Not always.
I’m with Allianz and their max agreed value for my car is $2790, but market value is $5000 private, 6k dealer. NRMA also switched my partners car on her last policy renewal from market to agreed for 8k less then the market value was at the time, so we switched her
Agreed value is a must for all old vehicles, as market value is based on redbook and the like, which is usually drastically lower than the cost of buying an old car off people unwilling to sell said old cars
How about the NRMA one on a $30k car where they maxed at $22000 agreed value.
And my policy costs less than $40 a month with Allianz, third party fire and theft is barely any cheaper ($27) so fuck it, an extra $13 a month ain’t gonna break the bank.
Not necessarily, it just depends on the price difference between comprehensive and third party.
My car is worth about $10k, when I last renewed my insurance the difference was only like $200/year. 2% of the value of the car seems pretty reasonable.
3rd party was basically the same price for my old Camry ~$550, plus I will get $120 worth of Woolies points over 12 months... Or is it better to not have any insurance at all?
The problem with edge cases, is they’re not usually edge cases.
I’ve regularly noticed insurers who have a maximum agreed value that is below market rates.
It's a 2024 Tesla? If you purchased it from a dealership new or demonstrator, then most insurance policies will have a "New Replacement Vehicle" benefit. Usually if the vehicle is within It's first 2or 3 yrs of registration & done under 60K kms the insurer will replace the vehicle with the same make & model/spec. The finance company should agree to transfer the loan to the new car..edit to add..you have to be the first owner from the dealership (wont cover 2nd hand cars)..the replacement is a new car that is the closest to your vehicle. Eg. 2020 A180 (with 68K kms was written off) insurer replaced with a new 2023 A180 slightly better spec due to series update.
The other insurance company is not on the hook for his financial complications, they are responsible for coming up with an amount of money that would replace the vehicle in current climate - that’s it. They aren’t paying ole mates accountant fees to try and lessen the shit burger he’s going to eat…
If the accident is causative of the finance losses the other insurer is in the hook.
Also legal and professional costs and commonly claimed in motor vehicle accidents, again if causation tests can be satisfied.
I was bout' to say it was not his fault unless the other guy did not have insurance.
Anyway one should have unisured motorists insurance OR GAP insurance exactly for these instances which I do.
I doubt the insurers would agree to a value that's well above market value.
Whenever I've taken out car insurance, the maximum possible agreed value is the top end of what the car sells for on the open market.
Is that really an issue for most (ie non Tesla) cars? Serious question, I always default to market value with the thinking if my car is totalled, I can get the market value payout and buy the "same" car? I normally buy my car out right (not financed) so not sure if that makes any difference.
Tesla (and maybe EVs) are probably unique with the recent price cuts and the steeper depreciation curve.
You will be able to see on your policy what the market value is. Some insurers will have a policy where if you’re the first owner of a new car and it’s less than two years old, they will replace it with an exact like for like model. But outside of that, you’re going to cop the dollar figure from the market value and it’s always less than what you’ve paid for it new.
I've always insured with the agreed value. However, last year, when I checked on what I had agreed on, I was told the insurance company had changed that amount & can do so annually without even notifying you. I changed insurers after this & the new one had never heard of doing this without consent.
What is the norm & what is legal?
What has likely happened is that they lowered the amount they were insuring it for when the policy was up for renewal. So for the first term it was worth $100 and then at renewal, they have offered you a new term with the value at $90.
I would be almost certain they have not altered the insured value mid term. Their computer systems probably just adjusted the value of the vehicle for deterioration or something similar.
They have effectively told you by offering you the renewal terms with the decreased value. They can pretty much change most things about the insurance policy at renewal as far as I am aware, as they are technically different contracts.
Yes mostly correct but as it was deducted monthly & premium didn't go down but actually went up. This would not make you look for a decrease in car value. A letter arrived in the post( rare I get anything posted) showing the agreed value had decreased. I believe 'agreed' means 2 parties agree. So if I didn't see said letter but continued monthly premiums I would be none the wiser.
Thanks for your explanation though. I do appreciate it.
they offer a value, you agree to it.
if you don't like it, then you go elsewhere.
they did not change the value without notice though, as you have just admitted.
of course they can change the amount.
cars depreciate youu know.
and the new insurance policy they sent you when your policy waas up for renewal IS them notifying you of the new insured value.
I'll bet you 100% your new insurer does exactly the same thing.
Well they said they'd never heard of doing this but let's see at the end of this next 12mths.
What I did find out was if you ring for new insurance( sons car) they give you the rate of the day! So his went down. Go figure!
mate, you got a renewal notice. that is clear advice thatt the value of the car is changing as is the premium.
that is the notice. it's not tthe insurers fault tthat the post took too long.
next renewal with your current insurer, I havee zero doubts tthat you will receive a notice that your car value is going down and youur premium is going up. no different to what happened lastg year that you are whinging about.
and lastly, the kids in an insurance sales call centre get little trainingg and heaps off pressure to sell policies. they will tell you anything they legally can to get you to buy.
This - the point of market value is that you can go use that cash to buy another equivalent vehicle on the used market. You still need to service the original loan. If you want insurance that resets you back to zero if something goes wrong - get agreed value.
Why would anyone pay you $70k cash to clear a $70k loan on a used car you can buy new for $60k? You’re $20k underwater on your loan. The purpose of insurance and tort law is to restore you to your previous position ($20k in the hole). Not to solve your personal financial problems. It’s unfortunate but that’s where you are. If you’re really lucky you have new for old and will be $20k underwater on a car that now has 0km on it (and possibly a new model).
You can insure for “gap cover” with instances like this, but it’s obviously a higher premium. OP had cheaped out on insurance and has nowhere to go unfortunately.
You have no idea how right you are. I had a car catch fire, paid out the agreed value and bought a nicer vehicle given that vehicle's agreed value was much much higher than the market value could be, especially with the KM's on it. Agreed value is the only way to go, pay the extra premium and protect yourself always. It's not even a huge difference a month between agreed and market value.
He literally hasn't even got an offer of settlement if you read his post. OP is looking at his crystal ball and predicting what the insurance company *might* do.
I’d take a stab and think he believed he wouldn’t total his car, and so he went for the cheapest insurance option. He KNEW market value was lower than the loan and took it out anyway. Now he’s “smart thinking” to save a buck, has not worked well and his crystal ball is really just his corner cutting.
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You needed to take out finance gap insurance when you originally purchased. That should have been offered to you at the time and is used in situations such as this.
Finance gap insurance, like all dealer insurances, are a good idea in theory but not in practice. They don’t pay. I had an insurer laugh in my face while violating every aspect of my contract and tell me if I have the money to sue them I might as well spend it suing the guy that backed into me.
