View Full Version : Dealing With Insurance Companies?
Peter
05-07-2004, 06:41 PM
After being hit by a car at the end of March, I am currently in the process of settling my claim with the insurance company, and need advice.
The insurance company split my claim to two adjusters; one for bodily injury/pain+suffering, and another for property damage to the bicycle, etc.
The bodily injury adjuster and I have come to a settlement, which was so small in the insurance company's eyes that it does not require a release of liability to be signed-that's how the adjuster worded it. I presume the claim remains open until I cash the check.
After submitting a detailed estimate of "repair" costs for the bicycle, helmet, etc. to the property damage adjuster, I received a call today requesting receipts showing the original purchase price of the damaged items. The bike is about 6 years old. I am trying to pursue repair rather than replacement because I suspect if the bike is judged to be totaled, the insurance company will try to depreciate its value, and my logic is you can't depreciate repair costs. If the bike is depreciated, there is no way I'll receive enough to cover repairs.
Their request tells me they are going to try to depreciate the bike or "total" it.
Any suggestions on how I can ensure I receive adequate reparations to repair the bike?
I'm considering returning the bodily injury check pending settlement of the property damage claim.
BumbleBeeDave
05-07-2004, 09:21 PM
How much did it cost originally? Are there depreciation charts available for bicycles? Your policy may specifically assign the right to the insurance company to decide between repair and write-off . . . and they obviously are going to want to do what will cost them the least cash.
BBDave
Peter
05-08-2004, 06:40 AM
BumbleBeeDave-
The bike's original cost was $2700. Depreciation costs do NOT exist for bicycles, especially custom bikes like many of us are familiar with.
You are dealing with the motorists insurance company, correct? I hope you are. If so, I would recommend the following.
Insurance companies are often surprised how expensive our bikes are. What you need to do is get an appraisal for repair and/or replacement from your favorite lbs and submit that appraisal to the insurance company. Everyone I know has done this and received monies from insurance companies for the appraised amount. Claims for bikes have been based on replacement value. Depreciation has never been considered.
You need to be really sure that you are going to be satisfied with repairs? Will your bike be repaired to the condition it was before the accident? Consult with your lbs on this matter. They might have some experience dealing with insurance claims as well.
I would recommend that you play hardball with the motorists insurance company. If nothing was signed for the bodily portion, I would return the unsigned check stating that nothing is settled until everything is agreed to.
I'm surprised they didn't have you sign a release waiver before handing you the check for bodily injury. Boy, lawyers could have fun with that one.
Insurance companies want to settle quickly for as little as possible. They also don't want lawyers involved....
BumbleBeeDave
05-08-2004, 11:27 AM
. . . they want to get out as cheaply as possible and they don’t want lawyers involved. But my career as a jaded journalist has also taught me that they are certainly not above doing whatever they please to get away cheaper if they feel they can roll over you. I assure you they have depreciation rates for EVERYTHING . . . they have whole departments that do nothing but concoct that kind of stuff. I guarantee they are going to try to tell you--indirectly maybe--how much your bike is now “worth” and it won’t be what you want it to be.
Don’t cash ANYTHING. Don’t sign ANYTHING until you are sarisfied you have gotten the fairest deal you can.
BBDave
Peter
05-08-2004, 04:06 PM
Yeah; I'm dealing with the motorist's insurance company. The LBS wrote up an ESTIMATE. The first adjuster that called thought it was a RECEIPT and assumed I had already repaired the bike (RULE-DON'T EVEN TOUCH THE BIKE UNTIL THE CHECK IS IN YOUR HANDS). I don't know why she thought this because she ASKED ME FOR AN ESTIMATE!
Perhaps it would have been in my interest to have the LBS provide an estimate that merely said, "Cost to repair damage to bicycle from accident-$X." Instead, the LBS listed the cost of EACH PART.
I want to push for REPAIR, with the reasoning that repair costs can't be depreciated. This will leave no wiggle room for the insurance company.
Needs Help
05-08-2004, 06:58 PM
If you are contemplating settling for less than $50k for your pain and suffering, get a lawyer. Think of it this way: if you don't financially punish motorists that hit cyclists, then nothing much will happen to them.
stackie
05-08-2004, 08:39 PM
Peter, I have dealt with an insurance company after being hit. I found the property claim guy to be pretty reasonable. I had a LBS do a worksheet detailing the replacement price of every part that was scratched. I also had him work in dismantling the frame, taking it to a qualified framebuilder for complete evaluation and a repaint with Joe Bell. Their repair bill was $150 less than the bike cost. I gave him all of my damaged clothing, scraped shoes, dented helmet etc. I did depreciate these items myself, which he accepted.
The injury claims rep was an idiot. He offered to send me a gift certificate for a local restaurant. I told him that I was going to hang up and I expected a call from a different rep in less than 48 hours. The next rep called, talked to me for an hour and doubled my suggested compensation. If you're not seriously injured, I would think they would be happy to pay you a paltry few thousand dollars to prevent you from claiming the herniated disk that you might suffer next year as a result of your accident. You might even use some of this money to cover your bike costs if you are unsuccessful in getting the property claims adjuster to see the light.
