The time has come for you to negotiate the actual cash value for your car. What do you do? How do you have successful negotiations for the actual cash value for your car? We have the information you need!
What Does Actual Cash Value Mean?
Before we begin with our great tips, we want to give you a great working definition of what actual cash value is. ACV or actual cash value is the amount that is equal to the cost to replace your car, minus any depreciation or if your car weas stolen during the time of loss. When you buy a vehicle, the moment you drive that vehicle off of the lot, the clock ticks as the value of that vehicle begins to diminish. Even if you wanted to sell your brand-new vehicle the day after you bought it, there is some depreciation you are going to be dealing with. Additional factors that help to age a vehicle over time include: wear and tear, mileage, any minor or extensive damage on the car, and more. The older your vehicle gets the lower it is in its value.
Replacement Cost vs. Actual Cash Value
As you can imagine, the actual cash value is typically nowhere near what it will cost to replace your vehicle. For example, if you are in a major accident and you have a totaled vehicle, the cost for you to go and buy a new vehicle is always going to be higher than what your old vehicle is worth, during the accident it was involved in. So, a viable option for you may be what is called replacement value, that can help address the issues you are having, after your accident. Instead of going with the actual cash value, you can opt to go with replacement value. In lots of circumstances, you will get a payment that you can use toward the purchase of a new vehicle and you can also use the money to pay for the taxes, transfer fees and other costs that may be included with the cost of your new vehicle. Your replacement value vehicle insurance is indeed a bit more costly than accepting actual cash value coverage. But for many car owners, that added premium is seem as a great added plus, as those same car owners do think about the expense of replacing their cars.
How Does One Determine ACV?
One way that ACV or actual cash value is determined, is the calculation or the of the replacement cost of a vehicle would be. Then you can deduct an amount that reflects wear, tear and age of the vehicle. When you replace a vehicle, it is certainly more than the vehicle is worth at the time- especially if you are dealing with a car that has lots of miles on it. So, if the replacement cost is larger than the vehicle’s worth, then you as the vehicle insurer will end up with a larger settlement, utilizing the replacement cost method to decide the ACV or the actual cash value.
What is Fair Market Value?
A good and simple definition of fair market value is: the price at which a vehicle would swap hands between an eager and willing buyer and an eager as well as willing vehicle seller. It’s important to note that neither the buyer is pressured to purchase the car, nor the seller is pressured to sell the vehicle.
“OK, What Are Great Tips You Are Willing to Share For Negotiating the ACV of my Car?”
Check out these awesome guidelines for negotiating the actual cash value of your car!
Learn What Actual Cash Value Is
Actual Cash Value is a term that refers to how much a vehicle is worth once it is sold. But you want to learn the way in which your insurance company will use it. So, you want to ask your auto insurance company. Find out the specifics of ACV as they relate to your auto insurance company.
Ask your Insurance Company How They Define ACV
When you’re dealing with your car insurance company, you want to ensure that you are “on the same page” that your insurance company is on. So, the second tip we are offering is get in writing how your car insurance company defines ACV. Many times, a car owner will run into issues when negotiating a strong and viable actual cash value for a vehicle. Note that each car insurance company uses their own proprietary procedures to obtain a figure for your ACV. So, as you obtain your counter-estimate, you'll want to know as much as possible about how they came to their figures.
Utilize An Online Car Calculator to Obtain Your ACV
There are so many activities that you can take care of online, including getting an actual cash value for your car. Believe it or now, you can get an accurate ACV on such sites as Edmunds, and Kelley Blue Book.
Check out Other Deals
You can also get a solid valuation by going out and looking for other ongoing deals from your neighborhood local dealerships. Check out cars that are similar to yours and look at the sale prices. Then, use those sale prices as a good rubric for your own actual cash value for your car.
“Sing The Praises Of Your Vehicle”!
Sure, you have a used car. But does your vehicle have a “show-stopping” interior that is in excellent condition? Does your car have low mileage? Is your car equipped with some great amenities and features? Then it’s your job to point out all of these features and items to your car insurer. Each of these items can be used as “value points.” You want your car insurance company to have full knowledge about these amenities and items, so that your ACV is increased. Don’t be afraid to “sing the praises” of your car to your car insurance company. Things such as a great sound system, GPS and other items can add value and increase your actual cash value!
Remain Involved and On Top Of Things
When it comes to negotiating the actual cash value of your car, you want to stay involved from start to finish. You also want to make sure that you communicate with your car insurance company, ask the questions you need to ask, and stay on top of things. This will show your insurance company that you are about business. Stay with the process and don’t give up. Those car owners who fail to follow through with car insurance companies or give up and take the offer that insurance companies offer, find that they will be forced to settle for the lowest possible value. You will also receive the lowest payout from that insurance company.
Does My Actual Cash Value Include Taxes?
Depending on the state in which you live, your ACV or your actual cash value may or may not include taxes. You can always count on the ACV being lower than the amount of your new car loan. Why? As we stated earlier, the moment you drive off the lot inside of that new car, the depreciation clock is ticking and your car’s value is on a downward slope. As you maintain that brand-new car, over the days, months and years, that car will continue to depreciate in value too.
What Happens After An Adjuster Looks At Your Car?
The vehicle insurance adjuster has gotten training to look for fraudulent claims, and deceit. They are trained to look for customers and car insurance owners who are attempting to claim previous vehicle damage onto a current accident claim. Adjusters are also trained to look for customers who are intending to pass off fender benders as well as collision damages that may be covered under animal damage or even comprehensive weather damage.
Unfortunately, vehicle insurance fraud that others implement in their own claims, can raise your own costs or insurance premiums. So, you should consider the fraud training your adjuster receives, as a good thing that really protects you. Insurance companies are not looking to pay for damages that already existed on your car. They want to pay for the damages that are fresh and new. Those adjusters are looking for evidence of previous damage or damage that was there before your new insurance claim. Your adjuster will also look for rust, and signs of previous damage. Your car insurance company’s ultimate goal is to pay out the LEAST amount of money to you, as they possibly can. When a car insurance company minimizes your settlement, they continue to make money. It’s just the way the system works.
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