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Old 29th March 2015, 10:50   #1
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Default Total loss accident, but car under loan. Now what?

My vehicle, Honda City Corporate 2012 model recently met with an accident. Luckily, nobody was injured. I have the car insured with L&T Insurance India. My IDV value is Rs. 6,53,000. It is under loan from a bank (I have paid half the loan, 2.5 years out of 5).

The Repairs seem to cost around Rs. 6,00,000. So, the surveyor said that the car is coming under total loss and the Insurance Company will talk to me in about 2-3 days.

Now, I have some queries.

1) In case of total loss, will I get the entire IDV value?
2) I like my car very much. I got a quote from outside workshop and they can repair it for around 2 lacs it seems.

So, if I choose this option, what should I do?

In case I choose to repair this vehicle means, I need the auto loan to be open.

3) Is it possible to get the IDV amount - the salvage value and then get the car myself and repair it without closing the loan?

Should I get any permission from the bank? Can I get the claim amount directly without closing the loan?

Last edited by GTO : 30th March 2015 at 14:42. Reason: Language
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Old 29th March 2015, 10:57   #2
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Incase of major damages, the car will never run as well as original. Also, it sounds fishy where the cost is coming to 1/3rd of what the company quotes. Id suggest just taking the idv amount and going for another car, even pre owned if new not possible. A pre owned clean car will be much more reliable than an accident vehicle.
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Old 29th March 2015, 11:06   #3
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Best solution is to let the car go, take the IDV and buy a new car. Repairing a car which is damaged so badly will
Never be the same. Plus I believe when car is so badly damaged, there is no other place than official service Center which can fix the car properly as there are many small parts which might only be available with official service Center
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Old 29th March 2015, 11:16   #4
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Default re: Total loss accident, but car under loan. Now what?

+ 1 to Subodh.
I reckon you are better off buying a new one. And though you like your car like every one else does, you may not be able to enjoy the drive and the comfort of the City.

If you can post some pictures of the extent of damage, i am sure many fellow members might be able to help you determine if a repair is possible or not.
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Old 29th March 2015, 11:25   #5
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Default re: Total loss accident, but car under loan. Now what?

Quote:
Originally Posted by jkrishnakj View Post
+ 1 to Subodh.
I reckon you are better off buying a new one. And though you like your car like every one else does, you may not be able to enjoy the drive and the comfort of the City.

If you can post some pictures of the extent of damage, i am sure many fellow members might be able to help you determine if a repair is possible or not.
The car can be repaired for about 2 lacs. There is no damage to the engine.
But the damage to the chassis is extensive.

The following parts are badly damaged and need replacement.
Bonnet, Grill, Radiator, AC condensor, Bumper, Right and left fender, Right and left Apron, Right and left Chassis Box, Center beam, Cross member, Gear box torsion bed, engine bed, Right and left arm, airbags, eps assembly, tie rod ends, right and left drive shafts and minor things.

As per the outside Mechanic, the parts are available and can be fixed under 2 lacs. But if all these parts are replaced, will the car be back in shape ? Btw, the mechanic is a trusted one.

Last edited by GTO : 30th March 2015 at 14:46. Reason: Spacing
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Old 29th March 2015, 12:15   #6
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Default re: Total loss accident, but car under loan. Now what?

Quote:
Originally Posted by SolidSnake View Post
The following parts are badly damaged and need replacement.
Bonnet, Grill, Radiator, AC condensor, Bumper, Right and left fender, Right and left Apron, Right and left Chassis Box, Center beam, Cross member, Gear box torsion bed, engine bed, Right and left arm, airbags, eps assembly, tie rod ends, right and left drive shafts and minor things.
Baba, leave the sentiment part aside, replacing the right and left apron itself should indicate that the car is a total loss. Apron is a place where lots of suspension parts are mounted, replacing the Apron involves removing the old one and spot welding a new one, No one on this planet you should trust for this except a big authorized service station which has a Car - o - Liner or similar car measure tools. Even so, these are some major chunks of the car you are replacing which IMO is not worth a dime of the effort if you are getting 6 lakh plus IDV.

Let this pass, get the IDV amount and buy a new car.

PS: The 2 lakh quote by your mechanic sounds so underquoted, if he went down to ordering all of the above mentioned parts itself for a Honda City, it would cost more than 2 lakhs, and we are not even taking the labour part in the picture.

Last edited by GTO : 30th March 2015 at 14:46. Reason: Quoted post edited
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Old 29th March 2015, 12:37   #7
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Default re: Total loss accident, but car under loan. Now what?

Quote:
Originally Posted by humyum View Post
get the IDV
Thanks bro. If i am settling for the IDV amount. Can i get the whole 6.5 lacs or any charges that will be reduced from this?

Please help me out.
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Old 29th March 2015, 18:33   #8
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Default re: Total loss accident, but car under loan. Now what?

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Originally Posted by SolidSnake View Post
Thanks bro. If i am settling for the IDV amount. Can i get the whole 6.5 lacs or any charges that will be reduced from this?

Please help me out.
Yes, you can get the whole of 6.5 lakhs back, demand that from the Insurance company. What they do is, sell the car to the scrap dealer, whatever money you get from there and out of that whatever is left over of the 6.5 lakhs will be reimbursed by the insurance company. SO it's a 2 part installment cars.

I say this again as a well wisher. Junk the car and buy a new one. The pit to repairing such a damaged car only runs in one direction, DEEPER.
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Old 29th March 2015, 19:26   #9
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Default re: Total loss accident, but car under loan. Now what?

