Take settlement? Repair or not?

chisueOctober 30, 2012

The insurance company for the at-fault driver is offering to repair our 2005 Jaguar X-Type (22K miles). They'd pay the $7000 repair shop estimate to fix driver's side damages.

I'm concerned about whether the car will have any value as a trade-in after the repairs are made. The damages will be on any 'history' report. Before the accident the car had a retail value of about $14K.

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Ask your insurance agent to see what they say. Its very hard for me to assess since I don't know the extent of the damage or the shop who will do the repair. Its one of those "it depends".

Of couse, a future buyer will try to downgrade the price using "It has been in an accident" as a lever. However, it could be as good as any other copy of the same car. For example: Suppose there were no structural damage and it was only sheet metal involved. An example repair might have been bolting on a new fender and re-skinning a door or replacing the door, and then painting. A good shop would have applied rust proofing on the inside of the door panel, preped and primed the surface to be painted, color matched the paint, re-painted and applied a clear coat if appropriate. The repaird portion would be as good as new. It would have fresh paint and would be better than the remainder of the car. In that case, it could be considered 'restored' and there should be no decline in value.

However, if the structure was bent and had to be straightened, there could be a deduction. Again, it depends on the shop. A good shop can bring the body check points back into specified measurements, but there could be items hard to fix. The process of bending can crack rust proofing finishes and compromise effectiveness. Premature corrosion could occur. In this case, there is a downgrade of value.

Its the hidden things I'd be concerned about. When a car door is re-skinned, the repairman may take a short cut. If, in the process, the rain sheet on the inside of the door was cut away for convenience and not replaced, this may not show up until several months afterward and after rains. After the cover panel on the insde of the car gets soaked from behind, it may begin to deterioate. The first hint might be a musty smell or a stain. Another potential problem, again a short cut, the repairman paid no attention to the water drains at the bottom of the door and allowed these to be plugged. A quality shop would have insured these drains were open.

The bottom line is, I would have no problem if the repair was made by a quality shop. If there were major structural damage, there could be a drop in value.

Your car is a desireable car and there are not many of those in the States. You have the option of keeping the repair money and selling the car as is, if you can find a buyer. It would be a hobbyist who restores autos.

If the opponent's insurance company is willing to pay for a quality repair, that is a good option. First, get an estimate from a shop recommended by your insurance agent to discover if enough was allowed for the repair.

    Bookmark   October 30, 2012 at 8:42PM
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Jemdandy -- Thanks for the input. I'll see if I can use the knowledge to impress the body shop by asking about the 'short cut' points you raise!

I talked to the body shop yesterday. The pillar between the two driver's side doors *was* bent and will have to be straightened. If they discover any further damage (rocker panel, etc.) they will go back to Chubb to authorize more repair money.

The Jaguar dealership rep -- who sent our car to this shop -- says they will stand behind the work. They will check the alignment and to see that all air bags are functional.

My thought is to tell Chubb that I want an additional $1K for the diminished value on a repaired car. I guess I can *try*. Perhaps we'd put the repaired car 'on the market' for proof of diminished value. 'Repaired' doesn't put us where we were before their driver broadsided the car.

This isn't a unique car. It's been our family car since we bought it (certified from a Jaguar dealer) with 2700 miles on it. Jaguar created the X-Type to lure buyers into the brand, thinking they'd upgrade to the bigger models. I think they were surprised when people preferred this model to the bigger ones! I sure do. (It misses some winter weather when we are out of town January and February.)

    Bookmark   October 31, 2012 at 8:12AM
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Ur title is confusing? If u don't repair car, will the insurance co give u 14k? Ur car has 7k damage. Ins co pays shop 7k and it is fixed. They will not total it and give u 14k? Right?

    Bookmark   November 2, 2012 at 11:34AM
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Upon reconsideration, we've lost more than I thought.

Before the accident we had a car worth $14K. The Kelley Blue Book Retail Value is $15,600; Trade-In Value is $12K.

After extensive body work, our car will be worth less. The insurance company for the at-fault driver is paying $7K for repairs, but we will no longer have a car worth $14K.

Let's say we could get $9K for our repaired car. We are 'out' $5K.

It looks like we must sue the at-fault driver for our loss.

Car is 2005 Jaguar X-Type VDP Sport Package 22K miles One owner Non-smokers, Not Overweight Garage Kept All Records

    Bookmark   November 3, 2012 at 3:07PM
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Re-check your policy. See what the insurance companies obligations are. You may or may not have the option of telling the insurance company that you want the car totaled and would prefer to take fair market value before the accident.

FWIW, if the car is repaired properly I don't believe it's value would be diminshed by 35%(5k/14k) because of it's history except if you want a quick sale.

I suspect, they will argue the car is as functional and reliable as it was before the accident regardless of your perceived devaluation.

    Bookmark   November 9, 2012 at 1:16PM
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Thank you, sdello.

Today's news: The repairs are more extensive -- now include new pillar and rocker panel. Insurance approves $8000 repair estimate.

Also: Our bank's loan department tells me they'd value the car at $10,600. Really? Local dealers are advertising non-loaded low-mileage 2005's at up to $18K.

I can't find out the *actual* values for our car before the accident, and after repairs. Should I assume it's $10,600 if declared 'totaled'?

I am learning more than I ever wanted to know about used cars! Thanks for bearing with me.

    Bookmark   November 9, 2012 at 5:59PM
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Your bank, for collateral purposes, will value the car based on its wholesale value, not retail. They will value it at what they think they could get at auction should they have to take posession. This "quick sale" price is lower than retail. The so-called retail price posted on a used car in a dealer's lot is retail or whatever he hopes he can get from the buyer.

If your place of employment has a credit union, ask to see their list of used auto values. This listing will be different to that you might buy off a magazine rack. Ask the loan officer for an opinion on value.

    Bookmark   November 11, 2012 at 4:54AM
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