diminished value

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PostPosted: Thu May 28, 2009 5:22 am   Post subject:   

Hey if you really seeking help ask, if you're playing Columbo (oh one more thing) case solved. If you're riddling me this, send out the bat signal. Exercise over.


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PostPosted: Thu May 28, 2009 5:33 am   Post subject:   

Our man Flint? You're diaglogue sounds vaguely familiar. Ad? Sorry meant no disrespect, thought you were really looking for solutions, but seems you already have the knowledge to solve the questions you pose.


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PostPosted: Tue Jun 02, 2009 5:59 am   Post subject:   

Dear Flint,



Quote:
I'm rather disinclined to press a "dv" claim at this point. I'll probably just invite them to make an offer. (Gee, Mr. Fast Track, what would you request if you were me?) I'll see if I can find out what their policy is.





Would you please tell me what followed after this??

I guess from here the discussion had narrowed down to a different topic and I couldn't relate it to what it began with.



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PostPosted: Tue Jun 02, 2009 6:09 am   Post subject:   

Steve, when I confirmed that the shop was using new oem parts on my pickup, I kind of lost interest in pursuing it. Reading between the lines, its looks like they were accomodating me because I've been with them for 18 years, and I thought it might be somewhat ungracious of me to press it.


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PostPosted: Wed Jun 03, 2009 8:06 pm   Post subject:   

Quote:
I thought it might be somewhat ungracious of me to press it.




I do not follow your logic. You paid for coverage gambling that you would never have to use it. DV is factored into the actuaries as a loss required to be placed in reserves and paid when a claim is presented and you simply chose to allow the insurer to keep funds that are owed to you under the contract of insurance in your state only because they specified oem parts in the repair?



I have a customer who has 6000 in damage due to a comprehensive claim where a dear impacted the vehicle. The senior vehicle owner is afraid of filing a claim for fear that they may lose coverage if they use what they have paid for. They chose to pay out of pocket for their loss because of a fear factor instilled by the insurance industry designed to control costs and ensure profits at the expense of the very people they have promised to protect. I guess I just don't get it.


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PostPosted: Wed Jun 03, 2009 9:12 pm   Post subject:   

Quote:
They chose to pay out of pocket for their loss because of a fear factor instilled by the insurance industry designed to control costs and ensure profits at the expense of the very people they have promised to protect.
Did the insurance company threaten this insured in some way? Perhaps these people have heard that insurance companies may increase rates if a claim is filed. Is that illegal? If they are worried about their rates increasing, that is one thing. But please don't act like the insurance company is to blame for this "fear". To be more clear, its the nature of any insurance that rates are based on the pool of people and the amount of money paid out toward that pool. The more claims paid, the hire the rates. The insurance company keeps a portion of those funds (as would any company). So if this insured feels that not filing a claim and staying in a better pool is worth it, then that is _their_ choice_. Don't blame the insurance company for the concept of insurance.

Quote:
I do not follow your logic
It would appear that flint is applying his moral values to the insurance process and thinking the transaction was fair. Each person makes their own decision on this. Personally, I think he has a good point (new OEM parts were put on in place of old OEM parts so the vehicle is better then it was before the accident).



What I fail to understand is how you can say that someone should get ever last nickel and dime from their carrier but then also complain when the carrier increases their rates based on claims being paid out. If Flint is happy with state of the claim, then it's his choice to consider the matter settled.
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PostPosted: Thu Jun 04, 2009 12:04 am   Post subject:   

Quote:
Did the insurance company threaten this insured in some way? Perhaps these people have heard that insurance companies may increase rates if a claim is filed. Is that illegal?




In this case they only feared uninsurability, certainly they were not afraid of a rate increase as he can easily afford paying 6000 out of pocket even though most of us can't. Older people fear the ability to obtain coverage more than they fear increases. It was a use it and you lose it instilled fear.



Quote:
So if this insured feels that not filing a claim and staying in a better pool is worth it, then that is _their_ choice_. Don't blame the insurance company for the concept of insurance.




The original concept of insurance was to share the risk, "not if you use it, you're out of the group or penalized as it is today". The concept today is tthat risks are managed with micro precision computers to the point that there is little risk and guaranteed profit and the unlucky people are just out of luck and can't join.


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PostPosted: Thu Jun 04, 2009 1:49 am   Post subject:   

Quote:
In this case they only feared uninsurability, certainly they were not afraid of a rate increase as he can easily afford paying 6000 out of pocket even though most of us can't. Older people fear the ability to obtain coverage more than they fear increases. It was a use it and you lose it instilled fear
When did they tell flint that they were going to increase his rates if he filed a DV claim? I missed that post. Did he mention that they threatened him in some way? Was that in the same post?



