If your vehicle has been declared totaled by the insurance company after a crash, the company will want you to sign a property damage release form before giving you compensation for your totaled vehicle.
A property damage release form is a legal agreement between the injured party (the claimant) and the at-fault party’s insurance company. In personal injury claims, a property damage release form plays a critical role in resolving the property damage aspect of an accident. This legal document outlines the terms and conditions under which the at-fault party’s insurance company will compensate the victim for the damage to their vehicle or other property.
However, once you sign that form, that part of your claim is closed.
For example, let’s say the insurance company offers you a certain dollar amount for your totaled car, you accept the offer, and sign the release. Several months later you discover that the value of that totaled vehicle was $2,000.00 more than what the company paid you. Because you signed the release, you cannot go back to the company to try to renegotiate a better amount. Always watch out (if you don’t have an attorney) for the adjuster offering to include a nominal personal injury settlement along with the property damage settlement on your vehicle. Red flags go up when they offer to include the injury claim along with property damage, especially where you have made no such claim yet nor submitted all your relevant bills.
Purpose of a Property Damage Release Form
The primary purpose of a property damage release form is to provide clarity and closure regarding property damage claims. It serves several important functions:
- Agreement on compensation: The release form establishes the agreed-upon amount that the insurance company will pay to the claimant for the repair or replacement of the damaged property. This amount should cover all related expenses, including repairs, towing, rental car costs, and other applicable costs.
- Release of liability: By signing the release form, the claimant agrees to release the at-fault party and their insurance company from any further liability related to the property damage. This means that the claimant cannot pursue additional claims or legal action for property damage stemming from the same accident.
- Closure: Once the release form is signed and the compensation is provided, the property damage aspect of the claim is considered resolved, bringing a degree of closure to the incident.
Key Elements of a Property Damage Release Form
A property damage release form typically includes the following key elements:
- Identification: The form identifies the parties involved, including the claimant and the at-fault party’s insurance company.
- Description of the incident: It describes the accident, including the date, time, location, and circumstances that led to the property damage.
- Compensation amount: The agreed-upon amount for property damage compensation is clearly stated. This should cover all reasonable and necessary expenses related to repairing or replacing the damaged property.
- Release of liability: The release form includes a clause indicating that, upon acceptance of the compensation, the claimant releases the at-fault party and their insurer from any further liability for property damage related to the accident.
- Signatures: Both the claimant and a representative of the at-fault party’s insurance company must sign the release form to make it legally binding.
The Significance of a Property Damage Release Form
- Resolution: Signing the release form signifies that the claimant has accepted the compensation offered by the insurance company and has no further claims regarding property damage from the accident. It provides a clear resolution to the property damage aspect of the incident.
- Prevents future claims: By releasing the at-fault party and their insurer from liability, the claimant cannot pursue additional claims or legal action for property damage stemming from the same accident. This helps in preventing protracted legal disputes.
- Protects the insurance company: For the insurance company, the release form ensures that once compensation is provided, they are no longer exposed to potential property damage claims related to the accident.
- Legal requirement: In many cases, signing a property damage release form is a requirement to receive compensation for property damage from the at-fault party’s insurance company.
Insurance companies are notorious for bombarding victims with forms and releases in order to quickly settle a case for much less than it is worth. Never agree to sign any documents involving an effort to combine a totaled car’s value along with a personal injury claim (where no claim for injury was yet submitted) until you have consulted with a Virginia Beach car accident attorney with our firm to ensure you are not being taken advantage of.