Wow, Allstate Delivered

I have seen several households benefit from the determination that fixing their vehicle was just not an option — based on the total loss formula each carrier has to follow under the Total Loss Formula for Washington and many other states.

In Washington State, a vehicle is considered a total loss when the cost of repairs, plus the salvage value, exceeds the vehicle's actual cash value (ACV). This formula is governed by WAC 284-30-320(18).

That means, after the following — as retrieved from a simple Google search:

Total Loss Formula: The formula is essentially: Repair Costs + Salvage Value ≥ ACV.

Factors beyond the formula: Other factors, such as biohazards or deaths resulting from the loss, may also be considered in reaching a total loss determination.

Salvage Value: This represents the value of the damaged vehicle if it's scrapped or sold for parts. CoParts is the organization my carrier has used as far back as I can recall in coming up with the values for salvage and eventually the ACV offered.

Actual Cash Value (ACV): This is the fair market value of the vehicle before the accident or damage. One should not confuse retail or the listed online price as ACV — they are not the same. ACV is almost always less.

Settlement Options: Insurers can settle total loss claims through replacement with a comparable vehicle or a cash settlement based on the ACV.

What if you had been given the option for a retail dollar amount? Would that change why you would select a carrier to protect you?

A Real Example

If a car's ACV is $9,500, repair costs are $5,800, and the salvage value is $3,900 — the $5,800 + $3,900 = $9,700 exceeds the $9,500 ACV, declaring it a total loss.

This month, one of my staff unfortunately tangled with a scooter of all things, which totaled her 2012 vehicle. The CoParts ACV was $6,351 — yet the insured received $9,580 after having elected the AUTO REPLACEMENT ENDORSEMENT. She paid an additional $4.83 per six months in premium for this feature.

The great news is Allstate still offers this feature for the first seven years of the model life of a vehicle. The better news is that after five years of offering this feature, most other carriers do not.

Price vs. Value

I like to comment that no one has ever asked for the cheapest surgeon — but in the world of insurance, consumers tend to let price dictate the majority of decisions made rather than the value of what they are actually buying. If all your grocery buying is not from the bottom shelf in every aisle, then you do find value to be a stronger consideration than just price.

See if the AUTO REPLACEMENT ENDORSEMENT is available to you — and tell your friends our last insured with it got 50.8% more as a result.

Thanks for reading, and drive safe.