This was the experience of Tom, a blogger from Sun City, California. He reported that their car was struck from behind in a parking lot while his wife was negotiating the car into a parking stall. Their 1993 Toyota Corolla DX sustained damage to the passenger side, front to back, including damage to the wheel covers.
The State Farm Auto Insurance claims office, Tom writes, requested that they take the car to a State Farm recommended body shop, which provided a quote of more than $2000 to repair the damage to the car.
Upon that bit of news, State Farm decreed that the car was totaled and offered, according to the owners, two options: $688.75 to settle, or sell the car to State Farm for an agreed price of $1213.76.
Without jumping at either option right away, Tom and his wife decided to shop around and do a bit of homework. After several days of checking, they could not find any comparable 1993 Toyota Corolla DX valued under $2800 at area dealers.
What's more, Tom reports, three of the cars they found for around that $2800 valuation reportedly had problems identified through their respective VIN numbers. However, Tom stresses that the VIN number on his car was free from any reports or encumbrances.
Thus, Tom's reasonable interpretation was that his 1993 Toyota Corolla DX, assuming similar mileage and after-repair condition, should not be valued anything less than the median $2800 valuation he found when checking with area dealers.
In California, insurance companies and adjusters are required to base a valuation on a similar vehicle, in similar condition, according to either the asking price, or the sale price of a comparable vehicle in the local marketplace. They are also required to substantiate their findings and conclusions, to the satisfaction of the customer.
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While it is not known, or has not been suggested by what means State Farm allegedly uses, or has used to manipulate valuations, another insurer not associated with State Farm was accused of fixing valuations by polling dealers and ultimately basing a value on the lowest price a dealer would accept for that vehicle.
In other words, they called around asking the same question, and then went with the lowest of the low-ball offers.
The state of California beefed up their statutes on April 1st of last year. Therefore, any California resident having a claim with State Farm, and either unhappy or harboring doubt as to the accuracy of a write-off valuation after April 1st of 2007, may have a claim.