Matt Gephardt and KUTV in Salt Lake City have a good story about a Utah man who was hit by a state vehicle and its insurance company — which is the state itself — shortchanged him on his 1985 Mercedes-Benz SL Convertible.
The car was totaled, and the state offered to pay $8,000 for the car. Tyler Winger, who said he restored the car with his grandfather, said the car was worth $12,000 to $13,000. (He’s not completely wrong.)
Winger said the state told him that they wouldn’t budge and that he couldn’t complain to the state’s insurance oversight board since that board doesn’t have oversight over the state’s self-insurance company.
According to the report, the state’s insurer told Winger his only recourse would be to sue the state, which could cost thousands more in legal fees.
Winger opted to go through his own insurer, which gave him $11,000 for the damage and allowed him to keep the title for the car — something the state insurer wouldn’t let him do. He said he and his grandfather plan to restore the car again.
Unsurprising. Someone I know was rear-ended by a city trash truck. City refused to pay, and after they were sued, tried to get out on a technicality (or more precisely, an erroneous interpretation of a statute), and when it didn’t go their way appealed it all the way to the state supreme court. Only after the ruling came down against them did they eventually settle almost 3 years later. They did this for every accident involving a city vehicle. Some people gave up, I’m sure. Even those who lawyered up had their cases dragged out for years.
If you have unlimited resources and unlimited time then you may as well fight to the bitter end.
Also winning against the state sets an unwelcome precedence.
This is what all those ‘don’t waste my tax dollars!’ people should be happy for. I mean, when you have a full legal department to defend you it’s hard not to use them, I mean if you’re a hammer everything is a nail.
I was rear-ended by a city bus in January, totalling my car and pushing me into the back of a Focus hatcback, the female driver of which lawyered up onsite. I had changed lanes about a block earlier, using my signal, and had full possetion of the lane. It was ruled the vus driver’s fault at the scene. Upon “further review” of the bus camera’s footage, the police changed the ruling to entirely my fault for cutting in front of the bus and not using my signal. I considered fighting, but later learned that the police officers and bus drivers share a union. The bus company refused to let anyone other than the police view the footage. The damage on ny car (from the bike rack on the bus) was indicative of a dead-center hit. The diagran drawn after the incident by the police showed my car sideways in the lane, with the rear hanging completely out of the lane – not a possible orientation given the dead-center hit from the bus to the rear of my car or the dead center damage to the Focus. I was advised by several local lawyers to let my (thankfully, high) insurance limits cover it and let the insurance duke it out in court on the Focus driver’s claim, hopefully eventually with a subpoena for the bus video proving the truth. Othewise, my options were to take the loss of the car (book value $1400, no towing fee if i turned the title over within 48 hours to a city-affiliated towing service) and pay the $130 fine while pleading no contest (in PA this is read as a “guilty” plea), and take 4 points on my license for reckless driving due to the supposed failure to use a turn signal, or else drag a court case out, risk making enemies of the police force in the city where I work, and spend untold thousands of dollars on fighting a municipality with 130,000 residents (almost half of which are “rich” enough to pay taxes) and a national police union striving to protect an overpaid and truly reckless vus driver. I took the hit and wished my insurer all the luck in the world. What choice did I have? I make $21,000 a year and do not have a lawyer on retainer. Welcome to modern America…
I had a similar experience. We had a 1965 Mercury Comet Villager wagon my great grand father bought brand new. Special ordered the top of the line wagon with zero options-radio delete and 3-on the tree. It had been in our family since, with myself the fourth generation. I rode in the car as a youngster and have memories so irreplaceable that linked myself to that car.
It was hit while legally parked by a mailman driving 45 in a 25. Vehicle instantly totaled. Post office is “self insured” so nothing you can do. They make you jump through hoops to file a claim. I had to find someone to estimate the car, pretty much impossible given age and rarity (one of 1,300 made). Finally after several years of haggling got them to give us a $3,000 cash offer, and negotiated to let us keep the title. Got another $1,000 from the state for junking it as a gross polluter, and another $1,000 from selling the many parts that were pulled prior to junking.
