An Immediate Concern
Getting your car fixed or replaced after an Oregon auto collision is an immediate concern. Many of our clients put this first on the list, even when they are badly injured, and in some ways, that makes sense. Life does not stop after a serious injury.
By the time we first meet with our Oregon and Washington injury clients, the car damage issues (we lawyers call it the "property damage" claim) has long since resolved. So here are some thoughts on how to get your car fixed or replaced after a collision, and some tips on how to get your property damage claim squared away.
The General Rule
Oregon law says you are entitled to recover loss of your car's value when it is damaged in an auto collision. If a car is repairable, the general rule says the cost of repair will restore the car to its original value. However, even after a car is repaired, its value may be diminished, which means you may have an additional claim. (Read more about diminished value claims below).
If the car is damaged beyond repair, then you are entitled to the fair market value of the car at the time the collision occurred. The “fair market value” is what a willing buyer would pay a willing seller for your car in its pre-collision condition. Insurance companies will determine the cost of repair and compare that cost to the car's fair market value. If the cost of repair is close to or greater than the car's value, the insurer will consider the car a "total loss," or "totaled." Insurers use data bases to find out what people are paying for the same year, make and model car that was totaled in the collision to come up with an offer of settlement. Insurers do not move much from their total loss value offers for a couple of reasons. First, the insurance company feels like it has the data to back up its offer. Also, insurers know that most people need their car to keep on doing the things we do every day.
Sometimes, even after a car is fixed, it is still not worth what it was before the collision. If you went to a used car lot, and side by side were two cars that were the same make, model, year, and mileage, but one of those cars had been in a collision and repaired, which one would you buy? Or, would you pay more or less for the car that had been in the collision. This is what we are talking about with diminished value.
Diminished value claims require a bit more proof. When we handle a diminished value claim, we often have an appraiser review all repair documents, and sometimes even inspect the car. The appraiser will then make an estimate of the diminished value, and that forms the basis of our demand for settlement.
Generally, the older the car, the less the diminished value claim, if there is one at all. Cars lose their value over time, and at a certain point, the car's value may not change all that much, even if it is damaged in a collision, and requires repair.
Loss of Use
In addition to repair costs and the diminished value claim, you can recover for the loss of the use of your car. The loss of use is measured by the cost of renting a replacement of a similar make and model car. If your car is damaged, and in the shop for two weeks, your claim is for two week of loss of use. If your car is a total loss, you are entitled to loss of use for the time it takes the insurer to appraise your car and calculate its fair market value.
Insurance companies will often authorize a rental car immediately upon opening a claim, but does not have to. This is one way adjusters will keep an injured person away from an attorney.
You may have an extra car in your household, and not really need a rental. Even if you do not actually use a rental car, you still have a claim for loss of use, and that claim is the cost of renting a similar vehicle during the time it takes to replace or repair your car.
Insurers may dispute that the cost of insuring a rental car is not included in the loss of use claim, so if you rent a car while your car is in the shop, make sure you know what the insurance company is willing to cover when it authorizes a rental.
When the claim involves a total loss, the insurance company may make an offer on the car's fair market value in a “take it or leave it” kind of way, and cut off the rental car immediately after making the offer. Some companies will allow a reasonable extension on a rental so you can find and purchase another car. If you suspect that your car is a total loss, you may want to consider looking for a replacement car early in the process to avoid any problems with the rental car.
The One Bite of the Apple Rule
Oregon law used to allow the property damage claim to proceed in court separately from the injury claim. This put the insurance company at a bit of a disadvantage for a few reasons. First, it would have to possibly defend two separate claims in court. Also, depending on the amount in dispute, the insurance company may not only have to pay the property damage claim, but attorney fees if the case ended up going to trial.
The current law is different. Now, filing a claim in court requires that all claims arising from the collision must be included in the court filing. This means that the property damage and injury claims must be filed in the same lawsuit. You get one bite of the apple.
You may still be able to resolve one claim, and file the other in court. Most cases we see involve a property damage claim that is resolved by settlement. The remaining personal injury claim may move forward in a court case. Another possibility is to resolve the personal injury case, and then pursue the property damage claim in court. This does not happen often, but because you have six years from the date of a collision to bring your property damage claim, and only two years to file your injury claim, it is a possibility.
If you are dealing with an Oregon or Washington auto collision injury claim, contact us with your questions. We can help you know your options.