Here are the Fair Claims Settlement Regulations from the California
Department of Insurance as they apply specifically to automobiles.
Basically, the company is required to give Fair Market Value, plus and
fees, taxes, etc., necessary to acquire a replacment vehicle of the
same type. They can adjust for depreciation of certain items or
betterment. If you had put new tires on the car, for instance, they
might increase the final adjusted fair market value. I can't see where
reimbursement for all maintenance within six months is required,
unless that is a special coverage of the policy. If it isn't in the
policy, then it isn't a requirement.
Fair Claims Settlement Regulations
http://www.insurance.ca.gov/LGL/Fairregs.htm
"Section 2695.8. Additional Standards Applicable to Automobile
Insurance
(a) This section enumerates standards which apply to adjustment and
settlement of automobile insurance claims.
(1) the words "automobile" and "vehicle" are used synonymously; and
(2) a comparable automobile is one of like kind and quality, made by
the same manufacturer, of the same or newer model year, of a similar
body type, with similar options and mileage as the insured vehicle.
Any differences between the comparable automobile and the insured
vehicle shall be permitted only if the insurer fairly adjusts for such
differences. A comparable automobile must be and available for retail
purchase by the general public in the local market area within ninety
(90) calendar days of the final settlement offer.
(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.
(2) The insurer may elect to offer a replacement automobile which is a
specified comparable automobile available to the insured, with all
applicable taxes, license fees and other fees incident to transfer of
evidence of ownership of the automobile paid by the insurer at no cost
other than any deductible provided in the policy. The offer and any
rejection thereof must be documented in the insurer's claim file. A
replacement automobile must be in as good or better over all condition
than the insured vehicle and available for inspection within a
reasonable distance of the insured's residence.
(c) Every insurer shall, if notified within thirty-five (35) calendar
days after receiving the claim draft or final settlement offer that
the insured cannot purchase a comparable automobile for the gross
settlement amount, reopen its claim file and utilize the following
procedures shall apply:
(1) The insurer shall locate a comparable automobile for the gross
settlement amount determined by the company at the time of settlement
and shall provide the insured with the information required in (c)(4),
below, or offer a replacement vehicle in accordance with section
2695.8(b)(2). Any such vehicle must be available in the local market
area; or,
(2) The insurer shall either pay the insured the difference between
the amount of the gross settlement and the cost of the comparable
automobile which the insured has located, or negotiate and purchase
this vehicle for the insured; or,
(3) The insurer shall invoke the appraisal provision of the insurance
policy.
(4) No insurer is required to take action under this subsection if its
documentation to the insured at the time of final settlement offer
included written notification of the identity of a specified
comparable automobile which was available for purchase at the time of
final settlement offer for the gross settlement amount determined by
the insurer. The documentation shall include the telephone number
(including area code) or street address of the seller of the
comparable automobile and:
(A) the vehicle identification number (VIN) or,
(B) the stock or order number of the vehicle from a licensed dealer,
or
(C) the license plate number of such comparable vehicle.
(d) No insurer shall, where liability and damages are reasonably
clear, recommend that the third party claimant make a claim under his
or her own policy to avoid paying the claim under the policy issued by
that insurer.
(e) No insurer shall:
(1) require that an automobile be repaired at a specific repair shop;
or,
(2) direct, suggest or recommend that an automobile be repaired at a
specific repair shop, unless,
(A) such referral is expressly requested by the claimant; or,
(B) the claimant has been informed in writing of the right to select
the repair facility; and,
(C) the insurer that elects to repair a vehicle or directs, suggests
or recommends that a specific repair shop be used, shall cause the
damaged vehicle to be restored to its condition prior to the loss at
no additional cost to the claimant other than as stated in the policy
or as otherwise allowed by these regulations.
(3) require a claimant to travel an unreasonable distance either to
inspect a replacement automobile, to conduct an inspection of the
vehicle, to obtain a repair estimate or to have the automobile
repaired at a specific repair shop.
