Car Insurance help?

Car Accident - Any tips on Insurance would help?

• My husband was waiting in a line of traffic while another car turned off the road and was rear ended by a pick-up going about 50mph, he was hit from the rear and then my husband hit the car in front and so on. Here's the problem... We are in our 60s and have a very tight budget. That car - a 2003 Honda SUV was suppose to last us another 10 years. It only had 40,000 miles on it and was in perfect condition. Not a scratch (I always park away from the crowd). So, the insurance co. has said they would give us $15,000 for the tottaled car, but the new SUVs cost over $20,000. Never having an accident before, we thought that our insurance would pay the value of the car and the car at faults insurance company would pay the difference for a new car. Found out that is not the way it works. So, we have been paying the insurance company for car insurance for about 40 years without any claims and now when we need them we find that they will not replace the car. Is this right?

• Answer:

  Yes. Insurance only has to pay for the cost to repair the car, or the actual cash value (whichever is lower). If the car was a 2003 and was totalled (meaning the ACV is lower than the repairs), then that is all they have to pay. You should see how much it would cost to fix, it may be only slightly higher than the amount they paid you (unless the car is really totalled beyond fixing). Otherwise, unfortunately, this is the way that it is. They are paying you for what is a close estimate to what it would cost to replace a 2003 Honda SUV. You could try to pursue his insurance company for the extra money (some people will tell you to hire a lawyer and do this), but it won't work. The laws are straightforward on the totalling of a vehicle and the right of the insurance company to do this. Sorry, I can't give you a secret way around it, but what they are doing is the way that the laws are.