Complaint Review: USAA Automobile Insurance - San Antonio, Tampa, Norfolk Texas, Florida, Virginia

Unfortunately, while some of the information provided by the commenters may have been offered in good spirit, it has become clear that some commenters did not comprehend what having supporting documentation means or even have reviewed the one (of many) document provided.  In that document, USAA clearly DID consider options of comparison vehicles - otherwise they would NOT have listed options for these vehicles.

As I read the opinions offered by some, who obviously were intent on proving how much they knew by spouting a wealth of information - all of which is prevalent on the Internet. I think of the old saying about "opinions and how everybody has one....."   Also, more to the point the old saying from Mark Twain, "Concerning the difference between man and the jacka*s: some observers hold that there isn't any. But this wrongs the jacka*s."

- Mark Twain's Notebook, 1898

Even $4000 for that car sounds way higher than its actual value.  There are plenty of 330i's from that year for sale for well under $3000.  Just because your combination of options is "rare" doesn't mean the car is worth more.  Options generally don't affect the price of such an old car to any significant degree. 

The value USAA uses is determined by industry guides such as NADA, and they are determined by wholesale prices.  Just becuase you found some idiot asking $8000 for a car worth $2000 doesn't mean anything.  If you did have expensive optional equipment installed, you should have had a special rider on your policy for that equipment.

As far as the cost of parts: body shops and mechanics always charge significantly more for parts than what you can find on the Internet.  Among other things, they have to take on the risk of the parts being defective or getting damaged during installation.  As such, very few shops will allow you to bring your own parts. It's kind of like complaining that restaurants charge more for wine than it costs at a discount store.

USAA (and repair shops) use industry pricing guides to calculate these costs.  Just because you found parts somewhere that were cheaper doesn't mean the estimate is invalid.  Go to any reputable body shop and see what they quote instead of pulling numbers from your a*s. 

And you are also misunderstanding and misrepresenting what Florida law says.  Under section 3(a), if the insurance company decides to pay out the value of the vehicle instead of repairing it, the vehicle is considered salvaged.  It's up to the insurance company as to what exactly the threshold is. Most insurance companies set the threshold at about 75-80%, but it is completely up to them.  It is obviously in their self-interest to repair the vehicle if the cost of repairs is significantly cheaper than the cost of replacement.  The reason they don't want to do this in this case is because the vehicle cannot be repaired for less than $3200.

But that is the excuse used here by people with absolutely no case and an IQ close to room temperature.  People who accuse commentors of such are normally ridiculed here.  However, I won't.  I understand why the insurance isn't going to give you what you want.  I told you what you needed to do.  I suggest in the future, if you are in the same situation, then do exactly what I told you.

Sometimes going cheap on the insurance gets you what you got....

• Car was not customized; as stated just had certain factory options
• Insurance on high valued cars generally means owner does not drive them on daily basis (this one was)

In the interest of forthright disclosure would like to know if Jim (Commenter) (1) is or has been a USAA Employee, (2) is a lawyer, and (3) is or has been insured by USAA. 

I'm afraid to tell you that in a court of law, if you were to provide a value that someone might want to buy a similar, or even the equivalent car, that value would be rejected.  There have been several court cases within the last 3-4 years that would bear this out.  Insurance companies have simply followed what the courts have said in these situations.

Now, one of the nice things about having a car like the one you had is that the customization makes the car both fun to drive and a status item.  The problem however is that in an insurance case, the adjustor will generally not take the customization into consideration.  I mean let's face facts:  no one customizes a car so they can get a higher value reimbursement when the car is totalled because no one intends a car gets totalled.  They customize a car because it's cool.

However, when you have a classic or customized car, you actually need to buy classic or custom car insurance because regular car insurance from a company like USAA, or anyone else will not properly consider or value a custom car or a classic car properly, and your car might qualify in such a situation. 

If there is an accident that destroys a classic or custom car, there is a often a guaranteed value of reimbursement that is a part of the insurance policy.  USAA will not offer you classic or customized car insurance - you actually need to go to an insurance broker for such a thing.

Such a policy can even be cheaper than regular insurance, provided the car is driven less than a certain number of miles per year, or the driver is more mature, etc...  You would need to contact a broker that deals with such things - I doubt seriously someone like USAA would have ever had such a policy.

I appreciate your point of view, honestly I do.  I just would not be so hard on the insurance company in this situation......

Jim,

I' sure you also meant well in your comments.  However they did contain some erroneous information which might lead others to wrongful conclusions.

As I indicated at the conclusion of my report, we have written documentation of everything (including names) supporting all statements made within this report.  I now also add this includes the complete documentation of the processes by which USAA did their repair estimate - and - their valuation of the car.

Another disclosure:  My son is a licensed agent in the State of Florida (although now in banking) who is well versed on, and authorized to sell, automobile, home, and life insurance.

Your statement, "The options you're talking about have a zero value reimbursement in an insurance valuation situation.  It also would not consider the upgraded automatic transmission.  These options and upgrades make your car wonderful to have and to drive.  BUT, they have no value in an insurance situation." may be true in other cases - BUT NOT in how USAA preformed this valuation.  First, when USAA was alerted to the fact that the car had a $3,000 SMG option not included in their assessment USAA then INCREASED their valuation of the car by $150 (not a lot - but an amount at least indicating that some upgrade options DO matter).   Second, regarding "other" options:  USAA listed for each of the three detailed comparison cars (and my son’s damaged car) a complete list of all options for comparison (see the attached valuation sheet).

