Sometimes your vehicle damage claim can be the most frustrating aspect of an accident. You may not be able to get to work or to the doctor because your car is not driveable and the at-fault driver’s insurance company is not being helpful. It is important that you understand how insurance companies process these claims so you know what to expect.
The insurance company is not going to take responsibility for your claim until they have completed their investigation into the accident. This means they may want to review the accident report, inspect your car, take a statement from their insured, and interview the police officer and any witnesses. They may also want to take your recorded statement.
If a decision is made to accept the claim, the at-fault driver’s insurance company will then pay to have your car repaired or, if the car is totaled, pay you its fair market value. By North Carolina law, if the repair bill is greater than 75% of the fair market value, then the at-fault driver’s insurance company will total the car. If the insurance company decides to total your car, they will probably pay off any outstanding loans on the car and then pay you the balance, if any. If the car’s fair market value is less than you owe, you are still responsible for paying the loan. The insurer will take possession of the car after you sign over the title. If the bank has the title, the insurance company will have you sign a power of attorney to give it the authority to transfer the title.
If your car is repairable, then the at-fault insurance company will give you a cost estimate prepared by their appraiser. You then have the freedom to choose the body shop you want to fix your car. You are not required to take it to the insurance company’s approved repair shops, although there may be certain advantages to doing so.
Furthermore, if they accept responsibility, the at-fault driver’s insurance company will usually pay for a rental car. You will normally have to have a credit card to get the car. Generally, they pay between $20 and $26 a day for the rental. In certain circumstances, they will pay for more. If your car is not driveable but is repairable, you will be provided a rental car for a reasonable period of time while your car is repaired. If your car is driveable, you will be provided a rental car when your car goes in the shop and until it is repaired. If your car is totaled, you will be provided a rental car for a reasonable period of time, usually not more than a few days.
Other questions we can answer for you:
- Can the at-fault driver’s insurance company insist on used parts to repair your car?
- What is substitution of collateral and how it can help you get into a new car faster through your current car loan if you don’t have enough equity in your car?
- What should you do if the insurance company’s investigation is taking too long or they deny the claim?
- If the at-fault insurance company is delaying the claim, can your own insurance company assist you?
- How does diminished value work and when are you entitled to it?
- What is the 25% rule in regards to disclosure to any potential buyers of the wrecked status of your repaired car?