Ferrari Mailing List: Re: Clyde Price! In Kalifornia Inusurance Code

[Doug and Terri Anderson (dnt]

In Kalifornia, insurance companies are not to use KBB as the pricing source 
to settle a total loss claim.  Here's the long and short of it.

DOUG
For the Cliff Notes version = Read (A) & (B).



FAIR CLAIMS SETTLEMENT PRACTICES REGULATIONS

Section 2695.8. Additional Standards Applicable to Automobile Insurance (b) 
When the insurance policy provides for the adjustment and settlement of 
first party automobile total losses on the basis of actual cash value or 
replacement with a comparable automobile, one of the following methods must 
apply:

(1) The insurer may elect a cash settlement based upon the actual cost*, 
less any deductible provided in the policy, to purchase a comparable 
automobile including all applicable taxes, license fees and other fees 
incident to transfer of evidence of ownership of a comparable automobile. 
Such cost shall be determined as follows and, once determined, shall be
fully itemized and explained in writing for the claimant:

(A) when comparable automobiles are available or were available in the local 
market area in the last 90 days, the average cost of two or more such 
comparable automobiles; or,

(B) when comparable automobiles are not available in the local market area, 
the average of two or more quotations from two or more licensed dealers in 
the local market area; or,

(C) when an automobile total loss is adjusted or settled on a basis which 
varies from the methods described in subsections (b)(1)(A) and (b)(1)(B) of 
this section, the determination of value must be supported by documentation. 
Any deductions from value, including deduction for salvage, must be 
discernible, measurable, itemized, and specified as well as be appropriate
in dollar amount and so documented in the claims file. The insurer must take 
reasonable steps to verify that the value so determined is accurate and 
representative of the market value of a comparable automobile in the local 
market area.

*ACTUAL CASH VALUE
An amount equivalent to the fair market value of the stolen or damaged 
property immediately preceding the loss. For real property, this amount can 
be based on a determination of the fair market value of the property before 
and after the loss.  For vehicles, this amount can be determined by local 
area private party sales and dealer quotations