Are there really people out there who wouldn’t otherwise buy insurance, but they choose to do so only because the cost of repairs is too high?
I don't carry collision insurance on my daily drivers (the newest of which is 9 years old), because it's too expensive for the coverage offered.
There’s some competition here in that a marketplace of insurance companies can compete on the premiums so there can be downward pressure, sometimes. But for things that impact all insurance companies like this equally, then insurance companies would also be opposed because more expensive repairs = more money in their pocket.
That’s why you see things like medical insurance not being aligned with lowering medical costs.
That's not my experience in the UK and Norway. At least with the good insurance companies. I creased the rear passenger door of my Tesla S in the UK three years ago. It was purely cosmetic damage confined to a 10 cm diameter area at the front bottom corner. My Norwegian insurance paid 4 kUSD for a new door skin and a repaint of almost the whole side of the car at the Tesla recommended body shop and ten days of car rental.
It's interesting to see how such things differ from country to country and insurer to insurer.
Health insurance companies are lambasted all the time for denying coverage for certain procedures or medicines or requiring prior authorizations to prove it is medically necessary or evidence based treatment.
https://www.oliverwyman.com/our-expertise/insights/2023/mar/...
> MEDICAL LOSS RATIO TRENDS
>Reported loss ratios are 89.4% for Elevance (fka Anthem), 86.0% for CVS Health (Aetna), 83.8% for Cigna, and 82.8% for UnitedHealthcare. Loss ratios have been impacted by seasonal patterns and the return to more stable utilization than seen in 2020.
Seems like an unsubstantiated conspiracy theory.
I actually did that once. The claims adjuster was pretty surprised at the request, and she confirmed multiple times that I really wanted them to pay out less money (parts but no labor). Then she was like, "Well, I don't know why you'd want to, but it's your decision, so OK."
The reason: someone stole my stereo and, in the process, they destroyed several pieces of the dashboard. The insurance didn't cover my (aftermarket) stereo, just the dashboard.
I was going to install a replacement stereo myself. I had installed the other one (that was stolen), so I already knew how to do it, and I knew that stereo installation requires removing the same dashboard parts. If I'd let insurance pay a shop to do it, I would have needed to have them install the parts, then take it home and remove the same parts, install the stereo, and then put them back. Buying parts at the dealer is less work and takes less time.
You likely talked yourself out of additional money.
Walking away with leftover cash in your pocket is a normal and above-board part of the process if you can do the repair more cheaply/by yourself/don't get it fixed; it's not fraud.
A friend had paint damage to his truck caused by a canopy (a large EZ-UP) being blown into it repeatedly during a storm. He filed a claim and the adjuster determined it would be something like $5,000 for a proper repaint.
He asked another friend of ours–who worked in insurance—if it was okay to just keep the money and ignore the paint damage: "Yeah, you suffered a loss, you were compensated for that loss, that's all there is to it. It's up to you if you want to repaint, or if you consider it diminished value compensation, or whatever. It's your money free-and-clear."
It feels wrong somehow, but it really isn't. Just don't try to claim the same damage again in the future.
I hit a deer a few years ago and made $5000.
> Trade certification for automotive service technicians is compulsory in Nova Scotia, Prince Edward Island, New Brunswick, Ontario and Alberta and available, but voluntary, in Newfoundland and Labrador, Quebec, Manitoba, Saskatchewan, British Columbia, the Yukon, the Northwest Territories and Nunavut.
> Automotive service technician (transmission) trade certification is compulsory in Ontario.
> Automotive service technician (steering, suspension and brakes) trade certification is compulsory in New Brunswick and Ontario.
https://www.jobbank.gc.ca/marketreport/requirements/14799/ca
In Ontario, as parent and I indicated, it's a compulsory trade. It is, in fact, a government regulation directly.
https://www.skilledtradesontario.ca/about-trades/work-in-the...
Said differently, what is blocking you from doing the repair today? Is it just that the sensor needs coding to the car or calibration?
Back in 2013/2014, my Jeep was rear-ended. Some of the body panels were back-ordered, so the repair took 2 months longer than expected. Even if I was could have done the body repair, I couldn't have purchased the parts.
Likewise, a co-worker had his airbags stolen last year and it was many months until Acura had replacements available.
A mystery that resolves itself by the end of the sentence: who the hell would steal airbags? Clearly, there's demand from people who don't want to wait months for a replacement... talk about making a market.
Someone who didn't want to pay $400-800 per bag to get their banged up car back on the road.
Who the hell buys used tires? Who buys used catalytic converters? Who puts mismatched fenders on their car?
People who need a car to get to work and don't have a lot of money and, in the case of bags and fenders, may (wisely) not have collision coverage...
I suspect that most people who need airbags are still buying them; they're just buying them at the end of a chain of fencing stolen bags.
We have categories of write off, so if insurance has paid out it affects the future value of the car.
This would be a category D [0], which makes a big difference on resell.
0: https://www.rac.co.uk/drive/advice/know-how/what-is-a-catego...
We have a company called CarFax that produces vehicle history reports for used cars, but there are many problems with it. Starting with the fact that all reports are voluntary. I have looked at cars that were clearly in floods when you know what to look for and yet the CarFax was squeaky clean.
A salvage title is only used when someone intends to restore the car, and then it goes back to a normal title once restored (or at least that is how my state did it 15 years ago - each state is different). You get the salvage title only to justify paying taxes on the actual value of the car (sales tax on a car is for actual value not the price you paid, so a salvage title is useful to prove it isn't worth what the book says) It will show up on CarFax as restored then. (though as you note most such issues never get a salvage title as they are not sold)
A car with a salvage title stays branded with “rebuilt” or “restored” in all common scenarios. There are ways to wash them to unbranded, but most are unethical and involve retitling in different states and such, rather than simply restoring the car.
Regardless, unless dealing directly with the DMV, most people call a branded title a salvage title, or at least say something like, “the title isn’t clean”.
What? Accidents, even after repair, decrease the resale value of a car, significantly in the case of a young or exotic car, less so for an older, more pedestrian car.
Having been in an accident removes some possible buyers from the pool. (Some buyers will not knowingly buy a car with damage history.) That necessarily changes the balance of supply and demand for that car.
If you had a choice between buying a car that was in a crash and repaired versus the otherwise identically equipped car that had never been crashed, which would you choose? Lots of buyers prefer the latter option, which is why they're worth more than the former option.
There are two ways to sell a sub-prime car: 1) lower the price, and 2) wait for a less-than-diligent buyer to come along. Many private sellers and dealerships are perfectly fine with #2.
Lots of people do not know how to check for unreported previous damage to a car, and lots of people do not care if the car was in an accident as long as it was repaired, has no obvious damage, drives just fine, and has a green title. These are the people who eventually buy those cars.