You, of course, have some idea of how many dollars it will take to make things right for you. You may have to tweak the injury adjuster for some extra if the property adjuster won't go the full distance for you. And, of course, don't be hesitant to waffle a little bit at any unsatisfactory offer and think out loud that "Maybe, I should talk to a lawyer." Remember, lawyers are our friends, and take every breath thinking how they can make the world a better place, so any of our do gooder personal injury lawyers would be happy to take on an insurance company for a paltry 40% contingency fee. After you play the lawyer card, the insurance adjusters will likely fold if their hand is not strong. I'm guessing that you
Finally, let me give you a different paradigm for dealing with the insurance company. First, do you have homeowner's insurance? If so, your bike is likely covered under this policy. If you do not have depreciation on your homeowner's policy, consider making the claim for your bicycle replacement on your own homeowner's policy. Let them subrogate to the motorist's insurance for reimbursement.
Anyway, just some ideas.
Jon
Needs Help
05-08-2004, 10:02 PM
First, do you have homeowner's insurance? If so, your bike is likely covered under this policy. If you do not have depreciation on your homeowner's policy, consider making the claim for your bicycle replacement on your own homeowner's policy.
One or two claims like that on your homeowners insurance, and the next time your homeowners insurance comes up for renewal, your insurance company may cancel your policy. I'm not sure how we got a system like that--it should be illegal--but I've read too many stories of that happening.
stackie
05-08-2004, 11:59 PM
I'm not an insurance agent or company rep, but one would think that this would not be a claim that would cause your homeowner's insurance to cancel. After all, the costs would be entirely subrogated to the motorist insurance company. Your auto insurance does not go up when you make a claim on an accident which was not your fault.
But, it is a good point to at least consider, should one go this route.
Jon
Needs Help
05-09-2004, 01:17 AM
After all, the costs would be entirely subrogated to the motorist insurance company.
Yes, I see your point.
Peter
05-09-2004, 06:12 PM
...especially Needs Help and Stackie; you offered quite a bit of useful advice that I will use with my claim.
The odd part about the suggestion to subrogate- both mine and the other party's insurance company are the same! Since I DO have an actual cash value replacement clause in my renter's insurance, I'm now considering advising the claims rep to not waste any time and offer me actual cash value replacement minus my deductable because otherwise if I file a claim against MY insurance, they'll only subrogate against themselves!
Thanks again for ALL replies; I'll post again with the end results.
Birddog
05-09-2004, 08:16 PM
It's been awhile since I've been in the Casualty business, but things haven't changed that much. You need to check and verify which coverage you have. Is it "Replacement Cost Coverage" or is it ACV or "Actual Cash Value"? ACV means that they WILL depreciate, how they do it is unknown. Replacement cost means that they will pay to replace the item at todays prices, no depreciation. If you have "Replacement Cost Coverage", then your idea is a good one. If it is ACV, then you might give this idea a little more thought. Don't let them work a deductible into it, if another party is liable, your deductible should not be considered in the process.
Good Luck,
Birddog
If at all possible, I would recommend that you avoid getting your insurance company involved. Even if the claim is subrogated to the guilty parties insurance firm.
In this day and age of greater reliance on databases, people still enter pertinent data to said database. Errors do happen in data entry and it's possible that enough details about the incident is left out that leaves the impression that the incident was your fault. Come review time, this could have a negative effect on your rates, especially with Home Insurance policies as Needs Help stated. This would not happen if the incident was kept on the guilty parties side of the fence.
My $2.00.
If you were injured by a negligent motorist, you have a right to be made whole by that motorist or his or her insurer. If you can truly be made whole (just as good as before) by repairing your bike, then that's fine. Just make sure that the repair will really be up to the task before you settle. Any significant doubts (about structure, function, or finish) should be on them, not you.
What about "totaling" the bike and/or replacing it. Although there's a general or principled sense in which depreciation might be in order, there are barriers to effective depreciation with regard to road bikes. For one thing, with all due (and slight) apologies to the blue book, there are not standard and generally accepted depreciation tables for bikes. Second--and not unrelated--there just is not the same sort of developed used market for bikes that there is for cars. Sure there are lots of used bikes for sale. But your ability to locate your particular bike in your size and verify its mileage and condition are simply vastly poorer than your ability to locate and replace your car. So as a practical matter, people who stick to their guns (and some folks right off the bat) very often end up getting the replacement price of NEW gear. Basically, a new one is the only thing that can satisfactorily replace the old one.
And no, you shouldn't need receipts. The property itself, with detailed estimates from a shop, should be adequate to document the repair or replacement value of your property. Stick to your guns. Don't sign off on ANYTHING until you are satisfied. And if you feel you need to talk to a lawyer, do so.
Good luck.
Needs Help
05-10-2004, 09:16 PM
The odd part about the suggestion to subrogate- both mine and the other party's insurance company are the same!
I would interpret that as bad news. Consider that your insurance company might try to get some retribution if you play hardball. In other words, they may raise your rates when renewing your insurance. I think you would have been in a much better position if the other person's insurance company didn't happen to be the same as yours.
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