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-   -   Hurricane Sandy Total Loss...need advice (http://www.bimmerfest.com/forums/showthread.php?t=657398)

Colbert 11-10-2012 05:56 PM

Hurricane Sandy Total Loss...need advice
 
Had my brand new Black Sapphire 328xi for only 2 days, and it was flooded by Hurricane Sandy in my building's garage. Car was being financed and only had 48 miles on it. I have comprehensive coverage, however no gap insurance, and my insurance company is offering me $11000 than what I paid for it. That is a huge hit for a 48 hour old car. Does anyone have any advice on if I could fight this?

Colbert 11-10-2012 05:58 PM

Sorry, $11000 less than what I paid

justinnum1 11-10-2012 06:04 PM

what!!!!!!!!!

you have to take an $11,000 hit on the car?????

I dont think there is much recourse here without gap insurance...make sure you get the gap insurance next time around.

SamS 11-10-2012 06:05 PM

Ouch, seriously no gap insurance? I honestly don't think you'll have any options. Unless you want to try to pursue something under your homeowner's policy. But even that would be a long shot.

tturedraider 11-10-2012 06:13 PM

Quote:

Originally Posted by justinnum1 (Post 7187831)
what!!!!!!!!!

you have to take an $11,000 hit on the car?????

I dont think there is much recourse here without gap insurance...make sure you get the gap insurance next time around.

Yes there is.

OP, it sounds like you may have to sue your insurance company. You need to talk to a lawyer ASAP. You should ba able to recover 100%, or very, very close, of your purchase price. Do NOT roll over. There is a thread going right now by a guy whose car was just totalled. Read the post near the end of the thread by the insurance agent.

btw - GAP coverage actually has nothing to do with your claim.

Colbert 11-10-2012 06:20 PM

Honestly, this is my first vehicle, and I had no idea what gap insurance was. It wasn't offered at the dealership nor by the financing company, so i was completely blind...

SamS 11-10-2012 06:20 PM

What grounds does he sue on?

He might be able to negotiate closer to a $5k delta on what he owes vs what they give him. They offer gap insurance for just this scenario.

Colbert 11-10-2012 06:20 PM

I'll be sure to consult a lawyer ASAP

bmw_or_audi 11-10-2012 07:50 PM

Wow, a quick google search turned up these two articles worth reading:

http://www.bankrate.com/finance/insu...t-for-you.aspx

http://www.progressive.com/understan...p_insuran.aspx

It seems like gap insurance is almost a requirement for the first couple of years of ownerships. One of the articles recommends it only if you don't have a large down payment, as if that changes the amount you will lose. It doesn't. The only difference is you are losing money you have already paid versus money you will have to pay.

Really, a car loses 25-30% in the first year? OK, but in the first week? Shouldn't the loss be closer to 10%? You should find out the market value of a similar car that has been used only at most a couple of months.

Maybe the insurance company looked at the cash value of a one year old car with typical mileage, and a lawyer might be able to argue that they should use a different metric for a car this new.

Good luck.

tturedraider 11-10-2012 07:51 PM

First off, your insurance company is flat out trying to rip you off. Who is your insurer? This is a really good example of the difference in insurance companies. Insurance is not just a generic product across the board. All insurance companies are not the same.

Second, the posts here indicate a lack of understanding of what GAP insurance is. GAP insurance does nothing more than pay the difference between the loan balance and the value of the car at the time of the loss. Let's say you borrowed 100% of the purchase cost, say $49,000. Say a year from now the loan balance is $40,000, but the actual cash value has dropped to $38,000. GAP insurance would pay the $2,000 difference.

Your situation is not typical. At two days old with 48 miles your car is still worth, for insurance replacement purposes, 100% of the sale price you paid.

Again, I'll refer you to the ongoing thread by the member whose virtually new car was just totalled. The circumstances are different, but the issue is the same.

justinnum1 11-10-2012 07:57 PM

Quote:

Originally Posted by tturedraider (Post 7187997)
First off, your insurance company is flat out trying to rip you off. Who is your insurer? This is a really good example of the difference in insurance companies. Insurance is not just a generic product across the board. All insurance companies are not the same.

Second, the posts here indicate a lack of understanding of what GAP insurance is. GAP insurance does nothing more than pay the difference between the loan balance and the value of the car at the time of the loss. Let's say you borrowed 100% of the purchase cost, say $49,000. Say a year from now the loan balance is $40,000, but the actual cash value has dropped to $38,000. GAP insurance would pay the $2,000 difference.

Your situation is not typical. At two days old with 48 miles your car is still worth, for insurance replacement purposes, 100% of the sale price you paid.

Again, I'll refer you to the ongoing thread by the member whose virtually new car was just totalled. The circumstances are different, but the issue is the same.

where is this thread? link?

SamS 11-10-2012 08:01 PM

Quote:

Originally Posted by tturedraider (Post 7187997)
First off, your insurance company is flat out trying to rip you off. Who is your insurer? This is a really good example of the difference in insurance companies. All insurance companies are not the same.