(f) if partial losses are settled on the basis of a written estimate
prepared by or for the insurer, the insurer shall supply the claimant
with a copy of the estimate upon which the settlement is based. The
estimate prepared by or for the insurer shall be in accordance with
applicable policy provisions, and of an amount which will allow for
repairs to be made in a workmanlike manner. If the claimant
subsequently claims, based upon a written estimate which he or she
obtains, that necessary repairs will exceed the written estimate
prepared by or for the insurer, the insurer shall:
(1) pay the difference between the written estimate and a higher
estimate obtained by the claimant; or,
(2) promptly provide the claimant with the name of at least one repair
shop, if requested by the claimant pursuant to subsection
2695.8(e)(2), that will make the repairs for the amount of the written
estimate. If the insurer designates fewer than three repair shops, the
insurer shall assure that the repairs are performed in a workmanlike
manner. The insurer shall maintain documentation of all such
communications; or,
(3) reasonably adjust any written estimates prepared by the repair
shop of the insured's choice.
(g) No insurer shall require the use of non-original equipment
manufacture replacement crash parts in the repair of an automobile
unless:
(1) the parts are at least equal to the original equipment
manufacturer parts in terms of kind, quality, safety, fit, and
performance;
(2) insurers specifying the use of non-original equipment manufacturer
replacement crash parts shall pay the cost of any modifications to the
parts which may become necessary to effect the repair; and,
(3) insurers specifying the use of non-original equipment manufacture
replacement crash parts warrant that such parts are of like kind,
quality, safety, fit, and performance as original equipment
manufacturer replacement crash parts; and,
(4) all original and non-original manufacture replacement crash parts,
manufactured after the effective date of this subchapter, when
supplied by repair shops shall carry sufficient permanent,
non-removable identification so as to identify the manufacturer. Such
identification shall be accessible to the greatest extent possible
after installation.
(h) No insurer shall require an insured or claimant to supply parts
for replacement.
(i) Every insurer shall provide written notification to a first party
claimant as to whether the insurer intends to pursue subrogation of
the claim. Where an insurer elects not to pursue subrogation or
discontinues pursuit of subrogation it shall include in its
notification a statement that any recovery to be pursued is the
responsibility of the first party claimant. This subsection does not
require notification if the deductible is waived, the coverage under
which the claim is paid requires no deductible to be paid, the total
loss sustained does not exceed the applicable deductible, or there is
no legal basis for subrogation.
(j) Every insurer that makes a subrogation demand shall include in
every demand the first party claimant's deductible. Every insurer
shall share subrogation recoveries on a proportionate basis with the
first party claimant, unless the first party claimant has otherwise
recovered the whole deductible amount. No insurer shall deduct legal
or other expenses from the recovery of the deductible unless the
insurer has retained an outside attorney or collection agency to
collect that recovery. The deduction may only be for a pro rata share
of the allocated loss adjustment expense.
(k) When the amount claimed is adjusted because of betterment,
depreciation, or salvage, all justification shall be contained in the
claim file. Any adjustments shall be discernable, measurable,
itemized, and specified as to dollar amount, and shall accurately
reflect the value of the betterment, depreciation, or salvage. The
basis for any adjustment shall be fully explained to the claimant in
writing and shall:
(1) reflect a measurable difference in market value attributable to
the condition and age of the vehicle, or
(2) apply only to parts normally subject to repair and replacement
during the useful life of the vehicle such as, but not limited to,
tires, batteries, et cetera.
(l) Every insurer shall provide reasonable notice to a claimant before
terminating payment for storage charges, so that the claimant has time
to remove the vehicle from storage.
(m) Unless the insurer has provided an insured with the name of a
specific towing company prior to the insured's use of another towing
company, the insurer shall pay the reasonable towing charges of the
towing company used by the insured.
NOTE: Authority cited: Sections 790.10, 12921 and 12926 of the
California Insurance Code and Sections 11342.2 and 11152 of the
California Government Code. Reference: Section 790.03(c) and
790.03(h)(3) of the California Insurance Code."
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