“My vehicle is worth more than that!”
“The insurance company says I’m partly at-fault for the accident. They want me to pay some of the deductible!”
“What do you mean I can’t sue the other driver for the damage they caused to my vehicle?”
I’ve heard all these things from clients.
We may be an injury law firm, but there is a property damage claim associated with nearly every motor vehicle accident case we work on. Typically, these claims are resolved without much fanfare, and without our involvement. They are (usually) relatively straightforward.
When there is a hiccup, we’ll try to guide our clients where we can, but if a lawsuit or Insurance Act Appraisal is required, the cost of fighting the dispute typically far exceeds the amount the insured would get if entirely successful. Simply put – they’re usually not worth fighting about.
When someone is seriously injured, the value of their injury claims typically far exceed the value of their property damage claim. That said – property damage claims are meaningful to our clients; in part because they are easier for a layperson to value and understand. Most folks know (roughly) what their car is worth but have no idea what their severe concussion or broken bones are worth in the eyes of the law.
Given their importance to many accident victims I have provided some commentary below on common property damage disputes that occur between accident victims and their insurance companies.
1. The insurance company does not want to pay the amount the vehicle is worth
This is probably the most common dispute that arises in a property damage claim. Adjusters and insureds sometimes engage in a showdown about the value of the vehicle.
Take the case where a well-maintained 2018 Toyota Camry with a mere 50,000 kms is totaled and the parties are left to figure out its value. The insurance company will typically start with the black book value. The insured will rightfully retort that it’s hard to find a 2018 Camry with only 50,000 kms on it, and the black book is undervaluing his vehicle.
The insurance company will point to Autotrader ads of 2015 Camrys with 300,000 kms and one bumper as comparable vehicles. The insured will retort with a curated series of overvalued ads that, while closely matching the totaled vehicle, have been on the market for a year and are not a true reflection of the vehicle price.
I’m exaggerating, but you get the picture.
Typically, cooler heads prevail, and each side holds their nose and agrees about the value of the vehicle.
If they don’t, each side appoints an appraiser. The respective appraisers meet, and can either:
- agree on the value; or
- if they can’t agree on the value, appoint an umpire to decide who is right.
The appraisal process is deserving of a blog post all on its own, but the important things to know are these:
- the appraisers and umpires are typically insurance industry experts or lawyers; and
- they don’t act for free.
The difference in positions on the vehicle value must be significant for an Insurance Act appraisal to be worthwhile.
2. You and the insurance company disagree about who is at fault for the accident
Fault matters when it comes to property damage claims. If you have optional collision coverage, being at fault is the difference between paying your deductible or not. If you don’t have optional collision coverage, being at fault is the difference between being covered for your loss or getting paid nothing at all.
For property damage claims, fault is decided using Ontario’s R.R.O. 1990, Reg. 668: FAULT DETERMINATION RULES . These rules list numerous scenarios of common accidents and stipulate how fault is assigned for each one.
Some of the fault determination rules make perfect sense (e.g., if Driver B rear-ends Driver A, Driver B is 100% at fault). Others are not so obvious. Notably, the fault determination rules specifically state that the degree of fault is determined without reference to the circumstances of the incident, including weather, road conditions, visibility, or the actions of pedestrians.
Fault also matters in a personal injury case. In order to successfully sue another person for injuries arising from a motor vehicle accident, the other person must be at fault for the accident. This fault determination is made without reference to the fault determination rules. While there is a lot of overlap, it is possible to be “at fault” under the fault determination rules, and “not at fault” when it comes to the personal injury case, or vice versa.
While generally straightforward, it is possible to disagree about how (or if) the fault determination rules are applied in a property damage case. If the insured can’t come to an agreement with the insurance company about who is at fault, the insured must sue the insurance company and ask the Court to decide.
Again – this is an expensive way to solve the dispute, especially if the dispute is over a $1,000 deductible.
3. Your ability to sue another motorist over property damage is limited
In circumstances where folks feel that they haven’t been fully indemnified by their insurance company for their property damage, they often ask if they can sue the other driver to recover the difference, or the deductible.
The answer is usually no, section 263(5)(a) of the Insurance Act takes away your right to sue another driver for property damage, but there are exceptions.
Other property damage disputes
This blog post merely scratches the surface of property damage claims. Other potential land mines include:
- Damage to rental vehicles;
- Loans on a financed vehicle that exceed what the insurance company is prepared to pay in the case of a total loss;
- Damage to property in the vehicle; and
- Damage to trailers being towed by the vehicle
Theis a common thread in all types of property damage disputes is that the cost of fighting them almost always exceeds the value of the dispute. Perhaps there is potential for some auto insurance reform here to simplify the process.
Until then, automobile property damage disputes (while interesting) will remain something that doesn’t get litigated too often. It’s just not worth the cost.
ROBERT MURPHY
Rob attended law school at Queen’s University and graduated with his Juris Doctor in 2020. He summered at and completed his articles with Weaver, Simmons LLP, a full-service firm in Northern Ontario. During his articles Rob had the opportunity to see personal injury files from both the plaintiff side and the defence side. After articles, Rob practiced injury law and general litigation with Kelly + Kelly Lawyers in Pembroke, until Kelly + Kelly’s civil litigation practice joined Bergeron Clifford in 2023.
