Be aware of the betterment
Out-of-pocket expenses you may not expect
What is a betterment, and why do I have to pay it?
That's a good question that deserves a great answer. To understand a betterment, it's important to understand the purpose of insurance is to place us back in the same position we were in before the loss occurred - no better, no worse. Claimants can expect to pay a "betterment"
charge when required repairs places the vehicle in better
condition than prior to the incident.
To further explain, here are a few examples of when betterment charges may apply. Please keep in mind, we don't claim to agree or disagree with these practices. We're simply offering explanations for your benefit.
Example 1:
A tire with 80 percent tread remaining is damaged in an accident and needs to be replaced. The insurance company will authorize to replace the damaged tire with a new tire, but will only pay 80% of the cost, leaving the owner to pay the remaining 20%.
Example 2:
The battery is damaged in an accident and needs to be replaced. Let's assume the battery has 30% life expectancy remaining. The insurance company will authorize to replace the damaged battery with a new one, giving the owner 70% more battery life than before the accident. Therefore, the owner will be required to pay 70% of the cost of the new battery.
Example 3:
Sometimes betterment charges result from pre-existing damage in an area where new damage has occurred. These situations are little more confusing, and each insurance company handles these differently based on the circumstances, damage, and policy guidelines.
Let's assume you damage the left corner of your rear bumper. The damage is visible, but isn't bad so you choose not to repair.
Now, let's assume at some point later, someone crashes into your vehicle from the rear, catching the right corner enough to require replacement. When the insurance pays for a new bumper, you may be expected to pay a portion of the cost to replace the bumper even though you were perfectly happy driving around with light damage. In some cases, the insurance company, upon accepting liability, will replace the bumper without charging a betterment regardless of the previous light damage. Others will expect you to pay a portion of the replacement cost because replacing the bumper makes the vehicle better
than it was prior to the accident. Each situation is different, just as each insurance company is different.
Whatever betterment situation you may encounter, don't be afraid to ask questions and be your own advocate. At the end of the day, if you must pay the betterment costs, at least you'll know you've had a healthy conversation with the insurance company and have a good understanding of what they are paying, or not paying, and why.
To best understand your rights as a consumer, your own insurance company can be a valuable resource, as well as the state insurance commissioner's office. Taking and keeping detailed notes is also helpful in reminding you of what conversations you've had with whom.
Good luck, and be safe out there.
