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Old 01-10-2021, 05:26 AM   #1 (permalink)
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Maintaining a car and insurance fear.

So there's one thing that bothers me about auto insurance.

Say you're the kind of person who works on his/her car (which you probably do if you're an ecomodder.) There's a possibility that you may put in a considerable amount of money into an older vehicle. But if that vehicle gets in a wreck and say insurance is there to "cover" it, what can happen is the insurance company will simply say the car is totaled, hand you a check for a few hundred dollars and take the car.

I understand why it is that way, if the owner had a say in the worth of the car would allow for some major insurance fraud. But is there anything that can be done about not getting shorthanded?

Say I go replace my catalytic converter, HV battery and brake actuator on my 2006 Toyota Prius. That could run me nearly $6,000 in parts (and it is in need of a catalytic converter and the HV battery is not doing well either, so I need to nearly $4,000 in parts if I go OEM).

But if someone runs over my car (if they have insurance) or if a thief steals the catalytic converter (if I have full coverage) then I'm at the mercy of if the damage is less than the total value of the vehicle. And since KBB says the car's only worth $1,300 at a trade in, the likelihood of it being a total loss is very high. In other words, they'd give me a check for $1,300 (or whatever they calculate) and take the car I just poured a bunch of money into.

Of course I could just not put that kind of money into the car. There are aftermarket HV batteries for as little as $600 (that might last a year or so). And I could just not replace the cat or go with an aftermarket cat that costs a 10th the price but obviously isn't going to be built anywhere as well as the OEM cat.

Is there anything that can be done about this? Has anyone ever run into this problem?

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Old 01-10-2021, 09:53 AM   #2 (permalink)
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Insurance doesn't just flat out take your car. Rather they give you a payout, but you can immediately offer to give part of that back and keep the car. It's generally referred to as "buy back".

I have some slight concerns about my Insight, driving it on slick winter roads surrounded by SUVs and trucks. On paper it's an unpopular 20 year old 2 seat economy car with the better part of 300,000 miles, even if I've put very significant money into it with my modifications.

There are independent insurance companies, often used for modified or classic cars, which allow you to pick your own value. The rates go up proportionally.

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Old 01-10-2021, 10:57 AM   #3 (permalink)
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So you're happy to pay the premium based on it being a 15 year old Prius with a ton of miles, but you want the insurance company to pay out something higher because you've maintained it.

If you simply insure it like a regular car, you get market value for... a regular car of that year, mileage and condition. If you want to insure it at a higher value, you can deal with the insurance company, get it inspected to make your case for insuring it at a higher amount, and pay a higher rate. Generally not worth doing that unless it's a collectible.
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Old 01-10-2021, 11:35 AM   #4 (permalink)
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Quote:
Originally Posted by Ecky View Post
Insurance doesn't just flat out take your car. Rather they give you a payout, but you can immediately offer to give part of that back and keep the car. It's generally referred to as "buy back".
That's good to know. At least if it's someone else's fault with insurance then I could sell the parts I've put into the car.

But it wouldn't help if I did decide to get full coverage and either the car or the new part(s) I recently installed were stolen. For an example, there doesn't seem to be a catalytic converter insurance that would cover the loss of a brand new catalytic converter, which right now seems to be a very common theft on these Prii.

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I have some slight concerns about my Insight, driving it on slick winter roads surrounded by SUVs and trucks. On paper it's an unpopular 20 year old 2 seat economy car with the better part of $30,000 miles, even if I've put very significant money into it with my modifications.
Sounds like my point of view. SUV's have a higher probability of crashing into other cars.

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So you're happy to pay the premium based on it being a 15 year old Prius with a ton of miles, but you want the insurance company to pay out something higher because you've maintained it.
Did you mean insurance premium or maintenance premium?

What I'm saying is that I want to take good care of my car. But that involves money. Theoretically if I change out the HV battery, catalytic converter and brake actuator on my Prius with OEM parts the car should last another 15 years. And that would be around $6,000 just in parts.

The difference between that and buying a slightly newer Prius for $6,000 is that if I fix up the older Prius today it should last another 15 years. But if tomorrow it get's ran over by a Suburban I'm not going to be getting back anywhere near what I put into it.

But if I go buy a newer Prius worth $6,000 today it would be a lot closer to needing the repairs I've mentioned and so won't last as long without them. But if it gets ran over by a Suburban tomorrow then the insurance company would pay up to what I've put into the car.

