Losses and recoveries when your car has been damaged
The Measure of Your Loss
One of the most frustrating parts of being in a car crash is getting your car repaired or finding another car to replace the one that has been deemed a total loss. Ohio law says that when your car has been damaged, you are entitled to the difference between the fair market value of your car immediately before the crash and its fair market value immediately after the crash. If the car is repairable, this is usually the cost of the repairs. Your car is deemed to be a total loss if the cost of repairs exceeds the car's fair market value or if the cost of repairs is 80 to 90 percent of the car's value. If the car is found to be a total loss, then this is the value of the car right before the collision and its salvage value (what a junk yard will pay for your vehicle after the crash). If you purchase a replacement car within thirty days, Ohio law holds that the insurance company has to pay you sales tax on the fair market value of the your that was totaled.
If your car is a total loss, you may be disappointed at the amount that the wrongdoer's insurance company is claiming that your car was worth. In this situation, you need to know what the used car value of your car is. You can go to the internet site for NADA and this will give you a very solid start as to the value of your car just before the accident. If you recently purchased new tires or a special component for your car, show the insurance adjuster the receipt for this improvement to your car. This may lead to a higher valuation of your vehicle.
What do you do if you are totally dissatisfied with the offer from the wrongdoer' insurance company? If you have exhausted negotiating with the insurance company, you should contact your own auto insurance company. If you have collision coverage, you may be better off having your own company cover the loss and you pay the deductible. Your insurance company will later file the paperwork to get the wrongdoer's insurance company to repay them for what your insurance company spent to fix your car. Usually, your insurance company will recover your deductible for you at this time, too. However, this exchange may not occur for many months after the collision.
Does the wrongdoer's insurance company have to pay for a rental vehicle? If the car is repairable, Ohio law says yes. While the car is being repaired, the wrongdoer's insurance company has to pay for a rental car comparable to the one that is being repaired. If the car is a total loss, then Ohio law says that the insurance company is not obligated to pay for a rental vehicle. Ohio law unrealistically expects you to be able to get a replacement car immediately, and, therefore, you are not entitled to a rental car. As a matter of practice, some insurance companies will provide a rental car for a week or so to allow you some time to find and get a replacement car. If the insurance company does not provide a rental, look to your own auto insurance company. If you have rental reimbursement insurance, then your own insurance company will provide this to you.