Created by FindLaw's team of legal writers and editors | Last reviewed October 28, 2019
This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw’s team of legal writers and attorneys and in accordance with our editorial standards.
The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area.
Last updated 10/18/2019
Many drivers only have a single vehicle and they depend on that vehicle to get to and from work, to run essential errands, and to facilitate their lifestyles. If their vehicle is completely ruined in a car accident, they will have to work with their insurance company to get their total loss claim processed.
The process of getting compensated by an insurance company for a wrecked vehicle often involves the driver giving the insurance company some form of power of attorney.
When it comes to legal, financial, and health matters, individuals are generally the only ones who can make important decisions on their own behalf. When an individual legally gives another person or entity the ability to make binding decisions for them, they are giving that entity or person power of attorney.
Many people are slightly unnerved when they see an insurance company requesting power of attorney, so it is helpful to know when an insurance company would want it.
When an insured vehicle is totaled, the insurance company is basically forced to "buy" the vehicle from the owner. The amount they pay is the amount of compensation the driver receives, minus any fees, taxes, etc.
Insurance companies ask for power of attorney in order to legally move the vehicle's title without having to get the owner's explicit permission each time the company needs to fill out a form, or so the company can sell the totaled vehicle to a salvage yard to compensate the driver.
Fortunately for vehicle owners, most states' departments of motor vehicle (DMVs) are very strict about title transfers for insurance claims. Additionally, the power of attorney granted to insurance companies is generally limited and covers only the necessary activities for fulfilling a car insurance claim.
Understanding powers of attorney and the general claims process can be difficult. If you have been in a car accident, consider speaking to an experienced legal professional for guidance throughout the process.
Contact a qualified personal injury attorney to make sure your rights are protected.
Get tailored legal advice and ask a lawyer questions about your accident. Many attorneys offer free consultations.