[V8] V8 Insurance Saga.....

[Roger M. Woodbury]

I hate these insurance threads, but I thought I couldn't keep my nose out of
it.  After a career in the property/casualty insurance business during which
I owned several insurance agencies of various sorts, I can make some
comments, considering that these cars are now so old.  

Basically, the purpose of automobile physical damage insurance is to make
the loss incurred whole, with no loss and no gain to the insured.  Thus, if
a car is damaged, the amount of damage is repaired minus the deductible.  

The vast majority of auto insurance policies are written on an "ACV" or
"Actual Cash Value" basis.  What this means simply, is that the vehicle may
be repaired using parts of similar value to those that were damaged.  Hence,
if the car is, say, a 1991 V8 Audi Quattro, and the Actual Cash Value of the
car, with "X" miles, is "Y" dollars, then "Y" dollars is the maximum that
the insurance company will pay to repair or restore the car, less
deductible.  In the case of total loss, most companies always used to waive
the deductible.

Now, if the damage to the vehicle involves certain parts, and those parts
are available in the used parts marketplace, the insurance company will
likely opt to repair or replace with used parts as appropriate to "make
whole" the loss of the insured.  This is most certainly the case with parts
that have no functioning value to the automobile, and absolutely certain, if
those parts pose no overt or established safety concern for the automobiles
future performance. 

Thus in the case of knee bolsters, it is highly unlikely that a used knee
bolster with "X" miles will perform measurably better than one that is new
oem.  

Frankly, I think it is unlikely that the insurance company could be "forced"
to use new parts where used ones are available.  It is all spelled quite
clearly in the insurance contract (policy) itself.  I would be absolutely
amazed if an insurance company opted for a new, $900 part from Audi, if a
used, fully serviceable used part for $100 was an option.  

Exceptions.  Well, naturally, there are some.  Sometimes an insurance
company adjuster simply doesn't know what he is doing, and makes a mistake.
This can work in both directions.  My BMW motorcycle rolled in a low speed,
soft ground accident. Damage to the rear suspension carrier made replacement
of the parts mandatory, according to the factory specifications.  The
insurance adjuster wanted to get the motorcycle shop (an authorized BMW
dealer) to just heat and straighten the subframe.  (Magnesium/aluminum, I
think: right:  a little heat and then....right!).  I raised hell, and even
talked to the eastern regional claims VP of the company, and they ended up
seeing it my way.  The adjuster (who was an independent contract adjuster,
not a company employee) had the brains of a toad and the arrogance of the
ignorant.

The other exception is where the NHTSA has a specification for the operation
of a part, such as an airbag, and sometimes there are regulations that exist
that mandate new for old.  In that case, the insurance company might well
feel that the 60% "threshold is reached, and the car should be totaled.  It
has been a while since I was in the biz, but normally, if 60% of the ACV of
the vehicle was reached in damage, they would declare it a total loss, and
pay the ACV.  For most people this was adequate.

Now the Audi V8 is an odd animal.  There are fewer and fewer, and
unfortunately, their ACV is very, very low considering the kind and value
the vehicle really is.  More and more they will be hard to insure, if the
true value to the insured is expected in loss settlement.

Roger