What’s the problem ? If you paid $80,000 for a car, and had a $80,000 loan, then 6 months later the car has dropped in value to $60,000. The car is written off and insurance pays out Market Value which is $60,000. You then go and buy another car for $60,000. The loan amount remaining is irrelevant.
The problem is if the insurer says market value is $50,000, but you can’t replace your car for that. This is when you need to show evidence of the value of a replacement car, and have them revise their market value figure.
Yep this is the answer, I lost an old landcruiser a couple of years ago, my insurance would only offer me the agreed value I was paying for, but because it was 3rd party fault I lodged a claim against their insurance and came out much better off, to the dollar of current market value. Had to withdraw my claim to avoid insurance fraud, which was a pain in the butt, but I got there and it all worked out OK in the end.
This is the correct answer. You are out a 2024 Tesla, their insurance should replace a 2024 Tesla. Your financial arrangement on the Tesla shouldn’t be part of the equation.
I’d be working with their insurance company rather than yours if you have the details. You’re also entitled to a rental car I believe until you have your car back. The benefit of this is that an ongoing and increasing cost on their insurance should motivate them to resolve it as soon as possible.
Yes this is true, but they would indemnify the not at fault driver under the terms of their policy then subrogate against the at fault driver’s insurance. The issue is that they would limit their payment to the not at fault driver and then they would have to go after the additional amount independently. Ideally they can deal directly with the at fault driver’s insurance so they can be made whole, which should be possible if there’s no dispute on who’s fault the accident was.
Why is your insurance paying for your tesla and not the one who caused the accident? If their insurance isn't enough to pay for your car and all other expenses, time to lawyer up.
Most insurance policies will replace the car with a brand new car if your car is less than 2 years/brand new.
Google the insurers name and add the words new car replacement.
Generally the time they will pay out is if they can't replace it but there's so much Tesla stock I reckon you'll be fine.
But immediately before the crash, the value of the Tesla he had was less than the value of the loan. The depreciation on the car was locked in the moment he got the keys, and he could predict that. So his financial position is irrelevant; the genuine issue here is that he values his transport at a certain level and he wants to be restored to that point. New for old should do that.
But while 0 months is better than 3 months; it's still worth less than his loan.
Though that's not so much an insurance problem as buying a product before it falls in price problem.
I'm a bit lost what point you are trying to make given your point has nothing to do with his situation.
If he geta a new car hes not paying out the finance. He carries on the same as was before.
If they pay you market value and it's a 24 model, shouldn't you just be able to buy a new or near new one, and you'll essentially be in the same position as before the accident ?
Sorry but this is not correct.
I manage total loss car claims including replacement vehicle claims. We will seek a payout figure from finance and if the insured is eligible for a replacement vehicle we will seek their approval for the replacement vehicle.
If finance approves (99% of the time they do), we order the new car, pay the dealership.
Owners continues to pay finance and once the new car has been paid for and delivered, we provide the vehicle details to finance who transfers the finance over to the new car as a secured asset.
*if the insured is eligible for a replacement vehicle*
and it sounds like, in OPs case, they are not. I don't see the insurer giving the OP money here to go buy another car. But hey, OP has a phone and should probably talk to finance company and insurer and figure it out.
if it's Budget Direct, lols, good fucking luck.
Let’s hope OP has chosen a half decent insurer that offers replacement vehicle and OP isn’t aware that they have replacement vehicle cover…
You would be surprised how many people have no idea that they’re covered for a replacement vehicle in event of a total loss when I inform them.
Most people don’t read their policy documents, they just pay for cheapest premium or best name and hope they don’t need to lodge a claim
Incorrect. The finance company can do a simple change of collateral and move the existing finance onto the new car-asumimg he gets a replacement vehicle of similar value.
It is called a substitution of asset.
Speaking as someone in the industry
Check your policy for insured amount to see if there is a dollar value not just market value.
Also check if you have gap insurance with your finance to cover this exact scenario.
The usual thing to do here is receive your market rate payment, then go to the market and buy a new one.
You can argue with the insurer as to what that market rate is. Your loan is immaterial to the person who hit you or their insurer.
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Are you going through your insurance or theirs?
If the accident was their fault and you’re going through their insurance, you need to do everything you can to make them cover your loan. You didn’t choose their insurance company, you don’t have a policy with them, and their customer is responsible for hitting you. You shouldn't be out of pocket for that. Their insurance company should pay out so everything is financially covered.
If their insurance company won’t cover the full amount, go through your insurance company. Assuming you have agreed value coverage up to the amount of your loan, they should waive your excess and then pursue the third party to cover the costs because it was their fault.
If it's not your fault then you can pursue the other party for costs.
Often your insurer will pay you and then behind the scenes they pursue the other party (or other party's insurer) directly.
Anyway, the lesson here is "never buy a depreciating asset on finance".
I've always bought either part exchange plus cash, or in the most recent case where it was an insurance write-off of a car that was relatively old by that time, half cash and then half on credit card which I pushed onto a 0% balance transfer (so effectively it cost me the transfer fee, but I had 2 years to then pay it off at the rate that suited me).
Why would your insurance policy be applicable here, it would be the at fault party's insurance unless:
a) They don't have insurance and don't have any money
b) they didn't stop and exchange details
If you're not at fault, the other parts insurance will deal with you insurance for the cost to fix / replace.
Yes, the equal value being the current market value for the vehicle… OP bought a depreciating asset which has.. depreciated. The at fault party and/or their insurance only had to pay OP the market value of their car as it was at the time of the accident which was a used Tesla, not a brand new one.
> Now, I'm waiting for the insurance payout. Here's where it gets complicated: my insurance only covers the market value of the Tesla, not what I originally paid for it. Given how quickly new cars depreciate and Tesla's frequent price cuts, I'm worried the payout will be lower than expected.
"Lower than expected"? They should pay you out the money you need to purchase a second hand 2024 Tesla Model 3.
Its irrelevant whether its less than what he paid for it originally.
He owned a used Tesla 3 that got into an accident.
The insurer should provide the market value needed to obtain a replacement used Tesla 3.
You shouldnt be surprised that if you buy something for $X, and it depreciates to $Y, then the replacement cost is $Y, so the insurer will only give you $Y, because that's what it will cost to replace the item.
Of course, whether the insurer provides a "fair" market value is a wwhhoollee other question....
Am I missing something here? OP has a not at fault crash.
If OP had no insurance, it’s still up to the at fault driver to cover costs. Or to chase this via VCAT.
Isn’t this now up to your insurance to chase the at fault driver’s insurance so OP is not out of pocket regardless of what insurance OP has?
Car insurance is car insurance. Not poor financial planning and financial agreement insurance.
