'Fair Market Value is not "wholesale". It means 'Market Value'.
From practical experience as an insurance agent, “fair market value” does not mean retail market value. It means wholesale market value and adjusters commonly use blue book wholesale values.
Same here, 31 years as an agent/broker. 25 years with Farmers and the last 6 as an independent broker.
As you know, the insurance companies are supposed to make the client 'whole' again, bringing them back to pre-loss position, no more, no less. If an adjuster writes the client a check for wholesale value, how does the client get 'whole' again? Most people are not able to go buy a car for 'wholesale' like dealers can.
Adjusters should also include sales tax (on the settlement value) and license plate fees (pro-rated).
As part of the negotiations, I tell my clients to ask for dealer handling fees as well, which are typically $200-500+. I doubt they ever get it, but it's a bargaining chip, lol.
"fair market value' means fair market value. The client needs to negotiate with the adjusters to get fair market value, just like negotiating with a car dealer, because that is what the adjuster is doing to the client.
Some insurance companies are very fair on the first offer to clients, while others start with a low-ball offer.
Here's a real world example of Fair Market Value: On Jan, 01, 2021, a client had his motorhome stolen from a storage lot, a 1995 Pace Arrow. He bought it private party for about $11,000, 3 years ago. The MH was a total loss, and, because RV demand has skyrocketed, so have values. The insurance carrier I placed him with paid $21,524.85 to him. The policy was Actual Cash Value.
The client was, shall we say, pleased.
OrangeOkie, do I recall you are, or were, a Farmers agent at some point?
