Car Caught Fire, Do I Get A Lawyer To Help Tussle With The Insurance Company?

James’ Passat caught on fire and he wants to know if he should get a lawyer to help him out with his insurance claim.

We’ve had Liberty Mutual for several years. We’ve had a couple of minor accidents in the past and they’ve always been great. This, of course, is a major incident. I’m pretty sure the car is totaled, though I won’t hear from the insurance adjuster for a couple of days.

So is it necessary to talk to a lawyer now? Or should I assume good faith on the part of Liberty Mutual and threaten a lawyer (and Consumerist!) if I think things sound hinky?

I’m wondering less about Liberty Mutual in particular — though that’d be interesting — and more about the wisdom when to involve lawyers in insurance claims. Any advice would be welcome.

From what we hear, it’s probably a good idea to get a lawyer in this case. Insurance companies like to pay the least they can, unless they’re forced to do otherwise. — BEN POPKEN

Our Car Burned Up [Seattlest]
Our Passat Caught Fire [Jalopnik]

Comments

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  1. I’m married to a claims adjuster that deals with similar things for local government.

    Her advice is to keep calling and stay in touch, and possibly consider talking to another adjuster at Liberty Mutual in case you happen to get someone that is incompetent.

    She adds that Liberty Mutual is pretty good at paying claims and they are not substandard… there shouldn’t be any need to get a lawyer involved yet.

  2. test

  3. dculberson says:

    Test??

    I would say no lawyer yet, mostly because I hate involving lawyers unless they’re clearly needed due to someone not participating in a good faith manner.

    If it was me, I’d just wait and see what they offer (while keeping in touch and following up, of course). If the offer is unreasonable or they resist paying the claim at all, then certainly get in touch with a lawyer.

    But then, I’m pretty comfortable dealing with this sort of thing, so base at least some portion of it on your comfort level.

  4. critical_matt says:

    Why throw away part of your settlement before you begin the process?

  5. Daniel_V says:

    Being that I used to be a property damage and bodily injury paralegal (used to settle those PD claims for my clients – so lawers won’t do it, it will be a marginally interested paralegal) , my advice is that you go it yourself. LM is not known for giving probs on claims. Here is the issue for you to deal with:

    To get a total loss you need to see that the car cannot be repaired to a reasonable condition- the condition it was in prior to the incident. Due to smoke and fire damage (inside) it’s unlikely to be restored. If the fire was minor, and contained to the engine compartment, it is a different story, as some mechanical parts can actually be replaced in that case. If fire damage is extensive, it’s 99% to be a total loss.

    Part 2 the value of the car. Forget about blue book or the $ you paid for it a year ago. The insurance company has to go with the fair market value. That means the value of your car in your local newspaper. It does have to be local, since auto prices vary by area. Mileage and options should be similar.

    With this info in hand you can argue with the claim offer if it is blatantly unfair, and if nothing works do threaten to get a lawer involved. However it’s probably not going to be in your iinterest.

    Keep in mind, a lawyer will charge a commission of whatever you get. It is in the range of 25% (Rare) to 33% (usual).

    Good luck. I honestly don’t think you’ll have the problems which you now imagine.

  6. scoobydoo says:

    IANAL, but I’d certainly consider getting one here. Volkswagens are not meant to explode. Something was clearly wrong with the car or with something that was done to it. I don’t see Liberty Mutual screwing with you, but somehow I doubt Volkswagen will be too thrilled to help out.

  7. @ dculberson

    Test??

    Nothing, I was just unable to post comments for a couple hours today and was seeing if I could comment again.


    I just love the photos that you guys keep coming up with. I am impressed.

  8. dwarf74 says:

    If your insurance company hasn’t done wrong by you yet, I’d keep the lawyers out of it. It will only make the lawyers richer & you poorer.

  9. KevinQ says:

    Generally speaking, if somebody has to ask the question “Should I get a lawyer,” the answer is yes. The question gets asked because the person asking feels like they’re in over their head.