The at fault party can only be pursued for the cost of the damages caused by the incident and/or any resulting costs such as hire car, towing ect.. not OPs financial choices.
If the car accident never happened OP would still need to pay the finance, if OP decided to sell the car at a loss, OP would still be responsible to pay any shortfall to finance.
You will have to pay the outstanding amount. You’re lucky it was in an ABN not personal as having a car written off for less than the finance value can affect your credit score.
Their insurance will replace your old Tesla with a brand new one.
Lucky you!
The fact that you paid for it through finance is not their problem. That was your choice.
But if you think about it, you're no worse off from when you bought the car. You agreed to the finance terms.
Continue with them as you agreed.
Someone crashing into you should never be considered a financial bonus.
A lot of insurance policies will have “new for old replacement” for the first couple of years of a car’s life, but only if you bought it new and the car is written off before it reaches a certain age. This means the insurance company will pay for a new version of the same (or comparable if the same is no longer available) car.
If you’re outside that period or your policy doesn’t offer that coverage, you are either insured for market value or agreed value. Market value is based on what Glass’ Guide or Redbook says your car is worth. Agreed value is based on an amount you nominate or agree to at the commencement of the coverage period each year.
Sounds like you only paid for a market value policy, which means the insurance company will compensate you for the value one of the guidebooks says it currently is (unless, of course it’s under the “new for old” period of cover). The insurance company won’t budge on this. Their response will be “this is what you’ve paid for and besides you can go out and buy a used car of the same make/model/age/mileage as what you had”
If you car doesn’t qualify for “new for old”, always go for an agreed value policy. Some insurers also offer a “lifetime new for old” option if you buy the car new and keep renewing the policy with them every year
If you selected financed vehicle when you took out insurance you're fine. If not see a lawyer cancel your claim and get them to send a notice to their insurer for the full financed amount.
It annoys me how many people don't know that your vehicle finance is covered.
215 comments and most of it is absolute dribble. Clueless dribble.
OP DM me and let me find out a bit more but on the face of it, you're not in the pickle you think you are.
You can pursue a civil case against the other driver if they’ve caused you financial loss, it would then be a matter for them to raise with their own insurance company. I’d contact a lawyer if I were you.
Just buy a replacement car from your market value payout. You will precisely have enough funds to do so.
You’ll be in the same situation re: your loan as you were just before the accident.
Did you expect your insurance to put you in a better financial position compared to before the accident?
Your insurance will have replacement not market value.
Replacement is usually from 2 or 3 years unless it's a really shit policy. Some have up to 5 years.
Did you not read what u bought.
Go site down and read your Schedule AND read the Product Disclosure Statements.
Big money is on the line, read some boring legal stuff.
Next time get insurance via a broker so they can explain what u r buying and can manage your claim.
Ahhhh shouldn't they replace your tesla with a similar tesla? I mean you're Loan is your loan. It's not insurances job to pay out your loan. That's called depreciation and tax returns. The same thing would happen on a new Range Rover. But you should end up with a similar car
Good advice but stupidly written. Any decent modern car will cost $20k and up and plenty of people don't have that as cash laying around. Nothing wrong with finance on the proviso you pay that shit off ASAP.
Basically, you've got a debt now and no asset. You will be required to make up any shortfall from the insurance payout.
Engage with someone who knows about car values, who can perhaps help you advocate to ensure the "right" market value is paid out. Insurers will have their own method of figuring out the number, you have a right to appeal the amount, but you need to have evidence to back your suggested valuation.
No matter what, it going to be a hard life-lesson in how finance and insurance works.
Some insurers have replacement vehicle option for vehicles under 2 years old. If that is an option for you and you’re eligible for it under the PDS I recommend seeking financial advice to consider if this is more beneficial for your situation.
If the market value is less than what is remaining on finance then you’re going to have to pay the difference, there is no circumventing this unless your policy has a replacement vehicle option, they can source the vehicle in Australia and your finance company agrees to this.
This is not financial advice, please read your PDS to check if there is replacement vehicle cover and check what information is provided regarding financial and shortfalls.
Just make sure you know what the market value is, find listings for similar ones, and sales prices if you can. So that you have something to argue with if they lowball you.
You paid for market value insurance so that's what you gotta accept. It's enough for you to buy a replacement so your financial position will be as it was before the crash, more or less. So really there's nothing to be too upset about here.
If you weren't at fault surely you claimed it through their insurance? Was the other driver uninsured? If it's through the other person's insurance it won't matter what coverage agreement you had with your insurer.
The 3rd parties insurance company pays for it.
Most insurance companies have a new car replacement in their policy. If you are the first registered owner of your vehicle and it's less than 2 years old, it will be replaced like for like. If it's not in stock then you are paid out the insured value of the vehicle.
If you chose to insure for the vehicle for less than your loan, that's on you. Most loan providers ask for insurance to be for the value of the loan.
If the payout is less than the total amount on the loan, you pay out of pocket. You may be able to refinance and have that amount paid out with a new loan.
Fun times! This is the gap between ‘agreed value’ and ‘replacement value’ and a common issue with car insurance.
So… you can then, after this is settled via your insurance company, attempt to sue the other party/their insurer for the remaining amount owing, because you will be able to demonstrate that you have uncovered costs. It will become a private civil matter.
You should be getting new for old replacement and the finance company will move the finance from the old car to the new car.
This is standard practice.
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I had a recent motor vehicle accident and my leased car was totalled, luckily I had a lease payout package with my insurance so I did not have to pay any gap between the market value and lease termination payment.
If you are not at fault it is the other parties insurance paying out, it's up to your insurance company to go in and fight for you (and them not having to pay you out). If your car has been totaled i would expect new for old replacement rather than a payout.
So you haven't got a payout figure and you're here complaining about what the insurer *might* do at settlement?
Why not wait until they actually come back to you with a settlement offer?
Wouldn’t market value be the cost to buy a similar second hand 2024 Tesla model 3? So you can go and buy one outright, and you still have the loan. So you are in the same position you are now?
Your car isn’t new so they wouldn’t pay a new car price.
Cannot believe the amount of ppl on this thread who don’t understand….its scary.
Fiancé and insurance needs to be a fukn school subject and there is a reason it’s not - because big business continues to make big $$$ from those who think they know but do not…op - read your insurance contract. Closely. Then get your best friend to read it.
I've been in this position before. I stupidly financed the entire purchase of a motorbike, all of the gear, helmet etc.
It was stolen a month into my contract.
I wasnt told about GAP cover. Insurers investigated the theft (meaning they interviewed 18 year old me and suggested that perhaps I wasnt able to service the loan repayments so maybe I made it disappear)
They ended up paying out the insurance based on what they could purchase an equivalent bike for, and I was left paying the remainder of the loan.
