class 3 felony, punishable by a minimum of two years in prison and up to five years, along with a fine of up to $25,000. If the insurance fraud exceeds $100,000, it is a Class 1 felony. Class 1 felonies are serious offenses, punished by a minimum of four years in prison and a maximum of 15, along with fines of up to $25,000.

Health care fraud is punished as a Class A misdemeanor, while aggravated insurance fraud is always a Class 1 felony, regardless of the value of the property obtained or attempted to be obtained.

With any misdemeanor or felony conviction, it is important that defendants understand the conviction will become a part of their criminal record.

This record is visible to employers, schools, military institutions, and others.
A felony conviction can greatly impact your employment future. ..

She could have driven away, i would have agreed to let her do that. Her car had a small paint scratch, probably not 2” long.
Near her rear license plate. Not conspicuous. Her car was later model, it still had temp plates. I don’t know the year.

i hope she gets help she needs. i doubt this was her only problem in life. It hurts my head.