    That being said, if you feel like you can follow the advice of the other commentors up above (figure out how much you should get, be prepared to argue with the insurance company, follow up constantly) then you probably don’t need a lawyer – especially if nobody else was involved, and there were no injuries. Arguing about medical bills and pain and suffering are where things get complicated, but if it’s just a question of the value of your car, you might be able to handle it yourself.

    But you might make a phone call or two to try to line up a potential lawyer, just in case things go bad.

    K

  10. KevinQ says:

    Also, one other thing. Most lawyers will charge a contingency fee that changes based on when you get your money. If they get you your money quickly, it could be pretty low. If they get the money during settlement talks, expect to pay 25%. Most lawyers only charge 33% if they have to take you to trial.

    K

  11. mackjaz says:

    In my modest experience, it’s better to wait until you need a lawyer. You can play that card, if necessary. If it doesn’t get to that point, you come out ahead.

  12. Scott says:

    As a lawyer who used to work as an in-house defense firm, I would say take a wait and see approach. From what I remember, Liberty Mutual is a decent insurance company. You’ll have to do your homework and make sure that they are not screwing you along the way. Don’t forget about the rental car.

    Make sure that you’ve read your policy and understand the terms. One of the biggest problems people face which has already been mentioned above is the fact that they will look at the current fair market value of the car. My old company based their offers off the NADA value. Also generally, if the cost of repair is above 70% of the NADA value they will total the car. You can also make a case that the car is no longer safe and therefore totaled.

  13. critical_matt says:

    Sigh. I don’t understand the thinking in running for a lawyer straight away. First, find out if it’s a total loss. If you think it is and the insurance co says its not, make sure it’s at YOUR bodyshop. Get their opinion. They’ll be straight with you on its condition. As noted above, don’t bother using blue book, no one else does. It doesn’t give an accurate picture of the value of your vehicle. NADA is better, newspaper is best. Be fair to yourself in grading the condition of your vehicle. It’s most likely in average condition(even if you think it’s in great condition). Do your homework, and take a look at the numbers before calling an attorney. You think it’s worth $100. The insurance company says $85. You don’t compromise and you get an attorney. He does a great job and gets your $100, but then takes his $33. Suddenly you’re at $67. Insurance hint: where there’s fire, there’s smoke. Keep complaining you smell smoke…

  14. scarequotes says:

    Just to be clear, it wouldn’t have occured to me to get a lawyer at this point. My biggest complaint with Liberty Mutual after several years of working with them is that their phone tree repeats itself sometimes.

    But there’s been a small but vocal contingent of people who’ve said “go get a lawyer an hour ago, because your insurance company will try to screw you.” They’ve been vehement enough to make me wonder if getting a lawyer at this point was something I should’ve thought of.

    My inclination is not to get a lawyer — in part because of the money, and in part because I don’t assume bad faith on the part of LM. But I wanted to make sure I’m not being naive.

    Sounds like homework, homework, homework is the real answer — as it so often is in consumer matters, it seems.

  15. scarequotes says:

    Also, scarequotes is James, the guy with the crispy Passat. I’ll keep you posted on how things shake out.

  16. Camon says:

    If youre gonna be dealing with Lib. Mutual I’d suggest having one ready.

    I have had horrible experiences of dealing with them when one of their customers caused an accident. They tried to under pay me and call my vehicle a total loss.

    Best bet is to be ready.

  17. matto says:

    I totalled a car last year, and CSAA gave me the full edmunds.com private sale price with no hassle whatsoever. Dunno if your insurance company is different, but I’d give them a few days before calling in the sharks.

  18. North of 49 says:

    ICBC has decided that any accident where there is less than $1000 in damage to the vehicle is one they will not compensate for. I pay more than that in insurance for my vehicle in a year even with my discount. So, at least consulting a lawyer might be a good idea.

  19. Sam Glover says:

    I second all the wait-and-see responses. You have

  20. Sam Glover says:

    I second all the wait-and-see comments. Why split recovery with a lawyer if LM takes care of you?

    However, never threaten “I’ll hire a lawyer” or “I’ll sue you!” Can you imagine how many times a day insurance companies hear that? It won’t get you anywhere except to an irritated insurance representative.