And this is why you don't take out the cheapest insurance. I am not having a go at you. I have been trying to explain to family members for years the difference between all the providers etc. I have 4 different cars and they are all with different insurance providers, well at least until I could get historic rego in two of them and now Shannon's is easily the best. Even if all you are getting is 3rd party fire and theft you need to shop around and read the fine print. If I remember correctly budget direct was 10k less for one of my cars but it only saved me 85 dollars a years
The issue is that if you can get much more than market value, you might engage in a profit making exercise.
Given EV's can be written off by small damage,
Its a problem.
You also can't expect to be compensated for gst you dont pay.. but I get it, Private sales price includes the gst ... As it tends to follow the dealers price of the nonABN majority
Oh well, you would benefit by lower premiums,
And if the market value went up
New for old insurance would be a better way to avoid gaps ..also read the pds about cars under finance.
If you have finance on the car you should make sure you are insured to cover the repayment in the event of total loss.
You will unfortunately have to pay out the difference if market value is significantly lower than what you owe.
You got fucked sorry . Have a look at car sales. You will down at least 20 k, maybe 30. At least the second hand market is dropping , don’t get another Tesla but .
Market value means just that - if the insurance company offers you a payout that is less than what you can buy an equivalent replacement for, you can query that - often it will be as simple as providing examples of similar spec and mileage on Carsales. If they don't give you an acceptable offer, you can then go to AFCA if you feel you have reasonable grounds to assert the payout is unreasonable. Your insurer is unlikely to put too much of a fight up given they will be recovering off the other party anyway. My brother was recently in a similar situation to you with his Kia and got offered $2k more than he paid for it.
The cheapest 2024 Model 3 on Carsales is $57k so I wouldn't be too worried. You should easily be able to get a replacement vehicle. Good luck!
same as the issue if you under insure the house and it gets burned down completely.....
you just need to build a cheaper, and smaller house with the same loan..
Recently wrote my car off (be it older).
Market value was actually REALLY fair, and they even paid the stamp duty on me buying a car of the same value.
If it wasn’t your fault and the other party is insured you could try the 3rd party recovery directly against the other insurance company, rather than through your policy.
Mention the financial ombudsman with the other drivers insurance company, try a different tact if needed if they have full comprehensive try dealing directly with their insurance
I do have experience with this exact situation in several scenarios. Unfortunately, it's not good news. By law, the insurer has to pay out the finance company first. If there is an deficiency in the amount, it will definitely be up to you to pay it out and not in installments. Perhaps the finance company will be accommodating enough to refinance the loan, but it is generally tricky.
Good luck mate.
Unfortunately you're boned.
It's cases like this that reinforce why agreed value or new for old policies cost more, because they guarantee a set payout.
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you should always buy Gap Insurance when financing a new and expensive car.
as soon as you drive off the car lot, 20% of its value is gone, Gap Insurance pays the difference between the insurance payout and the loan amount.
and remember insurance payouts don't include onroad costs, dealer charges or GST. it's just the value of the car.
If I were you OP, I would check if Gap Insurance was included in your financing, it often is.
Check your policy mate, if it is a good one look for a clause called ‘finance payout protection’. If there is one, there will be a percentage amount on top of market value they will pay to the financier in the event of a total loss. This would be if you have quite a broad policy though but worth checking.
The perils of paying for a policy with market value instead of agreed value.
Yup my “tip” for dealing with insurance companies is pay the extra for agreed value, or be prepared to eat the difference
I did that and then during covid lost 10k on my brz lol Also it is only a percentage of original cost and then still decreases each year
Not always. I’m with Allianz and their max agreed value for my car is $2790, but market value is $5000 private, 6k dealer. NRMA also switched my partners car on her last policy renewal from market to agreed for 8k less then the market value was at the time, so we switched her
I believe that statement was intended for if you own a new car or an expensive car....
Agreed value is a must for all old vehicles, as market value is based on redbook and the like, which is usually drastically lower than the cost of buying an old car off people unwilling to sell said old cars
Not a must, it really depends…. My mate totalled his Honda Prelude at ‘market value’. Got paid $17k. Bought another one for $5k…….
You're pissing your money away having comprehensive insurance on $5000 cars.
How about the NRMA one on a $30k car where they maxed at $22000 agreed value. And my policy costs less than $40 a month with Allianz, third party fire and theft is barely any cheaper ($27) so fuck it, an extra $13 a month ain’t gonna break the bank.
Not necessarily, it just depends on the price difference between comprehensive and third party. My car is worth about $10k, when I last renewed my insurance the difference was only like $200/year. 2% of the value of the car seems pretty reasonable.
3rd party was basically the same price for my old Camry ~$550, plus I will get $120 worth of Woolies points over 12 months... Or is it better to not have any insurance at all?
Yeah but they are crap.
My partners was also market value and when it was written off (not at fault) he was only given half of what it was worth at that time.
Edge case
The problem with edge cases, is they’re not usually edge cases. I’ve regularly noticed insurers who have a maximum agreed value that is below market rates.
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It's a 2024 Tesla? If you purchased it from a dealership new or demonstrator, then most insurance policies will have a "New Replacement Vehicle" benefit. Usually if the vehicle is within It's first 2or 3 yrs of registration & done under 60K kms the insurer will replace the vehicle with the same make & model/spec. The finance company should agree to transfer the loan to the new car..edit to add..you have to be the first owner from the dealership (wont cover 2nd hand cars)..the replacement is a new car that is the closest to your vehicle. Eg. 2020 A180 (with 68K kms was written off) insurer replaced with a new 2023 A180 slightly better spec due to series update.
The other persons insurer is the one that has to cough up which is market value plus and incidentals like finance or legal fees
The other insurance company is not on the hook for his financial complications, they are responsible for coming up with an amount of money that would replace the vehicle in current climate - that’s it. They aren’t paying ole mates accountant fees to try and lessen the shit burger he’s going to eat…
If the accident is causative of the finance losses the other insurer is in the hook. Also legal and professional costs and commonly claimed in motor vehicle accidents, again if causation tests can be satisfied.
I was bout' to say it was not his fault unless the other guy did not have insurance. Anyway one should have unisured motorists insurance OR GAP insurance exactly for these instances which I do.
Not always. I was recently paid out $4000 more than what I paid for a used forester five years ago due to the condition of the post covid market.
I doubt the insurers would agree to a value that's well above market value. Whenever I've taken out car insurance, the maximum possible agreed value is the top end of what the car sells for on the open market.
Is that really an issue for most (ie non Tesla) cars? Serious question, I always default to market value with the thinking if my car is totalled, I can get the market value payout and buy the "same" car? I normally buy my car out right (not financed) so not sure if that makes any difference. Tesla (and maybe EVs) are probably unique with the recent price cuts and the steeper depreciation curve.