Second, the posts here indicate a lack of understanding of what GAP insurance is. GAP insurance does nothing more than pay the difference between the loan balance and the value of the car at the time of the loss. Let's say you borrowed 100% of the purchase cost, say $49,000. Say a year from now the loan balance is $40,000, but the actual cash value has dropped to $38,000. GAP insurance would pay the $2,000 difference.

Your situation is not typical. At two days old with 48 miles your car is still worth, for insurance replacement purposes, 100% of the sale price you paid.

Again, I'll refer you to the ongoing thread by the member whose virtually new car was just totalled. The circumstances are different, but the issue is the same.

I am very clear about what GAP coverage is, but you don't seem to be comprehending the situation as the OP is describing to us.

Assume he borrowed 100% of the purchase cost, let's say $45K. Add his financing cost of $2K, and now he has a loan of $47K that is outstanding. The insurance company looks at auction prices of used 2013 F30s and comes up with a value of $36K. Sure, that is low and he should fight it. $47K owed on his note vs. insurance evaluation of $36K is that $11K gap. And GAP insurance would cover that! He could probably fight that $36K valuation, and maybe get it up to $42K. But he's still going to be left with a gap of the insurance valuation vs. what he owes on the note. Maybe $5K.

You make an incorrect assumption that a 2 day old car is worth 100% of the purchase price. Every try to sell your 2 day old car to a dealer across town for the same price you just bought it for?

golovko 11-10-2012 08:08 PM

Quote:

Originally Posted by SamS (Post 7188008)
I am very clear about what GAP coverage is, but you don't seem to be comprehending the situation as the OP is describing to us.

Assume he borrowed 100% of the purchase cost, let's say $45K. Add his financing cost of $2K, and now he has a loan of $47K that is outstanding. The insurance company looks at auction prices of used 2013 F30s and comes up with a value of $36K. Sure, that is low and he should fight it. $47K owed on his note vs. insurance evaluation of $36K is that $11K gap. And GAP insurance would cover that! He could probably fight that $36K valuation, and maybe get it up to $42K. But he's still going to be left with a gap of the insurance valuation vs. what he owes on the note. Maybe $5K.

You make an incorrect assumption that a 2 day old car is worth 100% of the purchase price. Every try to sell your 2 day old car to a dealer across town for the same price you just bought it for?

He described GAP insurance correctly. You disagreed and described it exactly the same way. I'm confused? :dunno:

SamS 11-10-2012 08:19 PM

Quote:

Originally Posted by golovko (Post 7188011)
He described GAP insurance correctly. You disagreed and described it exactly the same way. I'm confused? :dunno:

Of course he did, and I agree with his description. I disagree with his assessment that GAP insurance is not applicable to this situation, and that the $11k number is somehow grounds for a lawsuit. My example shows clearly how they could have arrived at that $11k. Not saying that it's fair, rather that it is plausible based on math.

tturedraider 11-10-2012 08:34 PM

Quote:

Originally Posted by justinnum1 (Post 7188002)
where is this thread? link?

I'm on my phone and can't post the link. "Total loss" by NeverOddorEven

EnerJi 11-10-2012 08:39 PM

There's absolutely room for negotiation here, the OP should be able to close the gap (no pun intended) to less than $5k with adequate negotiation. Please do share the insurance company so that I know who to stay away from!

beden1 11-10-2012 09:09 PM

I got this email from BMW today. Maybe this will help the OP.

WE KNOW WHAT YOU’VE BEEN THROUGH. WE’D LIKE TO HELP.

Dear,

For many of us, Hurricane Sandy literally turned our lives upside down. Here at BMW Headquarters, our offices were forced to shut down for days and many of our tri-state employees’ personal lives have been dramatically impacted. With so much damage hitting so close to home, we feel proud that BMW was able to donate $1 million to the American Red Cross to support relief efforts in the areas where help is needed most.

We would also like to extend assistance to any of our owners whose BMWs were damaged beyond repair in the storm. To help you regain your mobility, we would like to extend a special credit on a new or Certified Pre-Owned BMW. This offer can be used in conjunction with all current offers. Please contact your local dealer or call BMW Customer Relations at 1-800-831-1117 to get details about the program.

We know nothing can fully compensate for what you might have lost. At times like these, our attention turns to what really matters. For us, it’s our BMW “family” – that’s you, our owners. Please accept our wishes for a speedy return to normal.

Sincerely,
Peter Miles
Executive Vice President, Operations

DigitalMPower 11-10-2012 09:16 PM

Lots of mis-information going on in this thread. As ttureraider stated I am an underwriter for a large P & C and can offer an answer to any question you may have.

Long story short I won't sit here and harp on GAP. I saw someone mention something about a homeowners policy, please do not try that you would be wasting your time as owned autos are excluded in every way on your homeowners policy short of personal property located inside of them.

You have no grounds to sue your insurance company based on an initial settlement, I'm not an attorney but you would be looking more at bad faith in suing your own carrier and I don't think you are to that point yet. I would think that your first point of contact would need to be with your adjuster or to review your policy: does it have some type of endorsement for replacement coverage if your car is a total loss in the first 12 months and your are the first owner?