    Once you know you are going to need a lawyer, just do it. Let the insurance company find out when they are served with a lawsuit.

  21. vanilla-fro says:

    I’m an adjuster and we get plenty of insured’s and claimant’s who get lawyers for property damage (no bodily injury involved) and I always wonder how they go about getting the work or replacement paid after the lawyer gets his money. this only works when injuries are involved and you can get a bit over your actual property damage and medical bills.

    I would try a different adjuster or the claims manager/supervisor.
    depending on the age of the vehicle and the cause of the fire, Liberty Mutual should be happy to pay since they will be going after the maker for subrogation (getting paid back for what they paid you and most likely getting your deductible back)

    There is the slight possibility that you may not have the right coverage, I think we have seen that on here a lot. in that case you would want to talk to a lawyer regarding your policy wording or going after the maker (sometimes policy wording is vague and can be turned around a bit).

  22. nweaver says:

    Also, lets face it, a totaled out passat is NOT a big claim, and its also very easy to verify and make sure you get made whole (basically hold out for high blue blook or what the market on craigslist is, whichever is higher).

    Its when you have medical bills, pain and suffering, someone else’s insurance company, etc that you really NEED a lawyer.

  23. mglasspo says:

    I had experience with almost totalling my parents car. I didn’t need a lawyer. The insurance company was falling over themselves to make sure everything was ok.

    The first questions they asked were “are you ok?”. They then make sure I visited a doctor to get checked out and treated for any injuries and they followed up regularly for a couple of months to make sure I was ok, didn’t miss any work, etc.

    They also had a rental car provided to us quite quickly (it was part of our insurance plan), and repaired the car back to the way it was since it wasn’t a write-off.

    The only bad part of the situation was that my parents (the owners of the car), decided to immediately sell the car and buy a new one. Even though the car was in pre-accident condition, they couldn’t get the pre-accident price because it had been in an accident.

    Let the insurance company do their job. You might be surprised at the service you can get from a good company. But beware that if you get bad service, you need to be prepared to deal with it.

  24. latemodel says:

    Dont get a lawyer till it seems obvious you are not being offered a fair settlement. Once you involve a lawyer you cant go back and the insurance company will no longer deal with you directly. Their first offer will be low as the insurance companies count on you to be in need of a car motivated to settle and the delay of making a lowball offer costs them nothing. You probable wont get what your car is worth but that seems to depend on the adjuster, who may be an independent rather than a LM employee. Adjusters get incentive pay based on their average claim so they are motivated to limit any and all claims.

  25. Charles Star says:

    When I wrecked my car I had no need to even mention that I was a lawyer to the LM adjuster, much less threaten to hire someone who knows insurance law, for her to determine that the loss was covered. Then they paid $2000 more than I expected to get. LM appears to use a third party appraisal company that is pretty generous with upward adjustments for the condition of the car at the time of the crash.

    My wife and I were very hapy with LM’s customer service. It sounds like you have been too. You have plenty of time to file a claim against LM if they don’t do right by you. Don’t hire a lawyer until you have to.

  26. Retiree says:

    My van was parked on the street & got sideswiped just after Christmas. State Farm – the other driver’s company – sent me to a repair shop right away & approved the repairs after the shop submitted online.

    A buddy of mine questioned the bill & the parts source, so I questioned them – they said to get other estimates if I wanted, they’d wait. I went to two other shops, got estimates about $1200 higher. I was prepared to take cash & buy a new vehicle, keeping the smashed one as a backup. They OK’d this and sent out their own adjuster – he gave me the highest estimate of all, totalling the van. I got a check for more than I was expecting, plus a check for a rental, which I didn’t end up needing (’twas Christmas break – my wife didn’t have to drive to school! :)

    All in all, quite happy with their performance, and the only delay in the process was me trying to figure out my options.

    Give LM a chance to do the right thing before you call out the sharks.