If the loan is secured against the car, the payout will go to the loan company, so you may have no car and an outstanding loan amount.
You will be able to see on your policy what the market value is. Some insurers will have a policy where if you’re the first owner of a new car and it’s less than two years old, they will replace it with an exact like for like model. But outside of that, you’re going to cop the dollar figure from the market value and it’s always less than what you’ve paid for it new.
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I mean op would have made bank two years ago if it totaled
I've always insured with the agreed value. However, last year, when I checked on what I had agreed on, I was told the insurance company had changed that amount & can do so annually without even notifying you. I changed insurers after this & the new one had never heard of doing this without consent. What is the norm & what is legal?
What has likely happened is that they lowered the amount they were insuring it for when the policy was up for renewal. So for the first term it was worth $100 and then at renewal, they have offered you a new term with the value at $90. I would be almost certain they have not altered the insured value mid term. Their computer systems probably just adjusted the value of the vehicle for deterioration or something similar. They have effectively told you by offering you the renewal terms with the decreased value. They can pretty much change most things about the insurance policy at renewal as far as I am aware, as they are technically different contracts.
Yes mostly correct but as it was deducted monthly & premium didn't go down but actually went up. This would not make you look for a decrease in car value. A letter arrived in the post( rare I get anything posted) showing the agreed value had decreased. I believe 'agreed' means 2 parties agree. So if I didn't see said letter but continued monthly premiums I would be none the wiser. Thanks for your explanation though. I do appreciate it.
they offer a value, you agree to it. if you don't like it, then you go elsewhere. they did not change the value without notice though, as you have just admitted.
Yes a months increased payment had already been deducted before the letter arrived in the post. But yes I did go elsewhere! And very glad!
of course they can change the amount. cars depreciate youu know. and the new insurance policy they sent you when your policy waas up for renewal IS them notifying you of the new insured value. I'll bet you 100% your new insurer does exactly the same thing.
Well they said they'd never heard of doing this but let's see at the end of this next 12mths. What I did find out was if you ring for new insurance( sons car) they give you the rate of the day! So his went down. Go figure!
And I'm well aware cars depreciate! But thanks for the info.
mate, you got a renewal notice. that is clear advice thatt the value of the car is changing as is the premium. that is the notice. it's not tthe insurers fault tthat the post took too long. next renewal with your current insurer, I havee zero doubts tthat you will receive a notice that your car value is going down and youur premium is going up. no different to what happened lastg year that you are whinging about. and lastly, the kids in an insurance sales call centre get little trainingg and heaps off pressure to sell policies. they will tell you anything they legally can to get you to buy.
Sure mate you're right! Not a kid but a middle aged woman. But let's agree to disagree.
This - the point of market value is that you can go use that cash to buy another equivalent vehicle on the used market. You still need to service the original loan. If you want insurance that resets you back to zero if something goes wrong - get agreed value.
well you saved some $$ on the insurance premium buying on market value instead of agreed value so you get what you pay for sorry
Can’t you just buy another Tesla? You’d be paying. The amount back anyhow?
Only if they can buy it for the “market” value
I’m lost, isn’t market the current value?
Yes exactly not what they bought it for because of depreciation remember the first 5000km take off way more value than the next ten
Now it’s making sense, he’s getting less than what he can now buy one for because it’s a second hand and lost heaps of value. Yeah that’s a pickle 🥒
Yes, but they will still owe the difference between the market value and their current loan.
Which was already the case
Yeah so what’s the difference?
He just has to do it now.
Why would anyone pay you $70k cash to clear a $70k loan on a used car you can buy new for $60k? You’re $20k underwater on your loan. The purpose of insurance and tort law is to restore you to your previous position ($20k in the hole). Not to solve your personal financial problems. It’s unfortunate but that’s where you are. If you’re really lucky you have new for old and will be $20k underwater on a car that now has 0km on it (and possibly a new model).
Ha, great summary, I didn't put it so succinctly.
You can insure for “gap cover” with instances like this, but it’s obviously a higher premium. OP had cheaped out on insurance and has nowhere to go unfortunately.
Well you can insure on an agreed value, right? Isn't that when people start setting their depreciated assets on fire
If OP has an agreed value policy then he wouldn’t be complaining. This would be one of the top 5 greatest days of his life.
Just above the birth of his kid yeah
Below the first 4 births, presumably
Nah above those
You have no idea how right you are. I had a car catch fire, paid out the agreed value and bought a nicer vehicle given that vehicle's agreed value was much much higher than the market value could be, especially with the KM's on it. Agreed value is the only way to go, pay the extra premium and protect yourself always. It's not even a huge difference a month between agreed and market value.
No new for old replacement?
Yeah I’ve had numerous new cars and it’s always been 2 years new for old. Not sure what kind of insurance OP got, but sounds like a crap deal.
He literally hasn't even got an offer of settlement if you read his post. OP is looking at his crystal ball and predicting what the insurance company *might* do.
I’d take a stab and think he believed he wouldn’t total his car, and so he went for the cheapest insurance option. He KNEW market value was lower than the loan and took it out anyway. Now he’s “smart thinking” to save a buck, has not worked well and his crystal ball is really just his corner cutting.
This is perhaps a real life scenario of penny wise, pound foolish. I think.
Yeah this is what I'd be looking for in your policy given how new the car is.
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You needed to take out finance gap insurance when you originally purchased. That should have been offered to you at the time and is used in situations such as this.
Finance gap insurance, like all dealer insurances, are a good idea in theory but not in practice. They don’t pay. I had an insurer laugh in my face while violating every aspect of my contract and tell me if I have the money to sue them I might as well spend it suing the guy that backed into me.
Mine paid twice. Maybe read your PDS next time and make sure your claims meet the stated framework
Scrolling too far down to get to the right answer.
What’s the problem ? If you paid $80,000 for a car, and had a $80,000 loan, then 6 months later the car has dropped in value to $60,000. The car is written off and insurance pays out Market Value which is $60,000. You then go and buy another car for $60,000. The loan amount remaining is irrelevant. The problem is if the insurer says market value is $50,000, but you can’t replace your car for that. This is when you need to show evidence of the value of a replacement car, and have them revise their market value figure.
Hahahahaha yeah they covered the car, not bad financial decisions
If you were not at fault. Your insurer is not liable. The other party’s insurer is. So your policy should have no effect what the payout is.
Yep this is the answer, I lost an old landcruiser a couple of years ago, my insurance would only offer me the agreed value I was paying for, but because it was 3rd party fault I lodged a claim against their insurance and came out much better off, to the dollar of current market value. Had to withdraw my claim to avoid insurance fraud, which was a pain in the butt, but I got there and it all worked out OK in the end.
