My car deemed a total loss a second time

I was involved in an accident 2 months ago and my insurance provider deemed it a total loss. They paid me the KBB value which payed off my loan and I purchased it back for $1500. I have just been involved in another accident and this time my car is completely totaled. I was just offered by the insurance company the $1500 I bought it back for plus tires I recently purchased. Now this is way too low in my opinion. I was driving the car and it was certainly valued much more that $1500. What is my best way to proceed? I valued the car on KBB with the damage from the first accident and it was $7,500. I also noticed that the estimated cost to repair the car was at $13,000 from the current accident but this figure was immediately removed from the Geico App I use on my phone. I found that odd? What are my options?

Asked on January 30, 2019 under Insurance Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 1 year ago | Contributor

No, under the facts you describe, they do NOT need to pay you more than your cost to acquire plus the tire cost. You are compensated by insurance for accidents--the pay for your loss (less any deductible) so you don't lose (too much) value. But you can't profit. 
Example: say the KBB was $15,000 (to pick a number for illustrative purposes) at the time of the first accident. If the car was totalled and you were paid that, you were "made whole." Now you purchased it back for $1,500 plus (for example) $500 in tires. So if you are paid by insurance that net $2,000 more, you have received a total of $17,000 for a car which was worth $15,000 and in which you put an extra $2,000--or $17,000. You would have received $17,000 for a car with an all-in value to you of $17,000. You are, again, made whole--you loss is paid for.
Say in the alternative, using the numbers from above, that you received $15,000 to total the car the first time and get the $7,500 that you think it was worth after the accident the second time. In that case, you would receive $22,500 for a car with an all-in value to you of $17,000--you would have made a $5,500 profit. But insurance, as stated, compensates you; it is not intended to generate a profit for you. Your insurer, in this example, does not need to overpay by $5,500.


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