The car is irreplaceable regardless, as very few are left, and none with the options ours had. It’s just the way things go sometimes, but at least some cash is better than nothing. We ended up putting the money towards another rare wagon, with a similar one family ownership history and love, a 1972 AMC Hornet Sportabout V8 Gucci Edition (One of 2500 made). At least the government gave us enough for if not an exact replacement, something to honor our lost car’s memory.
Why do I care?
Must be a slow news day. I’m guessing TTAC wasn’t able to get Jack a ride in the new Shelby.
Sometimes, people write about things you don’t particularly care about. It happens.
In Virginia, the mediocracy loves to play the “sovereign immunity” card. This harkens back prior to the American Revolution, and is used to insulate the best and brightest from all but the most egregious offenses. Read up on this and drink some spoiled milk to really clean out your system. Cheers.
Where is the Godfather when you need him?
I fail to see the issue. This is why he has his own insurance. Utah’s insurance company (state of Utah) didn’t owe him anymore than what they determined to be fair market value for his vehicle. They probably used JDPower or a similar data collector to find at least 3-4 mid-80s SLs that recently sold.
The issue would be the same as if your home was destined to become the new onramp for Hwy 89 and your State only wanted to finger over what it said is “fair market value” for your home regardless of actual market value of what it’s worth.
I’ve long thought that if property taxes have to exist at all, they should only have to be paid at the time of sale on the actual transacted price, rather than yearly and based on some estimate of the property’s value.
Either that, or if the town’s going to tax your house based on some arbitrary calculation and you don’t get that amount when you sell it, the town should have to pay you the difference.
After all, you paid the tax on that value for all those years.
Most property taxes are actually highly undervalued, especially if the re-assessments are several years apart (even into decades). It isn’t as if your house is valued at 300K but because you bought it 25 years ago you’re entitled to the 50K value you paid into it. It has a current market value of 300K and it will be taxed as that.
That being said I fully support an allowance for homeowners who can’t afford taxes due to inflation or market variations to be given a lower rate so as not forced to sell out just because the market boomed around them. That’s the basic issue with gentrification in both urban and exurban areas.
Where can it go decades? Most places seem to redo it every 2-4 years. Just wondering I really hate property tax.
If property taxes are based on value and your property is assessed at 10 percent of value, you are still over-assessed if the average assessment is nine percent of value. The problem with property taxes is most governments don’t spend enough money on making them fair. Political pressure to make them fair is minimal because a fair property tax is everyone’s second choice. If you had the choice, you’d prefer to be under-assessed.
Home values have nothing to do with this. The state of Utah handled this like most insurance companies would. It’s possible he had additional coverages on his own policy that the other insurance company did not, or they just used a different service to get prices. His insurance company is just going to subordinate the state of Utah anyway. They owe the money for repair/replacement.
Just because I cannot resist:
Property taxes. The worst kind of tax.
Think of it like this: You’re just renting your completely paid off lien free property. Do you really own it? NO. You’re still renting. Miss a rent payment and watch what happens.
Now, back to our previously scheduled program…
This/ Always hated the concept.
Seems the real story here is not the specific value of the damaged car, but that the normal recourse for the aggrieved party is null and void because the state sets the rules and is also the at-fault party, thus denying him that normal recourse. If this were a claim against two privately insured drivers, the owner of the Mercedes may or may not end up with what he says the car is valued, but he would have the option to at least try to get more. This isn’t an article about what a 1989 Mercedes is worth, it’s about the continual overreach and abuse of big government.
Furthermore, I have lived in a county that had 4 successive assessors over a period of about 30 years fail to re-assess property values. During an unprecedented period of growth. When the values were finalky assessed in c.2009, values on some houses increased tenfold. There were people who were staring at homelessness because the house they built themselves in the late 1970s was suddenly taxed at 900% of the previous year’s tax value. In a state with 14% unemploynent and a 17% college education rate among adults. There were lawsuits and promises to meter out the sudden increases, but it created a mess and a half. It does happen. Assessors are local government officials, and just as apt to be corrupt and/or lackadaisical in their poition responsibilities.
