Expert: Charlie Barone - 9/23/2009

Question
(Wisconsin) I have made a claim with my insurance company, which considered my vehicle a total loss after I was hit by someone who failed to yield.  The claim included an amount for sales tax until I chose to retain the vehicle. The insurance company is now withholding the deductible, cost of buy-back and all the sales tax they originally said they were going to pay. Is this common practice?

Answer
Ordinarily in a total loss an insurance company owes you the actual cash value for your car (the cost to replace it with one of like kind and quality, plus sales tax and license transfer fees). However, if you are not going to replace the car, I would imagine that they are justified in withholding the sales tax and transfer fee. As always, the amount you receive is subject to your deductible, if it is your policy under which the claim is filed.

You may try filing a claim with the liability carrier of the other party, so you won't have the deductible to deal with.