Quote:
Originally Posted by SolidSnake View Post
Can i get the whole 6.5 lacs or any charges that will be reduced from this?
You will get almost all of IDV (just compulsory deductible of 1,000 will be cut).

What is the amount of outstanding loan?

In this case, bank will also will be involved due to hypothecation.

Just thinking aloud...

1. Insurance company might generate pay-order towards the bank.
2. Bank + insurance can coordinate and swindle (at lower level), bank can agree with insurance company on an amount that is between total outstanding and IDV.
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Old 29th March 2015, 19:38   #10
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Default re: Total loss accident, but car under loan. Now what?

Quote:
Originally Posted by SolidSnake View Post
I got a quote from outside workshop and
they will repair it for around 2 lacs it seems.
As others have already suggested, don't go this route. I'm sure the outside workshop would be planning on doing only the works to make it look like a Honda City, not behave like one. Most likely, he would be planning to ignore things like airbags while putting the car back because "they don't do anything" according to these folks!

Most importantly, you should remember that you are sacrificing the IDV on this car since the insurance company might only agree to refund your repair costs and you are unlikely to get any resale value from this car later if you try to sell it off. Since the car is under loan, I think the bank might also not agree on the repair since the collateral against the loan is the car, which wouldn't be worth the outstanding amount after the repairs.

Since selling the car needs to have NOC from the bank due to hypothecation, the IDV might be given to the bank and the balance amount after settling the loan might be given to you by the bank. Check with your branch manager if there is a way to use the IDV to buy a new car and continue the same loan or whether you need to close the current loan and take a new loan for the next car. Even if you need to close the loan, you might be able to get the foreclosure charges waived off in case you are taking the new loan from them. Someone who has gone through this before can probably clarify the exact process.
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Old 29th March 2015, 21:24   #11
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Default re: Total loss accident, but car under loan. Now what?

Have decided now not to go the repair way.. Will be buying a new car or a preowned car ( Mostly Civic) . I will update the thread once I receive updates from the Insurance Company and the bank.

The only thing I am worried is whether I will get the whole 6.5 lacs because the surveyor was telling like I will lose like 15-20 % of the IDV , which he reduced to 10 % after I argued with him a bit .
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Old 29th March 2015, 22:06   #12
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Default re: Total loss accident, but car under loan. Now what?

Quote:
Originally Posted by SolidSnake View Post

The only thing I am worried is whether I will get the whole 6.5 lacs because the surveyor was telling like I will lose like 15-20 % of the IDV , which he reduced to 10 % after I argued with him a bit .
What is the reason given for the reduction in the IDV?
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Old 29th March 2015, 22:38   #13
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Default re: Total loss accident, but car under loan. Now what?

Quote:
Originally Posted by SolidSnake View Post
The only thing I am worried is whether I will get the whole 6.5 lacs because the surveyor was telling like I will lose like 15-20 % of the IDV , which he reduced to 10 % after I argued with him a bit .
Reduction in IDV every year is to accommodate the depreciation of the car's value. So I don't see any reason why there should be any further reduction on top of IDV. Being private insurance companies, do check the fine print of the policy if there is any processing fee for total loss claims.

There are a couple of last resort options like Insurance Ombudsman and IRDA helpline, but I would suggest you to go that route after getting whatever these guys are giving so that you can close your loan and then file a compliant for remaining amount. Otherwise, these disputes could potentially get dragged on and the payment be put on hold till this is settled with your bank loan accumulating interest in parallel.

Last edited by zenren : 29th March 2015 at 22:40.
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Old 29th March 2015, 23:42   #14
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Default re: Total loss accident, but car under loan. Now what?

Quote:
Originally Posted by SolidSnake View Post
The only thing I am worried is whether I will get the whole 6.5 lacs because the surveyor was telling like I will lose like 15-20 % of the IDV , which he reduced to 10 % after I argued with him a bit .
Usual haggling tactics since surveyor it trying to pocket some money from salvage.

What is expected:

1. Money from salvage
3. Payment from Insurance company

Must patch the IDV (minus some minor deductibles) . This thread is one of a few examples on forum:

http://www.team-bhp.com/forum/street...ml#post3349810 (Skoda Laura Accident. Rolls over, yet keeps us SAFE!)

Quote:
The buyer of the car (as-is-where-is) pays the first portion and the insurance company pays the second portion, both of which add up to the claim settlement amount.
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Old 30th March 2015, 00:18   #15
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Default re: Total loss accident, but car under loan. Now what?

Following thread might also be of help:

http://www.team-bhp.com/forum/indian...ml#post2660296 (Sparky Dies a Brave Death: ICICI Lombard plays truant)

Quote:
I am glad to inform you that after many travails, dead ends, patient mailings in which we took a firm stand, ICICI Lombard has finally agreed to pay us the IDV value (minus Rs.500 which is 'compulsory deduction').

We have thus received two cheques - one from the scrappage dealer and one from ICICI Lombard totalling approximately Rs.2,10,000.
The same thread helped another member:


Quote:
I did not said a word, but just presented a print-out of your above post, where ICICI Lombard had to pay full IDV. Finally they agreed to Rs. 10,000 less than IDV & we accepted.
http://www.team-bhp.com/forum/indian...ml#post2719944 (Sparky Dies a Brave Death: ICICI Lombard plays truant)
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