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 Posted: Wed Nov 12, 2008 3:22 am Post subject: I have a 2000 Grand |
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| I have a 2000 Grand Prix that was recently totaled that I still owe money on. The insurance company is only offering to pay half of what is left of the loan. Doesn't the insurance company have to pay the rest of the loan since I can no longer drive the car? |
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Taj1022
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| Posted: Wed Nov 12, 2008 4:06 am Post subject: Gap Insurance |
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Unfortunately, the insurance company is not obligated to pay the amount you owe on the vehicle, only the amount they say the vehicle is worth. Granted, you may be getting a low-ball estimate - and you should fight for every penny - but they're only contracted to pay value of the car at the time of the accident.
A policy you could have had to cover the additional expense is called Gap Insurance. Finance companies typically offer this sort of coverage. |
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CarInsuranceGuy
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| Posted: Wed Nov 12, 2008 6:02 am Post subject: |
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When I hear of people owing twice as much as the insurance company is going to pay I have to think that something went terribly wrong when the car was purchased (rolled over a prior loan, bad financing, made offer thinking it was new when it was really 8 years old, etc).
As I always tell people... I could pay $100,000 for a 10 year old Escort... it does not obligate the insurance company to address that decision. |
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tcope
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| Posted: Wed Nov 12, 2008 7:28 am Post subject: |
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| Quote: | | Doesn't the insurance company have to pay the rest of the loan since I can no longer drive the car? |
No, the insurance company owes you only the amount that the car will fetch from the market, which is the actual cash value of the car. If you have a Gap insurance on the vehicle, that would take care of the rest of the loan amount, otherwise, you may have to bear the cost out-of-pocket.
~Jeremy |
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JeremyHolter
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| Posted: Wed Nov 12, 2008 7:33 am Post subject: |
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Sorry Taj, I too agree with the other poster and can't say anything to cheer you up on this upside down situation. The insurance company isn't obligated to pay more than you deserve. The value of the car diminishes with time & it loses almost 20% of its value the time you roll it out of the dealer's shop. Hence, you'll always receive less value on the car than you have paid to own it.
| Quote: | | As I always tell people... I could pay $100,000 for a 10 year old Escort... it does not obligate the insurance company to address that decision. |
Quite so! |
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RupertWBradson
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| Posted: Wed Nov 12, 2008 11:11 am Post subject: |
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Everyone is going to agree they owe you the ACV only, not your payoff...Do you have GAP insurance?
_________________
"Never, never be afraid to do what's right, especially if the well being of a person or animal is at stake. Society's punishments are small compared to the wounds we inflict on our soul when we look the other way." Martin Luther King Jr. |
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Lori
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| Posted: Wed Nov 12, 2008 12:27 pm Post subject: |
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| I wouldn't see wht they would pay anymore than that. If it is in fact a roll over from another from another loan as Tscope says then they wouldn't just be paying for the car ruined in an accident but the prior vehicle too. That one wasn't in the accident so they def. wouldn't pay for it. |
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fireyone
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