Expert: Richard Hixenbaugh - 5/11/2009

Question
QUESTION: When ACV determinations are made for personal auto claims, is there a
definition set by law such as "local market is defined as X miles radius from your
zip code"? If yes, what is it, if not what is a commonly used definition? What is a
typical distance?
Thanks in advance.

ANSWER: Hi Jon,

Each state has its own definition of "local market". In some states it is within 50 miles of the vehicle owners zip code while in others there is no distance requirement.

As a rule of thumb you should limit the distance to 100 miles. This will generally be an acceptable range in most locations.

I hope this helps
Richard Hixenbaugh

---------- FOLLOW-UP ----------

QUESTION: Thanks Richard, do you happen to know what this limit is in Florida?

Also, is there a legal requirement for the comparable vehicles to be available
for sale at the time of ACV report preparation or could the insurance
companies use information from past sales (if so how old is acceptable)?

And lastly, can the insurance companies present the same model but a
different year as a comparable car?

Thanks again.

Answer
Hi Jon,

I do noy know what the standard is in Florida. You can contact your state insurance commissioners office to find out. Comparable vehicles can be based on currently listed for sale vehicles or can be based on recent sales as far back as 60 days. Any differences between the comparable vehicles and yours must be equalized. This means that they must make adjustments for differences in year, options, mileage, etc.

I hope this helps
Richard Hixenbaugh