“Why Couldn’t OUR Car Have Been Totalled?!?”

In the wake of our minivan getting totalled in a storm two weeks ago, besides concern for our safety (we weren’t in it) followed by sympathy, the next most common reaction we’ve gotten is . . . envy.

Yes, envy.

As in, “too bad a tree didn’t total our [ancient, falling apart] car.”

Fair Market Value vs. Replacement Cost

Unlike home insurance policies, which can include a rider covering the home’s full replacement cost, car insurance policies typically only insure the vehicle’s fair market value.

In other words:  if a tree crushes your 14 year-old junker with 175,000 miles on it that’s worth $1,300 . . . your insurance company will cut you a check for $1,300.  

Minus the deductible, that is.

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

Leave a Reply