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The increase in total loss designations by insurance companies is due to the extremely high costs charged by the shops contracted by them to do repairs. The de

The increase in total loss designations by insurance companies is due to the extremely high costs charged by the shops contracted by them to do repairs. The designation of a car as "totaled" is often an illusion and there is a thriving parallel market of auction houses, repair shops, salvage titling companies, and resellers who take the "ruined" cars, fix them, and sell them on the used market. Insurance companies could deal directly with the lower cost shops but just like the Concur Travel cancer that is spreading across corporate America there are extremely perverse incentives between executives and boards to keep the system the way it is with all of the major players dealing only with each other. There is probably an auctioneer within 30 minutes of where you are right now who will sell you a "total loss" car that you can repair, or have repaired, for a minuscule fraction of what an insurance contractor will charge-- often for less than the insurance payout (to both you and the adjuster). Like all things fucked in our economy, the trend of exorbitant repair costs took off when private equity started buying up the regional insurance repair contractor near-monopolies like Service King (Carlyle Group) and Caliber Collision (Leonard Green).

neuralRiot 2y ago
The catch is that most banks won’t finance “rebuilt-titled” cars, you don’t have a dealer warranty (and most plainly refuse to work on rebuilt cars) and the vehicle has a 50-60% (or less) resale value than a “clean-title”.
- karma_pharmer 2y ago
  That's a feature not a bug. It's selective definancialization, and I love it. Same reason why buying tax foreclosures is such a great bargain: you don't have to compete with bank-financed buyers!
- snakeyjake 2y ago
  Deep down inside I know that is by design.
- bityard 2y ago
  Huh. Well I happen to be shopping for a used care right now and in my area at least, Craigslist and Facebook are completely swamped with rebuilt title cars. And the vast majority of them are priced the same as clear title cars.
  - SkyPuncher 2y ago
    The rebuild titles are almost always 20% to 40% cheaper in my area.
alliao 2y ago
PE will literally keep going till society start revolting
- labster 2y ago
  Until they start rebelling, society is already revolting
twojacobtwo 2y ago
I've seen this market in action. My dad had his car written off years ago and he bought it back the day after he got his payout. We just went to the yard where it was to be 'scrapped' and paid about 1/4 of the payout total to take it home. The only damage was to the side panels and bumper, so we replaced those ourselves and he still had a fair chunk of money left over. The guy at the yard said any car without damage to the frame or drive train is likely to be picked up by a used car shop or private resellers who do the repairs themselves and flip them.
rconti 2y ago
Actually, insurance companies are already _very_ aggressively steering their customers into "lower-cost" shops, leading them to believe they should accept subpar repairs in order to keep costs down and profits up. In many cases they use non-OEM parts to keep repair costs down. I think the real reason they total a car at 60-70% is because the cost is just an estimate. They don't want to keep sending an estimator out to approve more $$ in repairs, costing everyone time and money, and ultimately spending more than it would cost to just buy out the customer -- who, in many cases, might just like a big check to buy what they want, rather than weeks fixing their 'old' car. Insurance companies also like to drag their heels to punish you for standing up for yourself and selecting a high-quality bodyshop. In the case of a minor front-end accident for a car in my household, they trickled the money out in bits and pieces. Every time the shop countered the insurance company's estimate, the insurance company would take 2 days to send an adjustor out, trickle out a few more dollars, wash, rinse, repeat. It's why I keep rental car coverage for our vehicles even when we don't need it -- to hold the insurance company's feet to the fire, so they feel the financial pain, too, when they hold your car hostage for a month.
- abduhl 2y ago
  >> It's why I keep rental car coverage for our vehicles even when we don't need it -- to hold the insurance company's feet to the fire, so they feel the financial pain, too, when they hold your car hostage for a month. Most rental car coverage only lasts 30 days maximum (sometimes it’s even less). It’s unlikely that carrying rental car coverage does anything in practice when netted against the increase in your premiums and in light of the limited coverage plus the discounted rental rates insurance companies get from rental car companies. I would imagine your car insurance provider is ecstatic that you pay an extra $X amount a year to “stick it to them.”
floxy 2y ago
>Concur Travel cancer Tell us more about this.
elil17 2y ago
What do you mean by Concur Travel cancer? What are the downsides of Concur?

neuralRiot 2y ago

The catch is that most banks won’t finance “rebuilt-titled” cars, you don’t have a dealer warranty (and most plainly refuse to work on rebuilt cars) and the vehicle has a 50-60% (or less) resale value than a “clean-title”.

karma_pharmer 2y ago
That's a feature not a bug. It's selective definancialization, and I love it. Same reason why buying tax foreclosures is such a great bargain: you don't have to compete with bank-financed buyers!
snakeyjake 2y ago
Deep down inside I know that is by design.
bityard 2y ago
Huh. Well I happen to be shopping for a used care right now and in my area at least, Craigslist and Facebook are completely swamped with rebuilt title cars. And the vast majority of them are priced the same as clear title cars.
- SkyPuncher 2y ago
  The rebuild titles are almost always 20% to 40% cheaper in my area.

alliao 2y ago

PE will literally keep going till society start revolting

labster 2y ago
Until they start rebelling, society is already revolting

twojacobtwo 2y ago

I've seen this market in action. My dad had his car written off years ago and he bought it back the day after he got his payout. We just went to the yard where it was to be 'scrapped' and paid about 1/4 of the payout total to take it home. The only damage was to the side panels and bumper, so we replaced those ourselves and he still had a fair chunk of money left over. The guy at the yard said any car without damage to the frame or drive train is likely to be picked up by a used car shop or private resellers who do the repairs themselves and flip them.

rconti 2y ago

Actually, insurance companies are already _very_ aggressively steering their customers into "lower-cost" shops, leading them to believe they should accept subpar repairs in order to keep costs down and profits up. In many cases they use non-OEM parts to keep repair costs down. I think the real reason they total a car at 60-70% is because the cost is just an estimate. They don't want to keep sending an estimator out to approve more $$ in repairs, costing everyone time and money, and ultimately spending more than it would cost to just buy out the customer -- who, in many cases, might just like a big check to buy what they want, rather than weeks fixing their 'old' car. Insurance companies also like to drag their heels to punish you for standing up for yourself and selecting a high-quality bodyshop. In the case of a minor front-end accident for a car in my household, they trickled the money out in bits and pieces. Every time the shop countered the insurance company's estimate, the insurance company would take 2 days to send an adjustor out, trickle out a few more dollars, wash, rinse, repeat. It's why I keep rental car coverage for our vehicles even when we don't need it -- to hold the insurance company's feet to the fire, so they feel the financial pain, too, when they hold your car hostage for a month.

abduhl 2y ago
>> It's why I keep rental car coverage for our vehicles even when we don't need it -- to hold the insurance company's feet to the fire, so they feel the financial pain, too, when they hold your car hostage for a month. Most rental car coverage only lasts 30 days maximum (sometimes it’s even less). It’s unlikely that carrying rental car coverage does anything in practice when netted against the increase in your premiums and in light of the limited coverage plus the discounted rental rates insurance companies get from rental car companies. I would imagine your car insurance provider is ecstatic that you pay an extra $X amount a year to “stick it to them.”

floxy 2y ago

>Concur Travel cancer Tell us more about this.

elil17 2y ago

What do you mean by Concur Travel cancer? What are the downsides of Concur?