A woman whose car was totaled in a collision is warning others about the dangers of relying on insurance company third-party appraisers after the crash led to a nearly seven-year saga.

“This has been a nightmare,” Meliha Jusupovic told Repairer Driven News of the series of events triggered after her car was rear-ended in Seattle on July 29, 2016.

Following the crash, her Hyundai Elantra was towed to Haury’s Lake City Collision, where the damage was documented at $10,236, according to a legal filing. The cost to repair the car exceeded its value, meaning the vehicle appears to have been a total loss.

It was expected that the next step in the process would be for the insurer to take the vehicle or for Jusopovic to buy it back and receive a salvage title.

According to Washington law RCW 46.04.514, “salvage vehicle” means a vehicle whose certificate of title has been surrendered to the department under RCW 46.12.600 due to the vehicle’s destruction or declaration as a total loss. Or, for which there is documentation indicating that the vehicle has been declared salvage or has been damaged to the extent that the owner, an insurer, or another person acting on behalf of the owner, has determined that the cost of parts and labor plus the salvage value has made it uneconomical to repair the vehicle.

Despite the car appearing to be a total loss, Jusopovic’s insurer Integon Preferred Insurance Company hired Nationwide Appraisals LLC to oversee another inspection. Nationwide then hired an independent appraiser, Ron Shugar with Lighthouse Estimates, to conduct the appraisal. According to a legal filing, Shugar’s business is “unlicensed and unauthorized” in the State of Washington.

Shugar estimated the damage to be $5,383.37, with Integon deciding the car should be repaired for that amount, disregarding the damage analysis from Haury’s Collision.

“On August 25, 2016, Integon informed [Jusupovic] that it would pay the amount of Ron Shugar’s appraisal,” a legal filing says. “It should be noted that Integon had the power to approve, disapprove, and change the Shugar appraisal estimate per testimony by one of Nationwide’s witnesses in this case.

“In fact, a witness from Nationwide testified that Mr. Shugar used National General Guidelines in his appraisal of the Plaintiff’s vehicle.” However, those appraisal guidelines were not provided.

Jusupovic hired her own public insurance adjuster, Mike Harber, who agreed the vehicle would be too costly to repair. The public adjuster filed a dispute with Integon, which hired SCA Appraisal Company to take another look. This time, the estimate came in at $9,948.41, prompting Integon to deem the vehicle a total loss.

However, the story didn’t end there.

Because about three months had passed between the time of the crash and the property damage settlement, Jusopovic’s car had sat on Haury’s lot the entire time, accumulating about $10,000 in storage fees, as well as inspection and teardown costs which Integon refused to pay.

Haury’s owner, Jeff Butler, said the insurance company tried to blame his repair facility for the problem and that his shop should have sent “a proper supplement” to Integon and/or its appraiser. Butler stated his shop sent Integon and their appraiser their accurate damage assessment at least six times but it was ignored. Ultimately, Integon refused to pay almost all of the storage bill.

Butler said he later learned that Integon was attempting to settle the claim through forced owner retention, meaning Jusupovic was forced to keep the salvage car as opposed to Integon Insurance taking the vehicle to a salvage lot.

“[Insurers] sometimes will try to force the salvage retention on their insured,” Butler told RDN. “She didn’t want it but they rammed it down her throat to make her eat the storage charges. So, both Integon and Jusupovic effectively abandoned the car on our property, but the [storage] bill was too big for her to pay. She didn’t have the funds as she was in school at the time.

“Abandoning salvage on property is a violation of Washington law,” Butler said. “But Integon didn’t seem to care to follow those rules either.”

The case hit yet another snag when the insurance company branded the title to Jusupovic, but transferred the title in their own name as well, Butler said.

“Integon said it was an owner retention,” he said. “And so the Department of Licensing (DOL) had both of those designations on the title and the DOL wouldn’t release the title to Jusupovic or Haury’s Collision. It took the insurance company calling the DOL to get the title fixed. They just refused to do it for more than six years even though I asked them for it.”

For the entire time, the Elantra remained on Butler’s lot, amassing about $165,000 in storage fees dating back to 2016.

Jusupovic told RDN that, to date, Integon hasn’t paid anything toward the storage fees despite the original estimate by Haury’s that the car was totaled, as confirmed by the second appraiser Integon hired.

“If somebody makes a mistake, as Integon did here, and they are informed of their mistake as they were by SCA then they need to own up to their mistake and pay for the storage fees they allowed to be amassed as they waited for their second appraisal to correct the first wrong appraisal,” she said. “Instead, Integon dropped the ball on its own insured to take care of the problem while at the same time tying her hands in being able to take care of the problem by putting two conflicting indicators on the title of the car, thus clouding the title. This type of behavior by Integon needs further scrutiny by the Washington Insurance Commissioner and I intend to draw the commissioner’s attention to it as soon as this trial wraps up.”

Jusupovic is suing Integon and Nationwide Appraisals to reclaim storage costs and other expenses related to the case, with the trial set to begin this spring. She previously sued Shugar but lost that case in 2020, with the court finding Shugar “owed no duty” to her as an independent appraiser.

For Butler, the nearly seven-year ordeal should serve as a warning to other repair shops about the consequences if they were to rely on third-party appraisers.

“The court ruling stated that the independent adjuster hired by Nationwide Appraisals has been ruled to have no duty to the consumer or the repair shop,” Butler said. “So then why the heck would you ever let these people in your facility or waste any energy speaking with them or try to negotiate with them?”

Butler said insurance companies began using third-party appraisers far more frequently around the time the pandemic struck after firing their own staff appraisers to limit their overhead but most of those third-party appraisers only perform virtual inspections.

“Now, many insurers are trying to shift the duties of the claims investigation and costs to the shops but refuse to pay for the shops’ time for this work even though the insurers demand the shops do the inspection work that is ultimately the responsibility of the insurer,” he said. “It seems like a majority of insurance appraisers or the third-party ‘independent’ appraisers are not qualified subject matter experts with regards to vehicle repairs.

“Many of these so-called appraisers are just insurance-trained hackers that happen to have a software subscription. In my experience, many of these [third-party appraisal] companies are a joke. There are no ethical or training standards for those companies that I’m aware of. They have no rules. But insurance companies are using them to write appraisals and many shops still think they’re supposed to be working from these appraisals and ‘negotiating with this third party.'”

Butler said that this case clarifies an important point that should ring loud and clear for shops.

“Stop dealing with these third-party entities that have no duty of good faith to your customer and are not qualified subject matter vehicle repair experts,” he said. “Third-party appraisers have no responsibility to your shop or your customer, they only exist to drive your prices down and distance the insurance company from liability in my opinion.”

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