What is the name of your state (only U.S. law)? Oklahoma
Our policy has replacement cost and I am working with my insurance company on a personal property claim due to lightning strike that damaged our home theater receiver....among other things. The item is no longer available. My insurance company uses a third party to value claim items and they specified a current model that is comparable in features. Fine so far. However they put the replacement cost at $480 and the item is listed at all online retailers I checked for $800. I talked to manufacturer of the receiver and they say that price is below cost even if you went to Japan directly. I have talked to the third party company and they say that they are an authorized dealer and that the price is only available to them for insurance claims. They can provide the replacement receiver to me if I am willing to wait (it's back ordered) or I can get something else and be paid based on their amount that is not available anywhere else and appears to be below cost. My question: Does my insurance company have to base the replacement cost on published prices available to the general public or can they use a sole source that is a direct subcontractor to the insurance company? This seems like the automobile scenario where the insurance company wants you to have your car repaired at their approved shops....which you do not have to do. However, I am not sure if the company is only obligated to pay what the approved shop would charge if I choose to take it to the dealer. I may be mixing apples and oranges but this seems a bit shady and a great way for the insurance companies to keep claims lower. Thanks in advance!!!!!
Our policy has replacement cost and I am working with my insurance company on a personal property claim due to lightning strike that damaged our home theater receiver....among other things. The item is no longer available. My insurance company uses a third party to value claim items and they specified a current model that is comparable in features. Fine so far. However they put the replacement cost at $480 and the item is listed at all online retailers I checked for $800. I talked to manufacturer of the receiver and they say that price is below cost even if you went to Japan directly. I have talked to the third party company and they say that they are an authorized dealer and that the price is only available to them for insurance claims. They can provide the replacement receiver to me if I am willing to wait (it's back ordered) or I can get something else and be paid based on their amount that is not available anywhere else and appears to be below cost. My question: Does my insurance company have to base the replacement cost on published prices available to the general public or can they use a sole source that is a direct subcontractor to the insurance company? This seems like the automobile scenario where the insurance company wants you to have your car repaired at their approved shops....which you do not have to do. However, I am not sure if the company is only obligated to pay what the approved shop would charge if I choose to take it to the dealer. I may be mixing apples and oranges but this seems a bit shady and a great way for the insurance companies to keep claims lower. Thanks in advance!!!!!