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Car Crash Property Damage: Getting Fair Value When Totaled

March 30, 2023

Reprinted with permission from the March 30, 2023 edition of The Legal Intelligencer © 2023 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.

“I have never been through this before, and I’m just not sure how to handle it.” If what needs to be “handled” is a vehicle property damage insurance claim with no personal injury, you can confidently guide an insurance consumer in the right direction; it can be a DIY project. If you are dubious about the last sentence, read on and keep this article within easy reach for when someone walks into your life carrying the weight of a totaled vehicle claim.

An educated insurance consumer can get to a fair value for a car that is a total loss, if they keep these guidelines in mind:

  • Understand the process;
  • Do the research; and
  • Remind the appraiser and the insurer of their responsibilities.

The process:

There are two remedies for most situations in which a vehicle is damaged:

  • An insurer will pay to fix the vehicle, bringing it back to its pre-accident condition, or,
  • An insurer will pay the owner the actual cash value for the vehicle, “totaling” the car.

For this discussion, we will assume proper remedy is to total the car, and the car is not a specialized vehicle or classic and is not on a replacement cost-type policy.

In laymen’s terms, getting to the actual cash value means paying the consumer enough to buy a similar car. Similar means the same kind and quality, which usually translates to the same make (GMC), same model (Acadia), of the same year, mileage, condition, and with the same features as the one totaled. It is impossible to find a car with identical attributes, so similar also means one which is comparable.

There are two types of people involved from the insurance company side who affect the value of the claim. There is an appraiser who values the vehicle and a property damage insurance adjuster who negotiates the value of the claim for the insurance company.

Let’s get specific on the process to get to the value. The car is at a body shop. The body shop gives an appraiser for the insurance company an estimate to fix the car. The appraiser recognizes that the estimate is over the threshold for what totals the car. The adjuster tells the insured the vehicle is totaled, and that the insurance company will offer to buy the vehicle for what the car’s actual cash value was before the wreck—settling the claim. The appraiser inspects the car and determines the actual cash value. The appraiser gives the valuation to the adjuster who then makes an offer to the insured based on the appraiser’s work. The owner of the car assesses the fairness of the offer and, if satisfied, accepts the offer. The consumer sends the signed title for the car to the adjuster who in turn sends a check for the agreed upon amount. The amount may be reduced by a deductible if the consumer is working with their own insurance company. The check will be for the full amount if working with the adjuster from the insurance company of another person who caused the damage. The transaction is a contract, and it is binding on both the consumer and the insurance company. The insurance company then salvages the car, recouping some of the value of the claim paid. The insurance consumer uses the money they received as they see fit, usually to buy another car.

(Warning: if there were injuries in the crash, the consumer should only sign documents transferring ownership of the totaled car and should not sign any documents giving up the rights to pursue an injury claim. Read what the insurance company sends. Get a lawyer involved.)

The general process described needs further explanation for how a consumer assesses the fairness of an offer through research as well as how the consumer can negotiate to a fair value by reminding the appraiser and adjuster of their respective duties.

The research:

“People do what you inspect, not what you expect.” These are words from one of my college professors, and they apply here. The consumer must find cars for sale that are comparable to the one destroyed. Search the internet for three vehicles currently for sale and of the same make and model. Find cars from the same year and with close to the same mileage. The consumer may go a year newer to get similar mileage, and they may use a car with a few less miles but of the same year. Next, narrow the list to the cars with similar amenities that will draw a stronger comparison to prove actual cash value. Electronically save the advertisements about each comparable vehicle. Add up the prices of the three cars, divide the total by three for a good approximation of the actual cash value expected. Hold this information until after the adjuster has made their offer.

The owner of the wrecked car has researched a reasonable actual cash value. Now what? They wait for the offer and steel themselves for a brief negotiation.

Remind the appraiser and the adjuster of their responsibilities:

The appraiser gives the valuation to the adjuster who shares the value with the consumer. It is an offer to settle the property damage claim, not the definitive value the consumer must accept.

Is the offer fair? The owner of the totaled car now needs to compare the offer with their research. If the offer is higher than the average of the prices of the three cars located in research, it is probably safe to accept the offer. However, the consumer may wish to negotiate based on the highest price of the three cars they found. If the offer is lower than the average price of the three cars found in research, it is time to remind the appraiser and adjuster of their responsibilities. This can be done by email or by traceable paper mail: the lower the offer, the more likely a paper response is required to move the negotiation forward.

In any communication, the owner of the totaled vehicle should include the duties of the appraiser.