Yes, this.
With most other parties, a disagreement about the vehicle’s value would ultimately move to an arbitrator and be decided there. In this case, there is no dispute process at all.
Once again, the rules apply to the citizen, but not to the state.
I wonder how this would have unfolded if he had been at fault? What does JD Power/KBB/whatever have to say about the appraised value of a former state vehicle and would that have been the claim against his insurance?
In that case, the state would get what it wants if it pushed. Between normal private parties represented by private insurers, it’s a relatively equal-footing negotiation. If the state, whose insurance commission is the deciding body as to whether or not tge private insurer does business in that state easily, or at all, is the aggrieved party, then what footing does the private company have for negotiations? Not saying it would necessarily go this way – perhaps the state would take a fair market value settlement and be done with it, but if the regulators have a bone to pick with the insurer, or even simply wish to exercise their assumed power, what recourse does the insurer have? A $100,000 payout for a wrecked 2010 Malibu is always better for a business’ bottom line than a $4m court case that drags on for years. It’s a cost of doing business for the insurer, a feather in a mid-level bureaucrat’s cap, and hopefully no citizen stuck in the middle. If so, it’s his/her problem, and there are bankruptcy law firms to scavenge thst carcass.
So what? Now tax payers have to pay for restoration of exotic cars as well? Nobody cares how much you spent on repairs of your car. In case of old and tired Mercedes it would be a lot.
Yes, if state officials cream it. No one said it was based on what he spent, they said it was based on what it’s WORTH. There’s a difference.
The insurance organization (state or otherwise) use recognized sources who establish values. These organizations do generally have a reason to keep values below market value to some extent because the sources that use them are inclined to pay less when they can. That being said though the best argument he had was that at auction it’s worth 12K which isn’t what it was insured for. They offered what most people would consider fair and when he didn’t take it it’s upon him to sue the state for the value in the court of law and prove they were undervaluing his work.
In this case he had better have an extensive list of what was done and what the cost was minus depreciation (if the restoration was done 10 years ago or 10 months ago makes a big difference) and that should be his goal.
Let’s extend this. Nobody needs more than a 2002 Civic to get them around. So no insurance will pay more than $3K for any totaled car. You chose to drive a $40K minivan, that’s your fault, not the guy that hit you.
Insurance is about making you whole. Doesn’t matter how silly what you had is- if someone else damages it, they are responsible to get you back to where you were before. Chrome wheels and vinyl wrap? Yep, pay up.
That doesn’t mean that your car is worth what you put into it- it means it’s worth what you could buy another one for. Of course, if there are no vinyl wrapped 2002 Civics around in honeyglow orange, then you probably have a valid claim that to be made whole you are owed the value of a 2002 Civic plus a vinyl install.
None of this matters if it’s a private party of a government employee that hit you.
Lets say blue book does not reflect actual market value of your car (and it never does – many get more for their totaled cars than they worth on market). Lets say BB does not apply to old cars okay lets call it collectible. Any thing might be collectible. When I was a kid I collected lot of crap and it was priceless for me. Unlike with newer cars there is not a set price for collectible car. It may cost different money depending on origin, how it was restored and stuff like that. So the only way determine the price is to put it on auction and see how much people are actually ready to pay for it to be absolutely fair. Why I have to pay for someones shoddily restored car? Based on what – his claim? Or the value of properly restored collectible car?
Guys, stop being idiots. There’s a big difference between “anyone can claim a pie in the sky number” and “car is worth KBB”.
One can show things like auction results, dealer transaction records, currently listed vehicles (with an assumed discount off of selling price), blah blah, plus receipts for work done (if it’s really a ‘restoration’ vice an oil change and some new tires there will be some parts receipts, etc).
It’s not like this is some exotic complex science.