Insurance companies _do_ increase rates when claims are filed. When your costs go up do you just continue to absorb the expenses or do you eventually charge more? Should an insurance company (a business) be a different? If a carrier increases rates they usually do so because a claim was filed and more then a minimum amount was paid out. I've never heard of one rating the increase based on the larger amount paid (I also think that might even be illegal). So please, point out where Flint's carrier threatened him into not filing a DV claim. From his post it seems like the opposite happened... they treated him so well that he's not really interested in pursuing a DV claim. Not _THAT_ I did read him post!

Quote:
The original concept of insurance was to share the risk, "not if you use it, you're out of the group or penalized as it is today"
That is only one part of it. Another is insurability and risk. Carriers have always adjusted rates based on risk. They also have always pooled insured's into similar risk groups. You really think 100 years ago that carriers did not increase rates of those that filed many claims? They did.... it was just not as easy to track this information as it is now.

Quote:
there is little risk and guaranteed profit
Oh, you know as well as anyone that there is no guarantee of provide for an insurance company. Many have been loosing their butts as of late. There has also been a steady amount of them closing their doors and being bought out by more profitable companies.
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PostPosted: Thu Jun 04, 2009 11:29 am   Post subject:   

Quote:
I have a customer who has 6000 in damage due to a comprehensive claim where a dear impacted the vehicle. The senior vehicle owner is afraid of filing a claim for fear that they may lose coverage if they use what they have paid for. They chose to pay out of pocket for their loss because of a fear factor instilled by the insurance industry designed to control costs and ensure profits at the expense of the very people they have promised to protect. I guess I just don't get it.
I don't get it either, (re: this elderly customer of yours) Mike have you told or shown her (MO unfair claims practice regs) that she CANNOT be rated up or dropped for a comp claim? (if you need a link let me know)...I get older folks like this all the time, they're just scared (often) of being 'dropped' by their carrier. I also agree with Todd how is this the carriers fault? If the insured would educate themselves they would see that in most cases this is against the law and doesn't happen. They are also afraid that they dmv or their doctor will make them give up driving, again, that 'irrational' fear is no ones fault but the one with that irrational fear. If you explain to her there are laws and regulations that prohibit carriers from doing so maybe that will help...
Quote:
If Flint is happy with state of the claim, then it's his choice to consider the matter settled
I couldn't agree more with this statement Todd...it's individual...and who are we (or Mike) to insist he push a DV claim thru when he doesn't want to...I have people all the time, that don't want use their medpay (they have health coverage) and although double dipping is allowed in our state, they don't think it's ''right'' or the right thing (ethically) to do...I always explain to them, 'hey you are entitled to this you paid for the coverage' but if they are satisfied and don't want to pursue that then so be it...



Quote:
Insurance companies _do_ increase rates when claims are filed.
SOME claims...(i know you know this todd, just adding this for those who do not)...Most states have in their fair or unfair claims practice statutes that you cannot suffer a rate increase if a claim is not your fault, if it's a comp claim (unless there is a 'pattern' then you'll likely be non-renewed)...NO carrier can automatically increase rates for any claim that comes to a policy...it depends on the 'type' of claim...that being said, some carriers may have a 'no claim' disoount that you (i'm assuming) could lose if you file a claim regardless of it's impact to your premium..but that is not a premium increase.


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PostPosted: Thu Jun 04, 2009 1:43 pm   Post subject:   

See, tcope, matters of high principle are frequently drawn into clearer focus through hypothecation. As for my particular situation, well, being an adjuster, I have ever in mind the Greater Good.


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PostPosted: Thu Jun 04, 2009 2:13 pm   Post subject:   

Quote:
Many have been loosing their butts as of late. There has also been a steady amount of them closing their doors and being bought out by more profitable companies




The ones that are losing their butts are the not in the auto insurance sector, those were companies that insured loan risks. The only other companies who's stocks are poor performing these days are the same ones not living up to the promises they failed to deliver or customer satisfaction that they failed to deliver.



As a business owner, it was suggested to me by one of the leading proponents of DV that, the repairer should manage the consumer expectations. Deliver to them what they expect and are owed by the shop's contract and nothing less. I don't wear an "S" on my chest and I don't negotiate or fight for any vehicle owner. I merely give them resources for them to come to their own conclusions and they fight their own battles as I am not a party to their contract of insurance.



As far as our man Flint, I am not pushing for him to collect DV. In fact, I think there is little damage there that would harm his resale value. That's his choice. I told someone who contacted me just yesterday on a three thousand dollar claim with all bolt on parts that the claim would be insignificant enough to hire an appraiser or an attorney and that they should use small claims court or statements from dealer trade ins to make their case if they chose to pursue it.