Motor vehicle physical damage appraisers are licensed in Pennsylvania (see With the privilege of a license comes responsibilities. The most powerful of those duties is to,

Not have a conflict of interest in the making of an appraisal. This chapter and the act, and this section in particular, shall be strictly interpreted to protect the interest of the consumer and place the burden upon the appraiser to eliminate any conflict of interest in the making of an appraisal. See 31 Pa. Code section 62.3(f)(1).

The appraiser has various valuation methods available. The consumer must read the appraisal and determine which method the appraiser used. The key is to consider whether the appraiser chose one method over the other to the consumer’s detriment.

  • The appraiser chose the guide source method. See 31 Pa. Code section 62.3(f)(1)(i).

The appraiser can choose from a list of vendors approved by the Pennsylvania Insurance Department to provide vehicle values (see approved guide source vendors on the department’s website). It appears these providers are all paid services, catering to the insurance industry. The appraiser submits information about the wrecked vehicle to the chosen service which then generates a value. The appraiser is allowed to take two values from providers on the list and average them to come up with a total value. The appraiser provides value documentation to the adjuster.

The consumer should review information submitted about the car, such as the year and mileage. Bad info in means bad info out. Confront the adjuster with any incorrect information the appraiser gave the value vendors. In the communication, show the adjuster evidence of the correct information and ask them to go back and get a new valuation. As an example, the appraiser might have submitted the mileage as 100,012 miles when it was actually, 10,012 miles. Mistakes happen.

  • The appraiser chose the actual cost method.

In the actual cost method, the appraiser finds a vehicle of “… like kind and quality in condition similar or better than the motor vehicle being appraised in its predamaged condition.” See 31 Pa. Code Section 62.3(f)(1)(ii). The appraiser may take two “actual costs of purchase” for like vehicles and averages them. The consumer should consider the comparable vehicles used based on location and attributes. First, if the vehicles the appraiser chose for comparison are farther away in distance than what the consumer’s research found, the consumer has a negotiation point. Providing the adjuster with the highest priced of the three researched cars which is closer to the consumer’s home, the consumer might pose the following, “I found this car in my area and the price seems to be higher than the ones the appraiser found. Why didn’t the appraiser choose this vehicle as a comparison when it is closer to where I actually live?” Second, if the consumer’s research value is just higher than the appraiser’s actual cost from comparable vehicles, then simply send the higher valued cars to the adjuster. The question in that scenario is, “I have attached higher valued comparable vehicles that were for sale when the appraiser came up with their valuation. Why didn’t the appraiser use these higher valued comparisons?”

Each of the queries leads directly to the insurance company’s duties to its policyholders. So, if the consumer is dealing with their own insurance company, there are additional duties to bring to bear.

  • In a communication with their own insurer, the consumer should remind the insurance company of its duties.

A car insurance company has a duty to adjust its policyholder’s claim with good faith and fair dealing. The court has described it this way, “… act with the ‘utmost good faith’ toward its insureds.” See Berg v. Nationwide Mutual Insurance, 235 A.3d 1223, 1232 (Pa. 2020)(per curiam). This duty is codified in the “… bad faith statute, under which a court may award damages ‘in an action arising under an insurance policy’ if the court finds ‘that the insurer has acted in bad faith toward the insured.’” (citing 42 Pa. C.S. Section 8371, and quoting Cowden v. Aetna Casualty & Surety, 134 A.2d 223, 228 (Pa. 1957)). “An insurer will be held to have acted in bad faith if it fails to ‘accord the interest of its insured the same faithful consideration it gives its own interest.’”

Inquiries about the appraiser’s method as we have described, by direct implication, call into question the insurance company’s utmost good faith toward its insureds. From a practical standpoint, the totaled car’s owner can quote the duties outlined above to the adjuster and provide the three comparable vehicles found. Then, “Can you explain to me how going with the appraiser’s valuation in your offer was giving my interests the same faithful consideration you gave to your insurance company’s interests, even though I was able to quickly come up with three vehicles of like kind and quality with a higher average value than the appraiser?”

  • Get to the fair price.

Leaning in to this three-step process will help a consumer determine whether they are being paid a fair price for their totaled car and will give them the tools they need to get to an acceptable value if the first offer was less than it should have been. My experience tells me your clients, friends, and relatives who find themselves in this situation will thank you for giving them a method by which they can confidently combat a system designed to force the consumer to take only what is offered.

Joseph Chapmanof counsel at McNees Wallace & Nurick, practices in the personal injury and litigation groups. Contact him at


Joseph Chapman

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