Legal Question in Insurance Law in Arizona

Coverage on loss of brand new item with loan

I just bought a new quad for $4800 had it street license and registred with insurance for the loan, there was an explosion at my house it caught on fire totaling it beyond repair, insurance say they will only cover $2800, don't they have to cover the loan amount since it was brand new?


Asked on 11/23/06, 11:25 am

1 Answer from Attorneys
James Jenkins Jenkins Law Center PLC

Re: Coverage on loss of brand new item with loan

The facts stated are not totally complete, but I will respond as to what is stated. Generally on a vehicle the insurance claim is for the fair market value, not the loan amount. Some loans equal the fair market value, some are higher and many are lower.

If the vehicle is brand new, the purchase price should be the same as the fair market value. Your policy also probably has a protest procedure, such as arbitration. Good luck.

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Answered on 11/24/06, 5:47 pm


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