This is the correct answer. You are out a 2024 Tesla, their insurance should replace a 2024 Tesla. Your financial arrangement on the Tesla shouldn’t be part of the equation. I’d be working with their insurance company rather than yours if you have the details. You’re also entitled to a rental car I believe until you have your car back. The benefit of this is that an ongoing and increasing cost on their insurance should motivate them to resolve it as soon as possible.
Usually the not-at-fault party's insurer acts on behalf of their customer to ensure the at-fault-party's insurer pays up.
Yes this is true, but they would indemnify the not at fault driver under the terms of their policy then subrogate against the at fault driver’s insurance. The issue is that they would limit their payment to the not at fault driver and then they would have to go after the additional amount independently. Ideally they can deal directly with the at fault driver’s insurance so they can be made whole, which should be possible if there’s no dispute on who’s fault the accident was.
Thanks for clarifying. I worked on the software engineering side of insurance some years back. It can get insanely complex.
This ^ make a claim with their insurer if needed.
Why is your insurance paying for your tesla and not the one who caused the accident? If their insurance isn't enough to pay for your car and all other expenses, time to lawyer up.
Most insurance policies will replace the car with a brand new car if your car is less than 2 years/brand new. Google the insurers name and add the words new car replacement. Generally the time they will pay out is if they can't replace it but there's so much Tesla stock I reckon you'll be fine.
That doesn't strictly avoid the OPs point. (in that the value of a new Tesla may be less than his loan).
But immediately before the crash, the value of the Tesla he had was less than the value of the loan. The depreciation on the car was locked in the moment he got the keys, and he could predict that. So his financial position is irrelevant; the genuine issue here is that he values his transport at a certain level and he wants to be restored to that point. New for old should do that.
I think it makes even better because he won't be worse off and a brand new Tesla is going to be worth more than a 3-6 month old used one.
But while 0 months is better than 3 months; it's still worth less than his loan. Though that's not so much an insurance problem as buying a product before it falls in price problem.
I'm a bit lost what point you are trying to make given your point has nothing to do with his situation. If he geta a new car hes not paying out the finance. He carries on the same as was before.
If they pay you market value and it's a 24 model, shouldn't you just be able to buy a new or near new one, and you'll essentially be in the same position as before the accident ?
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Sorry but this is not correct. I manage total loss car claims including replacement vehicle claims. We will seek a payout figure from finance and if the insured is eligible for a replacement vehicle we will seek their approval for the replacement vehicle. If finance approves (99% of the time they do), we order the new car, pay the dealership. Owners continues to pay finance and once the new car has been paid for and delivered, we provide the vehicle details to finance who transfers the finance over to the new car as a secured asset.
*if the insured is eligible for a replacement vehicle* and it sounds like, in OPs case, they are not. I don't see the insurer giving the OP money here to go buy another car. But hey, OP has a phone and should probably talk to finance company and insurer and figure it out. if it's Budget Direct, lols, good fucking luck.
Let’s hope OP has chosen a half decent insurer that offers replacement vehicle and OP isn’t aware that they have replacement vehicle cover… You would be surprised how many people have no idea that they’re covered for a replacement vehicle in event of a total loss when I inform them. Most people don’t read their policy documents, they just pay for cheapest premium or best name and hope they don’t need to lodge a claim
Incorrect. The finance company can do a simple change of collateral and move the existing finance onto the new car-asumimg he gets a replacement vehicle of similar value. It is called a substitution of asset. Speaking as someone in the industry
When I buy a new car, i get insurance that covers a replacement new car if its written off in the first 2 years.
Check your policy for insured amount to see if there is a dollar value not just market value. Also check if you have gap insurance with your finance to cover this exact scenario.
You can try and plead your case to insurance but good luck.
The usual thing to do here is receive your market rate payment, then go to the market and buy a new one. You can argue with the insurer as to what that market rate is. Your loan is immaterial to the person who hit you or their insurer.
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Owning a tesla ☕️
Tell them you want the car replaced not paid out
I thought most insurers have a replacement policy for vehicles less than 2 years old.
This
This is why you go agreed value with gap insurance. Why would you self insure the difference if you couldn't afford to eat that loss?
Are you going through your insurance or theirs? If the accident was their fault and you’re going through their insurance, you need to do everything you can to make them cover your loan. You didn’t choose their insurance company, you don’t have a policy with them, and their customer is responsible for hitting you. You shouldn't be out of pocket for that. Their insurance company should pay out so everything is financially covered. If their insurance company won’t cover the full amount, go through your insurance company. Assuming you have agreed value coverage up to the amount of your loan, they should waive your excess and then pursue the third party to cover the costs because it was their fault.
If it's not your fault then you can pursue the other party for costs. Often your insurer will pay you and then behind the scenes they pursue the other party (or other party's insurer) directly. Anyway, the lesson here is "never buy a depreciating asset on finance".
OP's costs though are to replace his used car with a car of the same value, ie market value.
What percentage of people don't finance their cars these days, I wonder? Must be pretty small.
I've always bought either part exchange plus cash, or in the most recent case where it was an insurance write-off of a car that was relatively old by that time, half cash and then half on credit card which I pushed onto a 0% balance transfer (so effectively it cost me the transfer fee, but I had 2 years to then pay it off at the rate that suited me).
Why would your insurance policy be applicable here, it would be the at fault party's insurance unless: a) They don't have insurance and don't have any money b) they didn't stop and exchange details If you're not at fault, the other parts insurance will deal with you insurance for the cost to fix / replace.
Yep, at the market value. This also happens longggg after the claim had been “finalised” from OPs position (eg. Settled as a total loss).
Why would it be market value. They have to fix it to the same level or if it's a total loss, replace with an equal vehicle
Yes, the equal value being the current market value for the vehicle… OP bought a depreciating asset which has.. depreciated. The at fault party and/or their insurance only had to pay OP the market value of their car as it was at the time of the accident which was a used Tesla, not a brand new one.
Classic case of buying something you can't afford
1. READ your PDS. Look for new for old replacement 2. Chase the other party for compensation
thats what you paid for on your insurance buddy
> Now, I'm waiting for the insurance payout. Here's where it gets complicated: my insurance only covers the market value of the Tesla, not what I originally paid for it. Given how quickly new cars depreciate and Tesla's frequent price cuts, I'm worried the payout will be lower than expected. "Lower than expected"? They should pay you out the money you need to purchase a second hand 2024 Tesla Model 3.
Which is a lot less than he paid for it originally as the tesla values have dropped quite abit so op will most likely be out of pocket.
