Dealing With Flood-Damaged Cars

Can They Be Saved? And Should You Buy a 'Survivor' Car?

Among the myriad recovery issues facing people who are affected by floods, including those assailed by Hurricane Harvey and Hurricane Irma, is what happens to their cars. It's particularly critical in a city such as Houston, where cars and trucks are pretty much the only way to get around.

If you ever are confronted with the problem of a flooded car — or if you are considering buying one that is advertised as remedied or repaired — here's what you need to know. If you're concerned about being duped into buying a car that has undisclosed damage, these tips can help.

The Odds of Total Loss Are High
It's important to realize is that if your car was completely submerged by floodwater, it's likely a total loss. Estimates are that about 75 percent of affected vehicles will fall into that category.

The first thing to do is to survey the car's damage as soon as it's safe to do so, preferably with the help of an experienced mechanic. Things to look for include water pooled near the top of the engine, signs of water in the oil and transmission fluid, water in the fuel tank, and signs of flood damage toward the top of the passenger compartment. Any of these could indicate that vital components, particularly the engine cylinders and the electrical system, have experienced serious damage. Whatever you do, don't try to start the car until you get the OK from a mechanic. Doing so can cause even more problems.

Of course, almost anything can be repaired. And if your vehicle is a valuable antique or collector car, the expense may be justified, but in most cases this kind of damage means the vehicle is totaled.

Act Fast With Your Insurer
Whether your vehicle can be repaired is a determination that will need to be made by your insurance company, so review your policy to see exactly what kind of coverage you have. If your policy includes comprehensive coverage, which encompasses damage caused by wind, water and falling objects, it's likely that you'll be covered. Any cars that have been financed or leased will probably have this coverage since lenders and lease holders generally require it.

Owners of older cars, however, often decline this coverage because it's an expensive option. If that's the case with your car, then you may be on your own, but check your homeowner's or renter's policy. In some cases, it might cover disaster-related damage to your car.

If you're covered, you'll want to file your claim quickly since they're usually settled on a first-come, first-served basis. This is especially important in the aftermath of a widespread disaster such as the recent hurricanes, since insurance companies can quickly become overwhelmed. You can help move things along by taking a lot of photos or videos, paying special attention to the engine, interior, trunk and any areas that have sustained damage.

When you contact your insurer, it will want all the information available, including the vehicle's odometer reading, trim level, options, condition and your images. Then it'll take over and tell you what steps to take next. But be prepared for a long wait. After disasters such as Harvey and Irma, every insurance company is handling thousands of claims, and it may take months to get yours processed.

Stopgap Transportation
Many full-coverage insurance policies include a provision for a rental car while your vehicle is being evaluated, replaced or repaired. But if the flood is the result of a hurricane or other event where destruction is spread over many hundreds of miles, chances are that rental cars have been damaged as well. And it will likely take some time for rental companies to bring in vehicles to replace them.

You might be eligible to apply for government assistance, though. Once a disaster zone has been officially declared, as it has with Harvey and Irma, the Federal Emergency Management Agency is authorized to provide assistance. Contact FEMA to see if you qualify for help with damage not covered by your insurance company. In addition, low-interest disaster loans might be available to qualified individuals.

If you have the funds, you might consider trying to buy an undamaged used car, perhaps from an area that wasn't affected by the storm, while you wait for your insurance settlement. However, as Edmunds analysts estimated following Hurricane Sandy, which struck the Atlantic Coast in 2012, the price of used cars in affected areas jumped as much as $1,000 due to damaged dealer stock as well as interruptions in the supply chain. So you may not recoup your investment when you try to sell the vehicle.

If you're in desperate need of a set of wheels, you might try borrowing an undamaged car from a friend, joining a carpool to get to work, or signing up for a car-sharing plan. When things settle down a bit, you might also be able to rent an unaffected vehicle from an adjoining state or other area that wasn't so badly hit by the storm.

Should You Buy a Flood-Damaged Car?
You might be tempted to buy another, seemingly usable flood-damaged vehicle, either to replace your vehicle or to use while you wait for the insurance settlement. Or maybe you're an extreme bargain shopper. After any widespread natural disaster, cars that supposedly have been repaired begin appearing on the market fairly quickly. But even if you're offered a great price, should you trust such a vehicle?

There's no doubt that a good dealership or mechanic can sometimes perform miracles. But whether or not a car will make for a sound investment depends on a number of factors, the most important of which is the initial level of damage.

Relatively minor issues, such as damp carpeting and wet trunk liners, might be easy to remedy. On the other hand, they could be indications of more serious damage. So it's important to find out exactly how the seller determined that the vehicle was otherwise sound. If there were more serious problems with the car, then it's not likely that they were repaired properly since the cost would have been prohibitive.

You'll also want to know exactly what caused the damage. Was it flooded by saltwater, mud or sewage? Those can cause many more problems than freshwater flooding. If the car was damaged by a falling tree or blowing debris but was not submerged in water, it was likely much more easily repaired and would be a better bet than one that was flooded.

Other considerations include how long you'll need the vehicle and the state of your budget. Assuming the cars runs and drives normally and looks good on inspection, and you only need it for a short time while you wait for an insurance settlement, it might be worth taking a chance for the right price. But if you didn't have insurance coverage and you're replacing your ruined vehicle, you'll want to be more careful and have it more thoroughly inspected.

Also, keep in mind that if you're buying a new or almost-new car that was damaged in a flood, there's the possibility that the manufacturer's warranty has been voided. In such a case, it's definitely worth a call to verify this.