Your trip across the state to visit your sister was supposed to be a fun time, but on the way there you were hit by an oncoming car and sustained damages to your front end. Thankfully, you weren’t hurt, but now you need to get your car repaired. You hope the insurance estimate will be fair and cover the cost of your repairs.
Insurance companies have a process by which they determine what the cost of your repair should be, and that process has some subtleties that you may need to know in order to understand the methodology.
How Estimates Are Determined
There are many factors that determine the repair estimate. The following factors can cause an estimate to be more or less than the repair cost turns out to be:
- The type of replacement part used may be new or refurbished, which will change the price.
- The time needed for the repair may be estimated as less or more than the actual time needed.
- The insurance company’s allowable labor rate may be higher or lower than the repair shop’s actual rate.
- The damage may be more extensive than shown on the estimate.
Because of these factors, it’s possible that the estimate may not cover the entire cost of the repair after the deductible is met. You may be able to ask the estimator to explain how the estimate was calculated or to ask for an adjustment on the estimate if you disagree.
Once repair costs are estimated, the vehicle owner is responsible for ensuring that the repairs are made.
Saving Money on Your Repair
Keep in mind that if your car is financed, the bank may want assurances that the car is fixed in order to maintain its value. If the bank repossesses the car and they can’t recoup their value upon resale, you may be liable for the difference at that time. Reporting vehicle damage to the bank is required when the car isn’t paid off.
If the car is considered “totaled,” that is, if the repairs cost more than the car was worth at the time of the accident, you will receive a check for the value of the car. You will then need to pay off your loan if you have one, and whatever is left is yours. You may need to put it toward a new car, but are not required to do so.
Get an auto insurance quote from AIS Insurance that will give you the best rate for your collision and comprehensive insurance.
The information in this article was obtained from various sources. This content is offered for educational purposes only and does not represent contractual agreements, nor is it intended to replace manuals or instructions provided by the manufacturer or the advice of a qualified professional. The definitions, terms and coverage in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.