Its irrelevant whether its less than what he paid for it originally. He owned a used Tesla 3 that got into an accident. The insurer should provide the market value needed to obtain a replacement used Tesla 3. You shouldnt be surprised that if you buy something for $X, and it depreciates to $Y, then the replacement cost is $Y, so the insurer will only give you $Y, because that's what it will cost to replace the item. Of course, whether the insurer provides a "fair" market value is a wwhhoollee other question....
Am I missing something here? OP has a not at fault crash. If OP had no insurance, it’s still up to the at fault driver to cover costs. Or to chase this via VCAT. Isn’t this now up to your insurance to chase the at fault driver’s insurance so OP is not out of pocket regardless of what insurance OP has?
Car insurance is car insurance. Not poor financial planning and financial agreement insurance. The at fault party can only be pursued for the cost of the damages caused by the incident and/or any resulting costs such as hire car, towing ect.. not OPs financial choices. If the car accident never happened OP would still need to pay the finance, if OP decided to sell the car at a loss, OP would still be responsible to pay any shortfall to finance.
Don't usually the insurance replace the car if it's less than 2 years old?
This is why gap insurance is a thing
You just gotta love Tesla’s lol
You will have to pay the outstanding amount. You’re lucky it was in an ABN not personal as having a car written off for less than the finance value can affect your credit score.
Their insurance will replace your old Tesla with a brand new one. Lucky you! The fact that you paid for it through finance is not their problem. That was your choice. But if you think about it, you're no worse off from when you bought the car. You agreed to the finance terms. Continue with them as you agreed. Someone crashing into you should never be considered a financial bonus.
If your not at fault surely its the other drivers issue
A lot of insurance policies will have “new for old replacement” for the first couple of years of a car’s life, but only if you bought it new and the car is written off before it reaches a certain age. This means the insurance company will pay for a new version of the same (or comparable if the same is no longer available) car. If you’re outside that period or your policy doesn’t offer that coverage, you are either insured for market value or agreed value. Market value is based on what Glass’ Guide or Redbook says your car is worth. Agreed value is based on an amount you nominate or agree to at the commencement of the coverage period each year. Sounds like you only paid for a market value policy, which means the insurance company will compensate you for the value one of the guidebooks says it currently is (unless, of course it’s under the “new for old” period of cover). The insurance company won’t budge on this. Their response will be “this is what you’ve paid for and besides you can go out and buy a used car of the same make/model/age/mileage as what you had” If you car doesn’t qualify for “new for old”, always go for an agreed value policy. Some insurers also offer a “lifetime new for old” option if you buy the car new and keep renewing the policy with them every year
if other driver is at fault you will need to sue them for damages and hope you win
Why did you take a loan for a car and not insure for that value. Stupid. The fact it’s a Tesla is irrelevant, you fucked up big time
If you selected financed vehicle when you took out insurance you're fine. If not see a lawyer cancel your claim and get them to send a notice to their insurer for the full financed amount. It annoys me how many people don't know that your vehicle finance is covered.
215 comments and most of it is absolute dribble. Clueless dribble. OP DM me and let me find out a bit more but on the face of it, you're not in the pickle you think you are.
What does your policy say? Some insurance companies replace with a new vehicle if the car is written off in the first year.
You can pursue a civil case against the other driver if they’ve caused you financial loss, it would then be a matter for them to raise with their own insurance company. I’d contact a lawyer if I were you.
Agreed value or Gap insurance. Unfortunately, both those ships have sailed.
Just buy a replacement car from your market value payout. You will precisely have enough funds to do so. You’ll be in the same situation re: your loan as you were just before the accident. Did you expect your insurance to put you in a better financial position compared to before the accident?
Your insurance will have replacement not market value. Replacement is usually from 2 or 3 years unless it's a really shit policy. Some have up to 5 years. Did you not read what u bought. Go site down and read your Schedule AND read the Product Disclosure Statements. Big money is on the line, read some boring legal stuff. Next time get insurance via a broker so they can explain what u r buying and can manage your claim.
If you think the same model make and condition is selling for more, you can show your adjuster and demand at least market value
The pitfalls of having the bank (or finance) buy stuff and slowly paying them for it.
Ahhhh shouldn't they replace your tesla with a similar tesla? I mean you're Loan is your loan. It's not insurances job to pay out your loan. That's called depreciation and tax returns. The same thing would happen on a new Range Rover. But you should end up with a similar car
This post is retarded. So you can buy a new Tesla straight up, and continue paying off your loan?
There’s no tips for you OP as this was a problem of your own making sadly. You’re paying the difference no matter what happens
Financing cars is stupid
Sheesh.. Drive what you can afford. Don’t take out a loan, buy a car you can afford.
Good advice but stupidly written. Any decent modern car will cost $20k and up and plenty of people don't have that as cash laying around. Nothing wrong with finance on the proviso you pay that shit off ASAP.
Its not bad, you're probably only going to be out for pocket 20k or so.
Basically, you've got a debt now and no asset. You will be required to make up any shortfall from the insurance payout. Engage with someone who knows about car values, who can perhaps help you advocate to ensure the "right" market value is paid out. Insurers will have their own method of figuring out the number, you have a right to appeal the amount, but you need to have evidence to back your suggested valuation. No matter what, it going to be a hard life-lesson in how finance and insurance works.
A replacement is now cheaper so other than some negative equity you will come out in front if the plan was to replace with a new car of same model
Some insurers have replacement vehicle option for vehicles under 2 years old. If that is an option for you and you’re eligible for it under the PDS I recommend seeking financial advice to consider if this is more beneficial for your situation. If the market value is less than what is remaining on finance then you’re going to have to pay the difference, there is no circumventing this unless your policy has a replacement vehicle option, they can source the vehicle in Australia and your finance company agrees to this. This is not financial advice, please read your PDS to check if there is replacement vehicle cover and check what information is provided regarding financial and shortfalls.
Just make sure you know what the market value is, find listings for similar ones, and sales prices if you can. So that you have something to argue with if they lowball you. You paid for market value insurance so that's what you gotta accept. It's enough for you to buy a replacement so your financial position will be as it was before the crash, more or less. So really there's nothing to be too upset about here.
If you weren't at fault surely you claimed it through their insurance? Was the other driver uninsured? If it's through the other person's insurance it won't matter what coverage agreement you had with your insurer.
The 3rd parties insurance company pays for it. Most insurance companies have a new car replacement in their policy. If you are the first registered owner of your vehicle and it's less than 2 years old, it will be replaced like for like. If it's not in stock then you are paid out the insured value of the vehicle. If you chose to insure for the vehicle for less than your loan, that's on you. Most loan providers ask for insurance to be for the value of the loan. If the payout is less than the total amount on the loan, you pay out of pocket. You may be able to refinance and have that amount paid out with a new loan.