Most insurance companies offer something called “agreed value policies” where you and the insurance company agree that the car is worth $x of dollars – and your premiums are based on that. Probably a good idea if you have a car that you have put more into than it’s fair market value.
The linked article doesn’t say whether or not he had a declared value on his own insurance policy. (Don’t know if you can do that in Utah either.)
How does this matter? Just because you and your insurer agree that they will pay you $20K if your car gets totaled by you doesn’t mean that’s what it’s worth.
The agreement between you and your insurer is irrelevant when someone else is at fault. Just like not having rental car coverage is irrelevant for the other party when you’re at fault- they get a rental car no matter since they suffered a loss. You’re the one that doesn’t because you didn’t pay for that coverage for your car if you are at fault.
I disagree. It at least gives you a leg to stand on about what the car really was worth- even smarter if you have it appraised (or something in writing, from a car club or something to give it some legitimacy). Blue book, etc., don’t always work that well with collectible cars.
Uhh… isn’t this why you have an agreed value policy with your insurer when you own a classic car?
It sounds like he might have. Not getting how much you think your car is worth is pretty much par for the classic car course with regular insurance claims. While it wasn’t his fault that the accident happned, it was his fault he was driving a classic car when it did.
I bought my dad an 89 560sl a few fathers days back, and I keep a pretty close eye on the values. Without know his milage and condition its hard to tell when the pre crash value was, but if it was “restored” but with higher original miles the 8k sounds pretty generous. But just like changing the timing belt, water pump, and installing new tires on your subaru doesn’t make it worth more than any other subaru when you crash it the next week, “restoring” your car doesn’t mean a damned thing to an insurance company unless you have a classic policy.
“Tyler Winger, who said he restored the car with his grandfather, said the car was worth $12,000 to $13,000.”
Whatever one “thinks” something is “worth” is all subjective. It depends on whether or not the buyer “agrees” to that price upon a sale. That amount is basically meaningless and just shows the owner’s greed.
Take the insurance money and title of the car and move on!
I’m curious if his insurance will pursue the state. Subro can get ugly. When I worked in insurance one of our vice presidents got annoyed when another insurance company kept kicking out his divisions subro requests so he had legal sue them on one of the cases. The legal costs ended up at many multiples of the claim and he was pulled aside and told not to let his emotions get the better of him and moved back to a position over seeing a first party claim unit.
The classic car market and how insurance companies and other bodies recognize value is just always going to be an issue vs a conventional, modern cars.
My state charges registration fees according to the car’s value with a depreciation calculation. So tags on say a $100,000 1965 Shelby Mustang could be like $18 but a $12,000 Hyundai is $100.
My advice is if you have a classic car that’s worth a lot more than most, you should have some sort of supplemental coverage with a company that specializes in this so you don’t get burned. This is usually pretty affordable.
I don’t like to see a state crush the little guy with their legal department, but the flip side as an example, I had a relative just serve on a jury trial because some crazy woman tried to sue the city for a jaw dropping amount of money because she slipped on a sidewalk. The entire jury saw it was scam and she lost, I can understand why it would be a bad idea for taxpayers if they just handed out huge checks for every grievance. Sorting through when someone is really owed something and when they’re not is not always a black and white issue so there has to me some sort of formula that needs to be followed.
This is why you need classic car insurance on a classic car. A Mercedes SL can be a $3000 beater, or it can be a $50K show car. A regular insurance company is going to try to give you the beater price every single time. This guy did exactly the correct thing – he didn’t like the valuation the other company gave him, so he went through his own insurance company (and it was likely an agreed value policy). They will then pursue the at-fault party for the money. That is part of what you pay your insurance company all that money every year for. The downside is that claims can potentially count against you, and you are probably out your deductible unless your insurance company collects ALL of the money they paid out.
The real interesting issue here is that the state has exempted it’s self-insurance operation from oversight by the insurance board. That is some Grade A BS right there! They should have to play by their own rules, what is good for the goose is good for the gander and all that.