Our man Flint made a decision that he was satisfied with and was appeased by the use of oem parts and replace in lieu of repair processes. This is the only reason I even began assisting people with DV claims. If some insurers insisted on repairing things that should be replaced and using inferior parts, then I believed they had a significant argument that their vehicle would be devalued because of repair decisions out of the vehicle owner's control and if asked, I offered assistance.



It is the concept that vehicles can't be repaired as good as before a loss(whether because of innept repairers or insurers failing to pay for pre-loss or a first rate repair owed under contract) that have fueled DV claims, not people marketing the concept. Diminishment of value has been documented well before the turn of the century among the earliest of court cases involving settlements of some actual cash value policies and virtually all third party claims under the restatement of torts.



The choice to be appeased rather than compensated for additional losses that could be owed is a personal decision and not a moral decision in my opinion.


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PostPosted: Thu Jun 04, 2009 3:11 pm   Post subject:   

Quote:
The ones that are losing their butts are the not in the auto insurance sector, those were companies that insured loan risks. The only other companies who's stocks are poor performing these days are the same ones not living up to the promises they failed to deliver or customer satisfaction that they failed to deliver.
Very few carries only write auto policies... most write at least auto and home. It's all premiums from P&C policies. Companies are not doing well because of property losses (storms) but also because the market is so bad. Many companies spend $1 for every dollar they take in. They make their money by investing that money in the meantime. We all know how the market is right now so many carriers are losing money. It has nothing to do with service.

Quote:
As far as our man Flint, I am not pushing for him to collect DV
I'll let your own posts speak for themselves:
Quote:
I do not follow your logic. You paid for coverage gambling that you would never have to use it. DV is factored into the actuaries as a loss required to be placed in reserves and paid when a claim is presented and you simply chose to allow the insurer to keep funds that are owed to you under the contract of insurance in your state only because they specified oem parts in the repair?
Quote:
They chose to pay out of pocket for their loss because of a fear factor instilled by the insurance industry designed to control costs and ensure profits at the expense of the very people they have promised to protect.
This was in response to Flint saying that he did not want to pursue a DV claim.

Quote:
Our man Flint made a decision that he was satisfied with and was appeased by the use of oem parts and replace in lieu of repair processes. This is the only reason I even began assisting people with DV claims. If some insurers insisted on repairing things that should be replaced and using inferior parts, then I believed they had a significant argument that their vehicle would be devalued because of repair decisions out of the vehicle owner's control and if asked, I offered assistance.
I'm not sure I follow that.... but here is something that I've never understood....

Quote:
It is the concept that vehicles can't be repaired as good as before a loss(whether because of innept repairers or insurers failing to pay for pre-loss or a first rate repair owed under contract) that have fueled DV claims, not people marketing the concept
I'm glad you posted this as it makes a response much easier.... it's simply incorrect. You say that carriers should only use new OEM parts in place of old parts and that they should not limit, in any way, what a shop does or charges for the repairs. In this case new OEM parts were used to replace old parts, there is no indication that any limitations were put on the repairs, _and_ the owner appears to be please with the results. Yet you still say that the vehicle is not as good as before. I'll ask... why not? This all leads to what I've said many times before.... DV is a _percieved_ drop in value. That is, the vehicle really _is_ in the same condition (really better) then before the accident and people just thing they can buy a damaged/repaired vehicle for less. Now, where do they get that impression from?
Quote:
I merely give them resources for them to come to their own conclusions and they fight their own battles as I am not a party to their contract of insurance.
Oh, yeah. Now I remember.
Quote:
The choice to be appeased rather than compensated for additional losses that could be owed is a personal decision and not a moral decision in my opinion
I guess if you throw morals out of the equation it's much easier to agree with your point.
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PostPosted: Thu Jun 04, 2009 3:47 pm   Post subject:   

Quote:
DV is a _percieved_ drop in value. That is, the vehicle really _is_ in the same condition (really better) then before the accident and people just thing they can buy a damaged/repaired vehicle for less. Now, where do they get that impression from?




Two thoughts, Market and availability drive pricing. What a willing buyer and what a willing seller agree to in an open market sets the price. So the value of anything is determined by what the market or people determine it's worth or value to be.



So according to your logic, and your belief that a repaired vehicle is just as good as one that has never been in an accident and given the opportunity to select from two identical vehicles (one with an accident history of 4000 dollars, and one that is pristene and no stigma of accident history) you believe the average buyer would pay an identical price for the vehicle with the accident history. Not even likely.



Our man Flint was pushing for justification of DV owed to him as I interpreted his posts and was only appeased when instead of a/m parts and puttying a panel they were replaced with new oem. Good for him, he got what he was owed and deserved. If all claims were handled like that, the DV perception would diminish itself. The public perception that some insurers pay only for cheap repairs contribute to drive the values of repaired cars down.



