Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Reviewed by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

UPDATED: Apr 14, 2022

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In a nutshell...

Consumers often focus so much on searching for an auto insurance policy that they can afford to pay for that they overlook how important it is to know how much their insurance will pay for a loss.

If you don’t know how much protection you have for your car, it’s hard to justify the expense.

While every auto insurance company handles claims in their own way, almost all policies have the same payout limitations in place.

These limitations are written into the contract to protect the insurer from paying too much to repair damages property. Enter your zip code above to get FREE car insurance quotes today!

What is an auto insurance claims adjuster?


When you pick up the phone and file a claim, you’ll speak with either a claims representative or your agent.

When you provide this information, a case is created and assigned to an adjuster who then reviews the information and contacts you.

A claims adjuster is in charge of evaluating, investigating, and settling an auto insurance claim.

Either way, it’s the adjuster who will call all parties involved to determine who is to blame for the loss and how much the insurer needs to pay to settle the claim fairly.

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Understanding the Insurance Adjuster’s Duty

Your claims adjuster may work for you at surface level, but in actuality, the company employs the adjuster to keep the payouts as low as possible.

While it’s the adjuster’s duty to settle claims in a timely manner, the company wants their claims agents to offer the lowest settlement at first in hopes of paying out as little as possible.

All claims settlements are negotiable, for damage or injuries.

How much will you receive to repair your vehicle?


Auto insurance companies follow the terms and conditions of the contract that their legal department writes.

In almost all contracts, except for ones that have special endorsements, the company is only required to pay what the vehicle was worth at the time the accident occurred.

The term that’s used to describe this limit in the industry is Actual Cash Value.

When you have a loss that results in physical damage to your car, the insurance adjuster that’s settling the claim is only going to offer you up to the car’s ACV.

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What happens if you need more than the car’s ACV to repair it?

When the damage is significant and it costs more than what your car is worth to repair it, the insurance company will consider the car a write-off.

If the car is declared totaled, you can sign over the title and receive a check for the following:

  • Actual Cash Value of the vehicle
  • Estimated sales tax for a replacement vehicle
  • Estimated titling and registration fees for a replacement vehicle
  • Costs to tow the vehicle, rent a replacement vehicle, and keep it in storage after a loss

In the insurance world, write-offs become total loss claims.

If you build your policy with a special car replacement rider, there’s a chance that you will receive more than just ACV.

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How does the adjuster determine what your car is worth?


It should come as no surprise that an insurance company will only pay you what your car is worth, but you may not expect to find out that there’s no singular reference tool that adjusters use to determine value.

Since all cars depreciate at their own rate, it’s important for an adjuster to have access to several tools.

Some of the tools that will be referenced include:

You always want to get the biggest payout when you’re settling a claim for your damaged car.

Make sure to negotiate and do your homework before you talk to your adjuster. One way to avoid going back and forth is to choose a reputable insurer.

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