Your statement, “the values you reference would be for people wishing to sell the automobile and what the car would be valued in such a situation.  An insurance company cannot use those values.  Again, wrong in this case.  First the examples we offered were mainly from dealerships – NOT private owners.  In addition, USAA in their own valuation listed 11 (eleven) total vehicles for comparison and used three for detailed value comparison.  If the three used for detailed comparison, two were from dealers and one from a private owner.  (See again the attached valuation sheet).

I apologize that my synopsis was not more clear to you.  Regarding Your Statement, “Aha!!  Now this is what should have been done.  If your insurance company intended to declare your car a complete loss, then your son should have simply told USAA 'never mind' and 'go away'.  He could have taken the car to a shop and pay the actual repair cost.  He gets the car fixed AND keeps the car.  What I believe you missed were two key points: 

(1) First, was the issue of USAA erroneously stating that they were mandated to declare the car a total loss – which would result in a salvage title – which would then make the car more difficult to insure.  This issue centered around how USAA miss-applied the verbiage in the applicable Florida statute and, when educated (to include being shown an email from the Florida CFO’s office), then increased their damage estimate to ensure that a reissuance of title was necessary; and

(2) Second, USAA was offering different amounts for different courses of action.  My son had NOT surrendered the car to USAA, but was attempting to arrive at a fair settlement – AND – without having the car declared a total loss.  USAA was offering $2,673 if my son retained ownership – BUT WAS INTENT on declaring it a total loss.

By the way, although USAA had been notified in two lengthy memorandums sent to their Executive Committee, and in three separate conversations involving Supervisory Claims Personnel (the conversations documented in MFRs) that my son intended to keep the car, on Jan 23, USAA unilaterally sent him a check for the amount originally offered by them to take ownership of the car.  He immediately notified them that this was NOT his chosen course of action – and that he would be keeping the car.

Again, I stand by my original comments that – in this case –I felt USAA’s actions were questionable if not dishonest and I urge all potential new customers to beware and do some comparison shopping

Just to clarify:

I'm sure the commenter meant well.

The purpose of my original Ripoff Report was to alert other potential customers (i.e., must be a military veteran or family member of current USAA Member) of one very disheartening experience.

However, being a veteran does have something to do with this report as it would ONLY apply to military veterans or eligible family members of current USAA Members who are considering selecting USAA.

As my son is a agent within the state of Florida, licensed to sell auto, home, and life insurance products, he (and I) were both well aware of how the repair estimation & valuation processes work and when an arbitration process may be beneficial. 

For All:  While arbitration may be an appropriate course of action depending on the dollar amount in dispute, the cost of hiring a representative to plead your case in an arbitration hearing (which can be of either "binding" on "non-binding" in nature) can run one or two thousand dollars. 

In this case we were really not disputing the original amounts offered by USAA - only that USAA was erroneously stating (and attempting to apply) the Florida Statute - which does not mandate declaring an automobile a total loss if the cost of repairs equals (or even exceeds) the value place on the car; only that the owner must (in that case) send the title to the State of Florida for reissuance as a "salvage title." 

The problem you have is that you're essentially talking about a 16+ year old car.  Regardless of what you think, the KBB value of the car is going to be pretty low - in that situation - regardless of how many special options on the car there are.  Now, to the rest of  it:

The associated “Market Valuation Report,” also prepared by a third party, was $3,963.00, which we felt was too low – because not a single model with identical options could be found anywhere within North America; the models USAA had used were less than equal.  The options you're talking about have a zero value reimbursement in an insurance valuation situation.  It also would not consider the upgraded automatic transmission.  These options and upgrades make your car wonderful to have and to drive.  BUT, they have no value in an insurance situation.

Our research found several identical models in the range of $13,385 to $16,608, but all based in Europe – which USAA said they could not use for comparison...Our further research found several similar (but not identical) models located in North America with prices between from $4,500 and $8,888; however, USAA did not raise their valuation estimate and offered no explanation.  The values you reference would be for people wishing to sell the automobile and what the car would be valued in such a situation.  An insurance company cannot use those values.

My son repeatedly stated his desire to keep the car and pay out-of-pocket any differences between the initial repair estimate and actual repair costs.  Aha!!  Now this is what should have been done.  If your insurance company intended to declare your car a complete loss, then your son should have simply told USAA 'never mind' and 'go away'.  He could have taken the car to a shop and pay the actual repair cost.  He gets the car fixed AND keeps the car. 

Now, the actual cost to repair the car probably would have been more than the cost the body shop claimed (body shops often enter into agreements with insurance companies to repair vehicles in exchange for a level of exclusivity), but you could maybe talk to the body shop to do the repair at the same rate as the insurance company offered?

So then you ask, why have insurance?  Well, that's a good question when it comes to an older car.  Any car over 15 years old should not carry collision or even comprehensive insurance - you should have only been carrying liability insurance in case you have an at-fault accident.  If the intent here is to keep the car because of its sentimental, as well as special value because of the customization, then forget the insurance company and keep the car.

BTW - this isn't just a USAA thing.  This is an insurance thing regardless of the company.  Best of luck to you.

 First off, being a veteran has NOTHING to do with this claim or their decisions. You are RIGHT on several points but are overlooking a few. The insurance company is NOT your friend! Their ONLY purpose is to get by with paying as little as possible and they think you are so stupid and desperate you will accept any crumb they pay you.

Their adjuster works for them and not you. You could get your own adjuster to fight for you and I urge you to do that. You may also run this by an attorney as well. Bottom line is you don't need to accept any of this. Get your own adjuster and let them work on it for YOUR benefit!