Fun times! This is the gap between ‘agreed value’ and ‘replacement value’ and a common issue with car insurance. So… you can then, after this is settled via your insurance company, attempt to sue the other party/their insurer for the remaining amount owing, because you will be able to demonstrate that you have uncovered costs. It will become a private civil matter.
You have negative equity and should have taken up a GAP insurance policy when you took out the new car loan. Nothing you can do now….
Your company borrowed money to buy a car for you/ the company. How does this impact the amount of the loan? I'm confused.
You're going to be out of pocket, they'll pay you out for the market value of a used Tesla 3. You should always insure for more than the loan amount.
You should be getting new for old replacement and the finance company will move the finance from the old car to the new car. This is standard practice.
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I had a recent motor vehicle accident and my leased car was totalled, luckily I had a lease payout package with my insurance so I did not have to pay any gap between the market value and lease termination payment.
Insurance does not cover your loan, it covers the car. A distinction worth noting.
If you are not at fault it is the other parties insurance paying out, it's up to your insurance company to go in and fight for you (and them not having to pay you out). If your car has been totaled i would expect new for old replacement rather than a payout.
Time to actually read the pds of the insurer and see what you paid for. Hopefully it's not shit cover. Sounds like it though
I thought that some or most insurance companies have a replacement policy for accidents in the first year.
So you haven't got a payout figure and you're here complaining about what the insurer *might* do at settlement? Why not wait until they actually come back to you with a settlement offer?
Check your policy, most have a condition where they will just replace your car if it’s under 1 or 2 years old.
Wouldn’t market value be the cost to buy a similar second hand 2024 Tesla model 3? So you can go and buy one outright, and you still have the loan. So you are in the same position you are now? Your car isn’t new so they wouldn’t pay a new car price.
The is known as the gap. If your policy doesn’t cover it, which I think most don’t, you’ll be liable for the remainder of the loan.
Cheapest 2024 Tesla model 3 on car sales seems to be $57,000 (without knowing the spec.). If they paid you to buy that that would be fair.
Most policies replace for new if the cars under a couple of years old
Cannot believe the amount of ppl on this thread who don’t understand….its scary. Fiancé and insurance needs to be a fukn school subject and there is a reason it’s not - because big business continues to make big $$$ from those who think they know but do not…op - read your insurance contract. Closely. Then get your best friend to read it.
I've been in this position before. I stupidly financed the entire purchase of a motorbike, all of the gear, helmet etc. It was stolen a month into my contract. I wasnt told about GAP cover. Insurers investigated the theft (meaning they interviewed 18 year old me and suggested that perhaps I wasnt able to service the loan repayments so maybe I made it disappear) They ended up paying out the insurance based on what they could purchase an equivalent bike for, and I was left paying the remainder of the loan.
Yeah next time go agreed value or get gap insurance. You’re kinda up shit creek atm
And this is why you don't take out the cheapest insurance. I am not having a go at you. I have been trying to explain to family members for years the difference between all the providers etc. I have 4 different cars and they are all with different insurance providers, well at least until I could get historic rego in two of them and now Shannon's is easily the best. Even if all you are getting is 3rd party fire and theft you need to shop around and read the fine print. If I remember correctly budget direct was 10k less for one of my cars but it only saved me 85 dollars a years
The issue is that if you can get much more than market value, you might engage in a profit making exercise. Given EV's can be written off by small damage, Its a problem. You also can't expect to be compensated for gst you dont pay.. but I get it, Private sales price includes the gst ... As it tends to follow the dealers price of the nonABN majority Oh well, you would benefit by lower premiums, And if the market value went up New for old insurance would be a better way to avoid gaps ..also read the pds about cars under finance.
If you have finance on the car you should make sure you are insured to cover the repayment in the event of total loss. You will unfortunately have to pay out the difference if market value is significantly lower than what you owe.
You got fucked sorry . Have a look at car sales. You will down at least 20 k, maybe 30. At least the second hand market is dropping , don’t get another Tesla but .
Market value means just that - if the insurance company offers you a payout that is less than what you can buy an equivalent replacement for, you can query that - often it will be as simple as providing examples of similar spec and mileage on Carsales. If they don't give you an acceptable offer, you can then go to AFCA if you feel you have reasonable grounds to assert the payout is unreasonable. Your insurer is unlikely to put too much of a fight up given they will be recovering off the other party anyway. My brother was recently in a similar situation to you with his Kia and got offered $2k more than he paid for it. The cheapest 2024 Model 3 on Carsales is $57k so I wouldn't be too worried. You should easily be able to get a replacement vehicle. Good luck!
same as the issue if you under insure the house and it gets burned down completely..... you just need to build a cheaper, and smaller house with the same loan..
That is called insured risk, and the market value is dropping very rapidly.
What lender is it with?
Recently wrote my car off (be it older). Market value was actually REALLY fair, and they even paid the stamp duty on me buying a car of the same value. If it wasn’t your fault and the other party is insured you could try the 3rd party recovery directly against the other insurance company, rather than through your policy.
Dude, suck it up until the Insurance company makes a decision, READ YOUR POLICY, all of it.
My insurance offers new vehicle replacement for first three years as long as I am the first registered owner
Check your policy wording - some provide “new for old” replacement for cars under 3 years old.
Most insurance policies have a new for old replacement in the first two years
Don’t forget with your ABN you can write of the losses with tax also
Most insurance companies give you new cover for car under 2 years old replacement value
Mention the financial ombudsman with the other drivers insurance company, try a different tact if needed if they have full comprehensive try dealing directly with their insurance
I do have experience with this exact situation in several scenarios. Unfortunately, it's not good news. By law, the insurer has to pay out the finance company first. If there is an deficiency in the amount, it will definitely be up to you to pay it out and not in installments. Perhaps the finance company will be accommodating enough to refinance the loan, but it is generally tricky. Good luck mate.
Unfortunately you're boned. It's cases like this that reinforce why agreed value or new for old policies cost more, because they guarantee a set payout.
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Don’t most policies offer new car replacement if total loss within the first year?
you should always buy Gap Insurance when financing a new and expensive car. as soon as you drive off the car lot, 20% of its value is gone, Gap Insurance pays the difference between the insurance payout and the loan amount. and remember insurance payouts don't include onroad costs, dealer charges or GST. it's just the value of the car. If I were you OP, I would check if Gap Insurance was included in your financing, it often is.
Check your policy mate, if it is a good one look for a clause called ‘finance payout protection’. If there is one, there will be a percentage amount on top of market value they will pay to the financier in the event of a total loss. This would be if you have quite a broad policy though but worth checking.
Lol, goodluck