Posted by Dave C. on January 15, 2010, 10:52 pm
On Sat, 16 Jan 2010 06:08:07 -0800
> If an older car (say 10 years old) is in an accident and totaled, how
> much does the insurance company pay you?
>
> How do they determine value?
>
> Say they just want to pay $1000.00 and it would cost me $5000.00 to
> get another car in similar running condition (I do a LOT of work on
> my car including rebuilding the engine when needed, etc. I keep it in
> tip top reliable running condition.)
>
> I'm trying to figure out if I should just have liability insurance or
> if it would be worth it for full coverage.
In general...you shouldn't buy full coverage insurance for a car older
than 5 years old, unless it is more valuable than average for some odd
reason. For example, you've done a rotisserie restoration on a single
owner 1970 Chevelle SS and now it's worth say, $100,000. Blue book
value would be zip. But you can have the car appraised and insure it
for the appraisal value. -Dave
Posted by BigDog1 on January 16, 2010, 10:10 am
> If an older car (say 10 years old) is in an accident and totaled, how much
> does the insurance company pay you?
> How do they determine value?
> Say they just want to pay $1000.00 and it would cost me $5000.00 to get
> another car in similar running condition (I do a LOT of work on my car
> including rebuilding the engine when needed, etc. I keep it in tip top
> reliable running condition.)
> I'm trying to figure out if I should just have liability insurance or if it
> would be worth it for full coverage.
Determining if you need collision/comprehensive insurance on your car
is easy. If you can't replace what you're driving now without going
into debt, then you need the insurance. How much deductible is also
easy. Depends on how much you afford to pay without disrupting your
budget.
As to what they'll pay you in the event you get "totaled", that's also
easy. Age, mileage and condition. Either Edmunds or Kelly Blue Book
will get you in the ball park. What you think it would cost to
replace the car is irrelevant. All that matters is what the car is
worth on the open market in your area. The insurance company will try
to low ball you, but there's no way they'd try to get away with one
fifth.
Everyone thinks their car is worth top dollar, but it rarely is.
Truth is, reliable junk is still junk.
Posted by Rod Speed on January 16, 2010, 12:50 pm
BigDog1 wrote
>> If an older car (say 10 years old) is in an accident and
>> totaled, how much does the insurance company pay you?
>> How do they determine value?
>> Say they just want to pay $1000.00 and it would cost me $5000.00
>> to get another car in similar running condition (I do a LOT of work
>> on my car including rebuilding the engine when needed, etc. I keep
>> it in tip top reliable running condition.)
>> I'm trying to figure out if I should just have liability
>> insurance or if it would be worth it for full coverage.
> Determining if you need collision/comprehensive insurance on your car
> is easy. If you can't replace what you're driving now without going
> into debt, then you need the insurance.
That is just plain wrong. If you dont need much
debt, that can be cheaper than the insurance.
> How much deductible is also easy. Depends on how
> much you afford to pay without disrupting your budget.
Your budget is irrelevant with an unusual event like that.
> As to what they'll pay you in the event you get "totaled", that's also easy.
Wrong again.
> Age, mileage and condition. Either Edmunds or Kelly Blue Book
> will get you in the ball park. What you think it would cost to replace
> the car is irrelevant. All that matters is what the car is worth on the
> open market in your area. The insurance company will try to low
> ball you, but there's no way they'd try to get away with one fifth.
> Everyone thinks their car is worth top dollar, but it rarely is.
> Truth is, reliable junk is still junk.
You dont know that it is junk.
Posted by krw on January 16, 2010, 12:17 pm
wrote:
>> Bill wrote:
>> >If an older car (say 10 years old) is in an accident and totaled, how much
>> >does the insurance company pay you?
>>
>> >How do they determine value?
Usually from the NADA guide, which compiles the sales by member
dealerships, by model and year. www.nada.com
Other alternatives:
www.kbb.com
www.edmunds.com
>> Typically you'd get the value of the vehicle (mileage adjusted)-
>> determined by any number of sources, but an Edmonds on-line estimate
>> somewhere between the trade-in value and private party sale price is
>> probably a good estimate. Not knowing your vehicle, I'll suggest
>> between $1-2k for a typical 10 year old car.
>>
>> >Say they just want to pay $1000.00 and it would cost me $5000.00 to get
>> >another car in similar running condition (I do a LOT of work on my car
>> >including rebuilding the engine when needed, etc. I keep it in tip top
>> >reliable running condition.)
>>
>> >I'm trying to figure out if I should just have liability insurance or if it
>> >would be worth it for full coverage.
>>
>> Collision coverage is typically questionable for a car >5 years and
>> probably an expensive luxury >7 years, but much depends on the year,
>> model, mileage, your cash flow, etc.
>Personally, I would not insure a vehicle worth less than about $7,000
>or so, maybe $10,000 for round numbers.
That is a personal decision. Answer the question: "what can I afford
to lose?". Insurance is a loser so you are (generally) better off
self-insuring. Of course that assumes there is no loan on the
vehicle. Most lenders will insist on full coverage.
>In my state that still leave
>people like me vulnerable because of something called "no fault."
>Basically, that means everybody takes care of their own damage except
>for a potential $400 small claims lawsuit. Still, safe drivers can
>make out by self insuring small assets.
Which state? Most have totally botched "no fault".
Posted by Rod Speed on January 16, 2010, 12:46 pm
Bill wrote:
> If an older car (say 10 years old) is in an accident and totaled, how much
does the insurance company pay you?
Varys with the company. Some will pay the agreed value, others
will pay the value they determine and you get to like that or lump it.
> How do they determine value?
Again, that varys.
> Say they just want to pay $1000.00 and it would cost me $5000.00 to get
another car in similar running condition (I do
> a LOT of work on my car including rebuilding the engine when needed, etc. I
keep it in tip top reliable running
> condition.)
> I'm trying to figure out if I should just have liability insurance or
> if it would be worth it for full coverage.
Even the operations that do pay an agreed value wont necessarily
agree to a value thats well away from the market value like that.
Essentially because there is a real potential for fraud in that case,
deliberately writing the car off to get that much higher value.
You can however get that sort of much higher value in some situations like
exotic unusual cars etc. And you wont like the premium they want to change.
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> much does the insurance company pay you?
>
> How do they determine value?
>
> Say they just want to pay $1000.00 and it would cost me $5000.00 to
> get another car in similar running condition (I do a LOT of work on
> my car including rebuilding the engine when needed, etc. I keep it in
> tip top reliable running condition.)
>
> I'm trying to figure out if I should just have liability insurance or
> if it would be worth it for full coverage.