Loss of Use – The Property Claim You May Not Know About

If you are involved in a motorcycle accident or a car accident through no fault of your own then your motorcycle or car is probably damaged or you have a claim for your motorcycle total loss or car total loss.  If so, the property claim Loss of Use may be available to you.  Here is how a Loss of Use claim works when you have been involved in a collision through no fault of your own.  At some point your motorcycle or car is not drivable, and you will be without your vehicle. It could be that your motorcycle or car is a total loss, and you are going to be without a vehicle from the date of the collision until you are paid for the total loss.  It could be that your vehicle is repairable, but it is not drivable due to the damage and you will be without your vehicle from the day of the collision until you get your car back after repairs.  It also could be that your car is drivable and repairable, but you will be without your car for the time that it is in the body shop being repaired.  In the majority of these situations, the individual gets a rental car from the insurance company of the driver at fault or through their own insurance company (see the blog I posted on October 19, 2020).  But, what if you did not get a rental car for some or all of the days without the use of your vehicle.  That is when the claim for Loss of Use comes into play.

Over the years I have made many, many Loss of Use claims on behalf of my clients as their motorcycle accident lawyer or car accident lawyer.  As the client’s motorcycle accident lawyer or car accident lawyer, I will handle any of their motorcycle property damage claims or car property damage claims at no extra charge, including any claims for Loss of Use (my attorneys’ fees are based on a percentage of the recovery for the personal injury claim when it is resolved).

Claims for Loss of Use are generally made with the insurance company of the driver at fault.  A claim for Loss of Use can also be made with an individual’s own insurance company, but only in connection with making either an underinsured property damage claim or an uninsured property damage claim.  You would make an underinsured property damage claim if the driver of the person responsibility for the damage to your vehicle does not have enough property damage liability coverage to pay for the extent of your property damage claims arising out of the collision.  You would make a claim under your uninsured property damage coverage if the driver of the vehicle responsible for your collision has no insurance and you can identify who that driver is.  You cannot make an uninsured property damage claim in a hit-and-run situation where the driver at fault is never identified.  A claim for Loss of Use is fault based and cannot be made under the collision portion of a car insurance policy or motorcycle insurance policy.

When I calculate a client’s claim for loss of use, I first look at the number of days that they are without the use of their vehicle.  Here is how that calculation works based on most common the scenarios which give rise to a loss of use claim.

You Do Not Get a Rental Car Until a Few Days After the Collision

There are many times an individual is in an accident but is not able to pick up a rental car until a few days after the collision occurs, and it is for those days that a claim for loss of use can be made.  For example, if you are involved in a collision on a Monday night and you do not get a rental vehicle until Thursday morning, your Loss of Use claim is for 2 days.

The Insurance Company Never Offers You a Rental Car

There are many times in which the insurance company of the other driver accepts responsibility for the collision by indicating their driver was at fault but that decision was not made until a couple days or even a few weeks after the collision.  This generally occurs when the insurance company has to conduct an investigation to determine who is at fault in the accident.  The insurance company will need to get a copy of the accident report, talk to their driver and talk to any witnesses.  During the time of investigation, the insurance company will probably not provide a rental car.  It is this scenario that often drives an individual to have their own insurance company handle the claim for the damage to their motorcycle or car.  If that occurs, and this individual does not have rental coverage, then a claim for loss of use can be made if the driver at fault ultimately accepts responsibility for the collision.  For example, if it takes 2 weeks for the insurance company to accept responsibility for their driver’s actions, and they then indicate they will supply you a rental car until the total loss of your vehicle has been resolved or your vehicle has been repaired.  The Loss of Use claim is for 14 days.

You Have an Extra Vehicle in the Household and You Do Not Want a Rental

When this scenario occurs, you still will be without the use of your motorcycle or car for some period of time.  Let’s assume your motorcycle or car can be repaired but is not able to ride or drive. It you get back your repaired motorcycle or repaired car 30 days after the collision then the Loss of Use claim is for 30 days.

Your Injuries Prevent you from Driving a Rental Car

There are times in which unfortunately I have clients that have been seriously injured and are physically not able to drive a rental car.  Most often this occurs with my motorcycle accident clients.  In this situation no rental car is supplied because a seriously injured individual cannot drive it.  Under this scenario, let us assume that the motorcycle or car vehicle is a total loss, and the total loss claim is resolved 16 days after the collision.  The Loss of Use claim would be for 16 days.

Once I have established the number of days for the client’s Loss of Use claim, I then calculate the total amount of the Loss of Use claim by multiplying the number of days without a vehicle by the appropriate daily rate.  The amount of the daily rate is the cost of renting a similar vehicle.  If a “similar vehicle” is a passenger car, then I look up how much it would take to rent a similar car from a local rental company, such as Enterprise.  What happens, though, when making a claim for the loss of use of a motorcycle – wouldn’t a similar vehicle be a motorcycle?  I am going to get to that question, but will first discuss the cost of renting a motorcycle.

First of all, there are not very many dealerships that rent motorcycles.  I know that Carolina Coast Harley-Davidson in Wilmington, North Carolina does rent motorcycles, but it is very expensive.  For example, you can rent a Harley-Davidson Softail Deluxe or Ultra Limited for $140.00 per day (if you are renting 7+ days).  See carolinacoasthd.com.  You can typically find cheaper rentals through the website of riders-share.com.  Riders Share is a peer-to-peer motorcycle rental community whereby you find motorcycle owners in a particular area who are willing to rent their motorcycle out.  I recently looked on the website and found an individual renting out a 2008 Harley-Davidson Heritage Softail Classic for $71.25 per day with a 5-day minimum.  So, if an individual rented this motorcycle for 21 days, then the cost would be about $1,500.00.

As you can imagine, the amount of a Loss of Use claim for a motorcycle based on the rental rate of an actual motorcycle can be a high figure.  Because of the potential size of Loss of Use claims for motorcycles, insurance companies will often agree that if they did supply a rental vehicle to a motorcyclists their responsibility would simply be to provide them with reasonable transportation that would get them to and from places and that would be a car and not a motorcycle.  There has never been a legal case brought in North Carolina that has decided the issue of what constitutes a similar vehicle to a motorcycle in connection with a claim for Loss of Use – is it a motorcycle or any mode of transportation that gets them to and from a place such as a car.

If you have been involved in a motorcycle accident or car accident and would like to discuss any property damage claim that you may have, including any claim for Loss of Use, please give me a call.  There is always a free consultation in connection with discussing your accident and any claims that you may have.

Gary Poole – North Carolina Motorcycle Accident Lawyer and North Carolina Car Accident Lawyer




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