Or what if I had an old 2011 or 2012 Nissan Leaf with a degraded battery. A new battery is like $8,000 anymore from Nissan. But these old Leafs are worth something like $3,000. Imagine if someone were to put that kind of money into one and soon after it caught on fire.

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There are independent insurance companies, often used for modified or classic cars, which allow you to pick your own value. The rates go up proportionally.
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Originally Posted by Fat Charlie View Post
If you simply insure it like a regular car, you get market value for... a regular car of that year, mileage and condition. If you want to insure it at a higher value, you can deal with the insurance company, get it inspected to make your case for insuring it at a higher amount, and pay a higher rate. Generally not worth doing that unless it's a collectible.
I've looked into those kinds of classic car insurances and the ones I've seen put a pretty low limit on how many miles you can drive the car per year. That wouldn't work for someone like me who can put as muchas 30,000 miles per year on one.

I don't mind paying more for insurance if it would cover my expenses that I've put into the car. But that doesn't seem like an option.

Conclusion
I guess what I'm saying is that before I was under the impression it was a good idea to keep my cars fixed up in tip top shape. But after thinking about it, I'm wondering if that's really a good idea or not. As long as we don't get into any accidents, then it should work out. But pouring a lot of money into a car could be a risk, unless the car is worth it on paper.

What made me think about this is I know a lady who crashed into an older vehicle. The older vehicle owner asked her to not go through her insurance, but if she'd just pay out of pocket for the repairs under the excuse that she'd not have to report it and have her insurance go up and such. But then I found out that the real reason is that he had put a substantial amount of money into restoring his car and was afraid that his car was supposedly worth only a few hundred dollars according to KBB or NADA guides and therefore the insurance company.
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Old 01-10-2021, 12:32 PM   #5 (permalink)
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Sadly, most insurance borders on being a scam, especially with it's government mandated. I tend to lean pretty left politically and I still feel this way. If a company didn't profit off of people a majority of the time, it wouldn't be a sustainable for-profit business. Even when one's vehicle IS damaged (with full coverage), it's often better to just not make a claim, because you pay for it in the long run through increased premiums.
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Old 01-10-2021, 02:44 PM   #6 (permalink)
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Supposedly, here, if you have receipts for all the work(or parts) you've done, they will reimburse you more. Considerably more, if you've put a lot in to it.

Hadn't thought about it, but I suppose that's one good thing about this insurance company having a monopoly...everything else about it sucks, hard. If it was a bunch of independent companies, I doubt they'd give you more than the book value, whatever you've done.

We can also claim the value of the vehicle to be...whatever. Like if I did a total restoration on something, I could claim it's worth $20k, rather than a few thousand. I'd simply end up paying more for the insured value.

Don't know how any of this helps you; just giving my perspective.
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Old 01-10-2021, 02:44 PM   #7 (permalink)
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When I spun out on black ice in the dark, I had to contend with my own insurance company to keep a clear title. They offered IIRC $1500 and eventually cut a check for $5500. What finally made the difference was my pointing out that they set the bar at 80% of assessed value, but I pointed out that in Oregon it's 90%.

The other thing that made the difference was a big ice storm back East.

It's always bothered me that if someone hits you car, their insurance company instantly assumes ownership and tries to sell it back to you.
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Old 01-10-2021, 03:16 PM   #8 (permalink)
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Sure, it's a scam, but if you can't afford to replace your car tomorrow out of your own pocket then it's a good deal.
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Old 01-10-2021, 04:25 PM   #9 (permalink)
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Sure, it's a scam, but if you can't afford to replace your car tomorrow out of your own pocket then it's a good deal.
A situation I hope to never be in.

I understand most Americans have less than $1000 to cover an emergency at any given time, but I'm personally uncomfortable if I don't have at least a year's living expenses in cash.
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Old 01-10-2021, 04:37 PM   #10 (permalink)
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Supposedly, here, if you have receipts for all the work(or parts) you've done, they will reimburse you more. Considerably more, if you've put a lot in to it.
That's nice to know. I wonder if that works in the States. Or do I need to get ahold of Frank Azar?

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A situation I hope to never be in.

I understand most Americans have less than $1000 to cover an emergency at any given time, but I'm personally uncomfortable if I don't have at least a year's living expenses in cash.
I try to keep three months worth. But that doesn't mean I want to save up, spend part on fixing up something of mine, have someone else wreck it or steal it, then spend the other part on fixing what they did to me especially when we're all paying mandatory insurance to supposedly cover all this.

And then there's the possibility of it happening soon afterwards too. Like when someone gets his or her $2,000 catalytic converter stolen then replaces it, then gets it stolen again.

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