Auto Insurance Issues

Is my vehicle covered for flood damage?

Only if you carry Other than Collision coverage, also called Comprehensive coverage, on your policy. This information can be found on your policy´s declarations page. If you do not have a copy of your policy, you may wish to check with your agent or company.

My car was flooded. How do I determine if my car should be totaled?

Whether your car will be totaled is determined on a case-by-case basis like any other loss.  Normally, when the cost of repair plus the salvage value equals or exceeds the actual cash value of the vehicle prior to the loss, it will be considered a total. A primary factor is the amount of water in your car. Generally, if water covered your dashboard or electrical components, the car will be totaled.


My car was totaled due to flood damage and I have full coverage on it. The company is going to pay the Blue Book (or JD Power and Associates) value but I still owe substantially more than that. Doesn’t the company have to pay what I owe on the auto?

No. The company is only obligated to pay the current market value of your vehicle. You can request that the adjuster explain to you how the value was derived to ensure that all of the vehicle´s equipment, features, upgrades and recent work was considered in determining the value. To cover the difference between the market value of your vehicle and what you actually owe (the retail price), you would need an endorsement or separate policy, to provide Guaranteed Auto Protection (GAP) coverage.

What will happen to the vehicle´s title if my car is totaled?

If you own the vehicle outright, you will have to sign the title over to the insurance company.  In exchange, they will give you a check for the market value of the vehicle. If you still owe on a car loan, the insurance company will coordinate with you and your lender to have the title signed over to them. In most cases, the insurance company will establish contact with the lender and be advised of the amount owed on the loan. If the insurance company has determined that the market value of the vehicle is $10,000 and the amount owed the lender is $8,000, the insurance company will issue a check for $8,000 to the lender to release the lien on the car. The insurance company will then issue a $2,000 check to you to obtain your signature on the title.


The insurance company requested that I tow my flooded vehicle to a specific location for inspection. Am I responsible for the towing charges?

No. The insurance company should pay the towing expense by reimbursing you or paying the tow truck operator once the vehicle is delivered at the inspection site. You should not be responsible for the expense since you are assisting the insurance company in a prompt inspection of your vehicle, as well as protecting it from further damage.  It will depend on whether you have comprehensive coverage, or if your deductible has been met.  If you only have liability coverage, there is no coverage for towing the vehicle regardless of the circumstances in which it was damaged.


The insurance company agreed to repair my vehicle. Can the company require the use of used parts?

In some cases, used parts and after market parts may be permissible, depending on the age, condition, and mileage of the particular vehicle. Most Colorado personal automobile policies require the insurance company to pay the lesser of the following: actual cash value of the property; the amount to repair or replace the property with other of like, kind, and quality; or the amount stated in the declarations page of the policy.

Since my car was flooded, I had to rent a vehicle. Does my auto policy cover the cost of renting a car?

Your policy will provide coverage for renting another vehicle only if you have an endorsement on your policy for Rental Reimbursement Coverage. Under this coverage, the insurance company will pay up to the limit shown on the endorsement for the reasonable amount of time it takes to repair or replace your vehicle.


What if I do not agree with the settlement offered by the insurance company, particularly the market value amount for my totaled vehicle?

Ask the adjuster to explain how the settlement amount was derived. If you still disagree, the Personal Auto Policy allows you to demand an appraisal of the loss. There is a specific provision in the policy for appraisal which lists the responsibility of both parties.

I´ve received a check from the insurance company, but am not satisfied with the amount. I plan to file a complaint to request additional funds be paid. Should I cash the check? If I cash the check, does it mean that I accept their decision and amount of payment?

Be careful about endorsing a check before discussing your concerns with the company. Call the adjuster or company first before cashing the check. Some companies have a release from further liability disclaimer printed on the back of the check.

How does replacement cost coverage work?

Replacement cost coverage replaces or repairs your damaged property with new material and/or items of like kind and quality.