Next, correspond with your carrier and just voice your opinion, without the above named endorsement I think you will take a loss and it can be justified by the policy language/carrier by reading Part D of your polic Coverage to Damage to your Auto - as they owe the lesser of the cost to repair or replace the vehicle on an actual cash value basis. ACV is noted as replacement cost - depreciation. $11k is ridiculous but I would think using $45k as an example you would be looking in the $39-42k range.

Please feel free to shoot me a PM and I will be glad to give you any other information as insurance companies can be tough to deal with depending on the carrier. There are dozens I would never think about using due to their business practices.

boltjaM3s 11-10-2012 09:19 PM

Quote:

Originally Posted by Colbert (Post 7187824)
Had my brand new Black Sapphire 328xi for only 2 days, and it was flooded by Hurricane Sandy in my building's garage. Car was being financed and only had 48 miles on it. I have comprehensive coverage, however no gap insurance, and my insurance company is offering me $11000 less than what I paid for it. That is a huge hit for a 48 hour old car. Does anyone have any advice on if I could fight this?

First off, very sorry to hear this, just terrible news.

You have comprehensive but no gap so you're not going to get anything from your insurance company. Two thoughts:

1. Not sure if FEMA covers anything related to automotive damage.

2. Your BMW dealer may agree to give you a $3-5K discount on a new car based on your unusual circumstances or sell you a well-equipped loaner to make up some of that $11K gap.

BJ

fb88 11-10-2012 09:52 PM

(add on info on the total loss topic)
If you paid car in cash I guess this type of additional coverage would be needed. I don't know the add-on cost of this option.

AllState insurance offers this option: New Car Replacement If your new car is totaled within the first three model years (ouch!), you can get a new car - not just a check for the totaled car's depreciated value.
http://www.allstate.com/insurance-ma...nceptions.aspx

Colbert 11-10-2012 09:55 PM

Thanks for all the info guys. I've gotten the same email beden1, but its only for $1500, and you have to finance through BMW.

tturedraider 11-10-2012 10:02 PM

Quote:

Originally Posted by DigitalMPower (Post 7188068)
Lots of mis-information going on in this thread. As ttureraider stated I am an underwriter for a large P & C and can offer an answer to any question you may have.

Long story short I won't sit here and harp on GAP. I saw someone mention something about a homeowners policy, please do not try that you would be wasting your time as owned autos are excluded in every way on your homeowners policy short of personal property located inside of them.

You have no grounds to sue your insurance company based on an initial settlement, I'm not an attorney but you would be looking more at bad faith in suing your own carrier and I don't think you are to that point yet. I would think that your first point of contact would need to be with your adjuster or to review your policy: does it have some type of endorsement for replacement coverage if your car is a total loss in the first 12 months and your are the first owner?

Next, correspond with your carrier and just voice your opinion, without the above named endorsement I think you will take a loss and it can be justified by the policy language/carrier by reading Part D of your polic Coverage to Damage to your Auto - as they owe the lesser of the cost to repair or replace the vehicle on an actual cash value basis. ACV is noted as replacement cost - depreciation. $11k is ridiculous but I would think using $45k as an example you would be looking in the $39-42k range.

Please feel free to shoot me a PM and I will be glad to give you any other information as insurance companies can be tough to deal with depending on the carrier. There are dozens I would never think about using due to their business practices.

Just a short note. I agree with you about not moving immediately to a lawsuit. I made the lawsuit assessment based on the likelihood of "bad faith" I would anticipate given the insurance company's utterly ridiculous low offer. I take that as an indication they are very likely to be unreasonable and uncooperative with the OP.

Again, given the circumstances of the OP I stand by my assertion the OP, with good representation, should be able to recover 100%, or very near 100%, of the purchase price of his car, plus tax, title and license.

Quote:

Originally Posted by boltjaM3s (Post 7188072)
First off, very sorry to hear this, just terrible news.

You have comprehensive but no gap so you're not going to get anything from your insurance company.

BJ

Totally incorrect. Comprehensive is the exact coverage that will cover this loss.

boltjaM3s 11-10-2012 11:49 PM

Quote:

Originally Posted by tturedraider (Post 7188117)

Totally incorrect. Comprehensive is the exact coverage that will cover this loss.

I was referring to the insurance company not covering the gap.

BJ

JustinTJ 11-11-2012 12:45 AM

The only difference between replacement cost and actual cash value is a deduction for depreciation. Both are based on the cost today to replace the damaged property with new property.

The amount of depreciation is the only item up for debate. There will be some loss, but no way I'd accept anything near 11k. 2-5 tops.

tturedraider 11-11-2012 05:45 AM

Quote:

Originally Posted by boltjaM3s (Post 7188161)
I was referring to the insurance company not covering the gap.

BJ

OK.

Quote:

Originally Posted by JustinTJ (Post 7188181)
The only difference between replacement cost and actual cash value is a deduction for depreciation. Both are based on the cost today to replace the damaged property with new property.

The amount of depreciation is the only item up for debate.

Bingo.


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