What is a Deductible and Why is it Important to You?

The deductible is the amount of money that you agreed to pay your insurance company in order to be able to make a claim typically through your collision coverage. You're going to run into this in the event that you decide to use your collision coverage instead of the defendant's insurance company to get your car repaired.

A typical deductible is going to be anywhere between $250 to $500 to $1000. The higher your deductible, the lower your premium and that's kind of a balance that you have to strike depending on ultimately how much money you have in pocket and how much you're going to want to come out of pocket.

In the event that you actually have an automobile wreck and this is relevant to you of a deductible, you typically will get your deductible back but it's going to be anywhere between three to four months down the road, once your insurance company actually recoups it from the defendant's insurance company.

If you have any questions concerning your car accident or your insurance deductible, don't hesitate to contact the Hartman Law Firm at (843) 300-7600 for a free consultation today.

Is There Any Reason For You To Delay The Settlement Of Your Property Damage Claim?

No. In fact, under the law, you have a duty to mitigate your damages. You need to get your car moved from the storage facility because once it gets towed, it gets taken to the tow yard and then it typically starts running a tab of about $20 to $30 a day.

The insurance company needs to be contacted immediately and they need to go and take it from the tow yard to a storage facility so that it will not continue accruing storage fees. Lastly, the liability carrier, once it has accepted liability, only has an obligation to provide with a rental car for a reasonable period of time and typically a reasonable period of time is going to be the period of time in which it takes for them to talk to their driver, find out whether there was what the liability issues were and essentially how the wreck occurred.

More importantly, make a determination about whether your car is going to be a total loss or not. Once they make a decision about whether they're going to repair your car or whether it's a total loss, their obligation to provide you with a rental car ends at that point. It's actually in your best interest to resolve your property damage claim as quickly as you possibly can.

If you have questions regarding your property damage or your auto accident, contact the Hartman Law Firm at 843-300-7600 today.

What is GAP insurance and why is it important to you?

I run into this a good bit with a lot of my clients. Pretty much anybody who’s in a situation where they have a car that is financed by an outside lender needs to have GAP insurance in place and I will explain why.

A classic hypothetical is going to be a case in which you’re involved in a car accident and your car is totaled. Let’s just say it’s a 2004 Ford Explorer. You paid $10,500 for it two years ago.

Unfortunately, the blue book value of that car is going to be maybe $6000, $5500, because of the mark-up of the dealer when you bought the car originally.

Naturally you’re going to have to borrow that money plus whatever down payment you come up with. You’re going to have to borrow that money from a lender and if you do not have GAP insurance, this is where the math actually breaks down for you.

When the insurance company for the defendant eventually totals out your vehicle and they hand you a check for $6000, that check first of all is going to go directly to your lender. You’re not actually going to get it, which is fine because it needs to go there in order to pay off the overwhelming majority of what it is that you owe.

However, the additional $4500 that you owed on your note for your car is still out there and viable to be collected by the lender from which you borrowed the money. If you do not have GAP insurance in place, you are still on the hook for that $4500.

Most of my clients, chances are this is their primary vehicle or it’s their only vehicle and it’s usually their means to get back and forth to work. So now not only can they not make it to work but they’re also stuck with being injured and they have an additional $4500 that they have to pay their lender, plus they get the joy of going out and trying to find the money to buy a new car to get back and forth to work with, with the burden of this particular $4500 that they still owe.

Really the only option that you have at that point is you can try to finance that debt into the car that you’re about to purchase and you’re going to have to find a really good lender, someone who’s really willing to work with you and that’s going to be a difficult proposition, I have to tell you, to find a lender who’s willing to do that because essentially they’re giving you $4000 in addition to whatever it is you’re borrowing for the new vehicle and they have absolutely nothing to show for it, nothing that they can actually seize to get that $4000 back. They’re doing it on good faith. That’s a highly unlikely scenario.

So what I find is, is that my clients are in a bind where they owe that kind of money and then they call me and they want to know, “Well, what is it that we should have done in order to protect ourselves in this particular situation?”

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You have to buy what’s called GAP insurance and apparently this is a closely held secret in the auto insurance industry, which is kind of strange because a lot of times, lenders will require you to have GAP insurance but sometimes they do and sometimes they don’t.

Either way, you need to be aware of it and you need to secure it if you’re in a situation in which you owe considerably more than what your car is actually worth, because if that’s the case, you’re going to be left on the hook for a substantial amount of money and you’re not going to have anything to show for it.

Go out. Google “GAP insurance”. Find yourself a third party insurance company that’s specific to GAP insurance and purchase a policy for your vehicle, so that you don’t find yourself in this scenario in which you get into a car wreck, you’re hurt, you can’t get back and forth to work and on top of everything else, you owe an additional $5000, $6000, $7000. I’ve seen as much as $10,000 or $11,000 in some instances. I really can’t tell my clients anything. I just tell them that they’re kind of in the position that they’re in and to make the best of it.

So my suggestion to you, the public, would be get some GAP insurance. If you have questions about GAP insurance or auto accidents generally, contact the Hartman Law Firm at 843-300-7600.