If your insurance settlement offer is considerable low for a large dollar amount claim (based on your estimates) or you have a significant claim on a custom or collector vehicle, then you should seek the advice of a licensed insurance appraiser for the true fair market value of your vehicle. The collector car market or high-end auto is something you cannot do yourself, failure to obtain expert advice can cost you money. Do not believe because you watch Barrett-Jackson auction, read trade magazines or perform minor repairs you can negotiate with the insurance company effectively.
Those who have auto’s, excluding the above categories, can use the internet as a research tool along with local used car dealer advertisements to ascertain a reasonable fair market value for your vehicle. It is not just gathering numbers from Kelly Blue Book (KBB) or Auto Trader but how you put the numbers together to present your case.
You will ascertain fair market value of your vehicle by using internet sources and local used car lot pricing. Then you will make all the necessary adjustments to reach a fair market value for your auto. If you had any major repairs done to your auto, collect all your receipts.
Scheduled maintenance is not considered extra costs, they are expenses. However if you purchased aftermarket rims and tires that cost $2,000 it may help but you need the receipt. You probably would have put the original tires and rims back on the vehicle before offering it for sale or returning to the leasing company. Then sold the aftermarket tires and rims independently on eBay or Craig’s List for additional money.
Gather all your receipts for any additional work performed on your auto. If you had major work like a replaced transmission, then your auto should have more value then an equally equipped model that has the original transmission. Even if your insurance company doesn’t recognize your additional cost’s a used car dealer or small claims court Judge would include it in the resale price.
Find out from a used car dealer the selling price of your vehicle if it had a new transmission versus the original transmission. The difference in selling price will be insurance negotiating power. You need to gather as much negotiating power as you can.
You will use the worksheet to populate all your research. Besides helping you ascertain fair market value you have a list for reference during negotiations. The worksheet will help you organize your thoughts and make sure you are not forgetting anything.
The more value documented increases your chance of obtaining a higher insurance settlement amount. Only documented information has value, saying something without having it documented means nothing. Documenting your research increases your negotiation strength, because your represented with facts.
You will receive a settlement document from the insurance company. You want to compare your results to the insurance company offer. The difference in the settlement offer is the basis of your negotiations. The detailed analysis of your auto fair market value enables you to compete in the negotiation process. Remember your insurance claim representative has all the resources needed to win.
Your advantage is you personally did the work. Your belief in the numbers is based on your research, whereas the insurance claim representative relies on a prepared document from a staff member. You will speak with conviction. The insurance claim representative will speak from a script.
It is necessary to list several reputable on-line auto sites on what they believe your vehicle is worth. Each site has it’s strength and weaknesses. You will not be able to know any information of the cars they used. However they all ask for your zip code which suggests they use vehicles in your local market. Every site has a category condition of the vehicle.
The condition categories are excellent, very good, good, and fair. You need to judge for yourself what condition your vehicle falls under. The price range for each category is substantial different, so you need to read the condition category of each site to help you decide on your answer. Populate the information on our vehicle Fair Market Value Worksheet.
Kelly Blue Book The results have two choices, trade value and private party value. The private party value is 80% higher than the trade value. Look at both values and remind yourself of the difference when you research local used car lots.
NADA Guide is the industry standard in pocket book form in the vehicle re-seller market. While on-line is okay, the book gives much greater detail. When at an auto auction site most people check the NADA book to compare against bidding price or to know how far to bid.
AutoTrader is another good on-line resource. Auto Trader also publishes used vehicle listing local in your region. You see how many potential vehicles are in your category. You also see the condition of the vehicle with a picture. It’s not the same as physically viewing the auto but it’s better than nothing.
Cars.com is another on-line resource fairly new in relation to the others but has a presence.
NewCars.com is a division of cars.com where they help you determine fair market value.
Any other on-line service you know of should be checked out. The more information you have the more accurate your acceptable settlement value will be. The research you do builds conviction in your numbers which helps in your negotiation competition.
The physical research is where you locate at least ten vehicles that are exactly the same as your accident vehicle. You are going to derive a new average price but instead of it being just a bottom line number you will have the details. The vehicles that make up the average. In this part of the research you do not mind if the used car salesperson jacks up the price, that works in your favor.
Looking at the local used car flyers left in pizza places and grocery stores is a good start. You can use auto trader to find an exact match of your vehicle. It will list the mileage, and location of the auto. You want to use the auto in your zip code area.
If you cannot find anything in your zip code increase the distance from your zip code. Eventually you will have a list of 10 auto’s that are all documented whereas nothing is made up.
You are then going to take the average price of your listed vehicles and compare those results to your online results. You now have four reputable on line auto valuations. You also have a fair market valuation with details. You have all the information needed to compare with the insurance company settlement document to your findings and also know what your disagreement amount is going to be.
The Fair Market Value Worksheet is your documentation for your negotiations. When discussing your auto’s fair market value you have detail numbers that can be compared to what the insurance company used, in their settlement document.
The following is a summarized list of items to assist in ascertaining fair market value for your auto.