Quote:
It all depends on the yr/make/model, type of damage etc...Mike, is a regular poster with a lot of knowledge about DV I'll send him a note to see if he will jump in this thread...hold tight, in the meanwhile, post yr/make/model/mileage, and 'type' of damage.


I was inquired of my opinion of DV in this situation and I gave it, I didn't jump the post to urge anyone to demand DV.



The similarities in the post about the older couple that feared uninsurability and Our man Flint, was that I simply was making a correlation of you pay for coverage and you are entitled to it and you should not feel guilty for asking for what is owed you under the terms and conditions of any policy. Leaving money owed to you on the table for the insurer wasn't, in my opinion, a matter of ethics as much as it was just a personal choice, just as the older couple made in not filing a claim.


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PostPosted: Fri Jun 05, 2009 10:57 am   Post subject:   

Quote:
I told someone who contacted me just yesterday on a three thousand dollar claim with all bolt on parts that the claim would be insignificant enough to hire an appraiser or an attorney and that they should use small claims court or statements from dealer trade ins to make their case if they chose to pursue it.
Just as a matter of curiosity only...what is the yr/made of this vehicle and what would you think this owner is owed on a DV claim, with all bolt on parts, and I am assuming a fair - good repair job, with new oems parts?
Quote:
So according to your logic, and your belief that a repaired vehicle is just as good as one that has never been in an accident and given the opportunity to select from two identical vehicles (one with an accident history of 4000 dollars, and one that is pristene and no stigma of accident history) you believe the average buyer would pay an identical price for the vehicle with the accident history. Not even likely.
Ok, if we go on this assumption...then when I'm figuring an ACV on a total loss then it is only fair that I not only deduct from that ACV any UNREPAIRED prior damage, but I must also deduct from it's value, this 'diminishment' it suffered from any and all prior repairs that pop up when I run and ISO on that totaled vehicle...so now we have a vehicle that has an ACV at 5k, I pull ISO, and this vehicle has had four prior losses in it's life, all repaired, and repairs done well..well poor sap, I'll have to find out how much was paid for each repair then deduct the appropriate DV amount for each loss/repair (whether they got one or not and if they did get a dv payment/claim then I would deduct that amount exactly)..from the value of their vehicle! So now after I remove the loss of value (dv) this guys car suffered because he repaired it, his vehicles ACV is now about a buck fifty...



You can't have it both ways...if properly repairing a vehicle STILL causes (in your opinion mike) a loss of value that the owner is to be paid..then when and if that vehicle totals, every repair made to it caused a dimishment in it's value. I as the adjuster can and should take those amounts away from his vehicles ACV...right? Has to be!! you can't have it both ways...man talk about a can of worms. Rolling Eyes



In fact I'd say if DV grows and is paid on nearly every claim, there is no choice, nor would it be right NOT to remove that same amount from the ACV when that vehicle totals...


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PostPosted: Fri Jun 05, 2009 12:30 pm   Post subject:   

Quote:
So according to your logic, and your belief that a repaired vehicle is just as good as one that has never been in an accident and given the opportunity to select from two identical vehicles (one with an accident history of 4000 dollars, and one that is pristene and no stigma of accident history) you believe the average buyer would pay an identical price for the vehicle with the accident history. Not even likely.
I'll tell you what is unlikely... that this situation would every happen. I've bought a few vehicles in my day and been to a few lots... I've _never_ seen two, exact identical vehicles, one damaged and one not, for sale. People _love_ to use this example to prove their point... only problem is... it never happens. I've also bought vehicles with prior repaired damaged. The prior damage has never been discussed but I've always negotiated a price that was acceptable to both the buyer and the seller. Was this price lower then the exact same vehicle without prior repaired damage? Well, we will never know... as, mentioned above, that situation never happens.



Have people attempted to negotiate a lower price because of prior repaired damage? I'm sure it's happened. Was the selling price lower solely because of this prior repaired damage? You tell me. Please provide examples if you have them. What I can show to you is that no vehicle valuation guide that I know of gives the option of displaying a lower price for prior repaired damaged vehicles. Why is this, if it happens all of the time?

Quote:
I was inquired of my opinion of DV in this situation and I gave it, I didn't jump the post to urge anyone to demand DV.
Yes Mike, you did. I pointed that out in my prior post. Flint mentioned he was not going to purse a DV claim and why. You then jumped and told him you did not understand why he was not going to and gave some examples of why he should. So you _clearly_ were not responding to a question of "if" a DV claim should be pursued. But to each their own. Your certainly free to post as you wish. I'd have it no other way.
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