  27. RulesLawyer says:

    As an attorney in the Seattle area (and no, this doesn’t constitute legal advice and you’re not my client), I’d wait and see if you’re happy with Liberty Mutual’s offer. You have the benefit that they’re not a company with “state” or “farm” as part of its name, which generally means that they’re reasonable people.

    If things go south, you might consider contacting a public adjuster (10-15%) instead of an attorney (33%). I’m not sure you’ll find one willing to deal with a small claim (I hired one for a $350,000 homeowners claim), but they’re typically former insurance company adjusters, and will get you more than the 10-15% they take off the top.

  28. limiter says:

    Is this even something that is covered under insurance? If someone lit your car on fire, or another car hit your car and it caught on fire then I could see insurance covering the claim. If the car spontaneously caught fire and an accident did not occur, will insurance even cover something like that? It seems like they would say it’s a build or design defect and VW is at fault.

  29. Ben Popken says:

    That’s not just a “cool picture of a car on fire,” that is the actual picture of the actual car on fire. See the flickr link.

  30. bluegus32 says:

    Limiter: “Is this even something that is covered under insurance? If someone lit your car on fire, or another car hit your car and it caught on fire then I could see insurance covering the claim. If the car spontaneously caught fire and an accident did not occur, will insurance even cover something like that? It seems like they would say it’s a build or design defect and VW is at fault.”

    It depends on the kind of coverage that you have. If, as many people do, you simply get the least amount allowed by law then you’re screwed. Most states only require that you get minimal liability coverage. If these people were smart and bought comprehensive coverage, then this loss is likely covered under the insurance policy.

    This is why you should always carry the maximum amount of insurance coverage you can conceivably afford. Get comprehensive coverage, with policy limits as high as possible. Proper insurance coverage is one of those things that most people don’t have and don’t know it until they need it. By that time, they’re screwed.

    Digressing, if these people do have comprehensive coverage, then I would agree that obtaining a lawyer right now is premature. Wait and see if the insurance company does the right thing. If it does, then no sweat, If it doesn’t, then you can bring in a lawyer later.

  31. MDT says:

    You might also consider checking out National Highway Transportation Safety complaints regarding the vehicle. You can look for similar instances of the same problem, which will help interest an attorney and possibly your insurance company as well. You can start a search here:

    http://www-odi.nhtsa.dot.gov/cars/problems/complain/compla

    Every complain summary gives a descriptions of whether or not a fire was involved. There have been many instances of vehicles from some manufacturers that have a tendency to, well, combust. Some of these defects have been officially recognized ( I’m looking at you FORD http://www.safetyforum.com/fordcruisecontrol/ ) and some not, but by searching at least you can get some idea of whether or not your experience was a totally isolated incident.

    - MDT

  32. Daniel_V says:

    Given that these are real pics in the flickr set. I’d say you’re guaranteed a total on your car. Now your homework is just to make sure you have the real fair market value of the car down. I’d also argue that an Ipod was on the dashboard(lol)

  33. bluegus32 says:

    Deniel_V: “I’d also argue that an Ipod was on the dashboard(lol)”

    An iPod? That’s messed up dude.

    To me, it looks like a 60 inch flat panel t.v. was in the back of the van.

  34. scarequotes says:

    Just a followup:

    We didn’t get a lawyer, since our experience with Liberty Mutual had always been good before, and since most people here asked the same question we were asking (“why pay a lawyer part of your settlement?”).

    LM worried us a little bit at first, because our case kept getting reassigned to different people. Once they got their ducks in a row, however, everything went great.

    They covered our car rental (we had rental car coverage on our policy) through Enterprise, who was also great to work with.

    They hired an outside investigator to look into the cause of the gas leak and fire. He’s not done yet (that I know of), but that didn’t hold up settlement.

    Our claims adjuster totaled the car, figured out its fair market value, asked for receipts for recent work we’d had done (new tires, new front axle) and the car seat, and factored that all in.

    They paid off our lein holder, and we actually ended up getting some cash ourselves. We have absolutely no complaints about their fairness or anything else after the initial “who do we talk to?” scrum.

    So: happy ending, no lawyer necessary. We just bought a new CR-V.