Expert: Richard L Carranza - 5/10/2005

Question
I live in California and was rear-ended about a month ago. I just now recieved a letter with a settlement amount that does not look right to me. I did some research and found my car to be worth more than what the insurance is offering. The agent from the insurace mentioned that they offer the amount that the car is worth under private party vaule. Shouldn't I be receiving the retail vaule price and not the private party vaule price?

Thank you,


Answer
Although you do not say so I assume your car is a Total Loss.

Vast majority of insurance companies use data bases to develope an Actual Cash Value (ACV) for the involved vehicle.  In the old days we would use books like the Red Book, N.A.D.A. book, etc... thus the term "book value".  Data bases such as N.A.D.A. and CCC are used today as they are quicker and more accurate in general as they extract valuation information from numerous sources.

I assume the company that made you the offer is the at-fault party's carrier.... ask them to provide you with their appraisal documentation as well as their ACV work-up.

I never heard the term "private party value"....but then CA has always been an odd State.  Your car's valuation is based on the ACV for your make, model, equipemnt, mileage and condition.

Calculating an ACV is not an exact science regardless of what anyone tells you.... do your homework (check the sources as well as dealers).  With your supporting homework in hand you should be able to negotiate to a higher number.

Have your agent assist you... he gets paid a commission on your premium to provide that service.  CA has an aggressive Insurance Dept with a solid Consumer Unit... use them if the carrier jerks you around...

Hope and trust that the above answers your questions and provide some direction,  

Feel free to get back to me with any additional questions/issues relative to this matter.

Please take the time to rate this response in the various catagories.


Thanks