What rights to I have for reimbursement from a negligent oil change

An oil changes was performed on my car where the oil filter was not properly re-attached. The oil leaked out of my car resulting in total engine failure. The oil change establishment contacted their insurance company who, after viewing pictures of the undercarriage, deemed it their responsibility to replace the engine. Their adjuster advised today that they may total the car altogether. I currently owe about 4,000 on the car. What I am understanding is that the insurance company will pay off based on the cash value of the car4000. If this is the case, I will basically have to refinance all over again with no down payment correct? Is there any further action I can take on this matter? Is it required for these types of insurance to provide Gap insurance? Thank you, Kristen

Asked on October 18, 2017 under Insurance Law, Tennessee

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

No, GAP insurance is not required: you are free to buy it, and it is recommended that you have it (I always get it on my leased or financed cars, for example), but it is not a legal requirement. You are correct: if the cost to repair would equal or exceed the then-current blue book or fair market value of the car, the insurer may total the car and just pay you out its then-current, or a as you put, "cash," value of the car. They do not need to take into account what you still owe on the car, the cost to refinance a new car, etc.--the current value is the only thing they must pay.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

No, GAP insurance is not required: you are free to buy it, and it is recommended that you have it (I always get it on my leased or financed cars, for example), but it is not a legal requirement. You are correct: if the cost to repair would equal or exceed the then-current blue book or fair market value of the car, the insurer may total the car and just pay you out its then-current, or a as you put, "cash," value of the car. They do not need to take into account what you still owe on the car, the cost to refinance a new car, etc.--the current value is the only thing they must pay.


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