What loss of use damages mean and how to claim them in Tennessee
Short answer: After a wreck in Tennessee, you can seek compensation from the at-fault driver’s insurer for the reasonable cost to use a replacement vehicle (rental car or alternative transportation) or for the fair value of the time you reasonably lost use of your vehicle while it was being repaired or replaced. To make a successful claim you must document the loss, present a clear calculation of amount claimed, notify the insurer promptly, and take reasonable steps to reduce the loss.
Detailed answer — step-by-step
1. Understand what “loss of use” covers
Loss of use compensates you for the value of the vehicle’s services you could not use after a crash. Typical items covered include:
- Rental-car fees for a comparable vehicle while yours is in the shop.
- Reasonable alternative transportation costs (rideshares, taxis, public transit) if you did not rent.
- Loss of business income if the vehicle was used in a business and you can document the income loss.
- Value for the period between the crash and when a totaled vehicle would be replaced, if replacement was delayed for a reasonable time.
2. Who can claim loss of use?
The vehicle owner typically has the strongest claim. A lessee or person with legal possession may also claim loss of use if they can prove a legal right to the vehicle’s use during the loss period. If multiple people share ownership, each owner’s recovery depends on Tennessee property law and how title is held.
3. Gather strong evidence
Insurers require documentation. Collect and keep:
- Photos of damage and the accident scene.
- Police report (if any) and contact details for witnesses.
- Repair estimates and final repair invoice showing start and completion dates.
- Receipts for rental cars, rideshares, taxis, public transit, or other transport paid for because of the crash.
- If you own a business vehicle, business records showing lost income or missed jobs tied directly to the vehicle’s unavailability.
- Communication records with the at-fault insurer and your insurer (emails, letters, notes from phone calls with dates and agent names).
4. Calculate a reasonable amount
There are two common approaches:
- Direct-cost method — add actual rental or transportation receipts for the period the vehicle was unavailable.
- Fair-market method — if you did not actually rent, claim a reasonable daily rental value for a comparable car multiplied by the reasonable number of days the vehicle was out of service. Use local rental rates for similar vehicles to support your figure.
Be prepared to justify your dates (repair shop records, rental start/end dates). Do not claim for periods when you voluntarily chose not to use substitute transportation without reasonable cause.
5. Notify and present your claim properly
Steps to submit your loss-of-use claim:
- Report the accident to the at-fault driver’s insurer and your insurer as required by your policy.
- Send a written demand (email or certified mail) to the at-fault insurer including: a short factual summary, copies of documentation (repair orders, receipts, photos), and a clear demand amount with a deadline for response (commonly 14–30 days).
- If the at-fault insurer denies or undervalues the claim, provide additional documentation and ask for an explanation. Keep all written communication.
6. When the insurer refuses or stalls: next steps
If negotiations fail, you can:
- File a small-claims lawsuit or civil suit against the at-fault driver (or insurer) to recover loss of use and related property damages.
- Request mediation or arbitration if the insurer offers it or if it’s required by your policy.
- Consult a Tennessee attorney experienced in automobile/property damage claims to assess the claim’s value and next steps.
7. Important process rules and duties
- Mitigation duty: You must reasonably limit your losses (for example, look for reasonable rental options). Excessive or speculative costs will be disputed.
- Timeliness: Report the claim quickly and preserve evidence; delays make claims harder to prove.
- Proof of causation: You must show the vehicle was unavailable because of the accident, not for unrelated reasons.
How insurers commonly handle loss-of-use claims
Some insurers pay actual rental receipts up to a policy limit or for a reasonable number of days shown by repair records. Others may offer a daily rate based on fair rental value or issue a partial payment. Expect the insurer to review repair timelines and may reduce the payment if the repair shop’s time in shop looks excessive.
When to talk with an attorney
Consider legal help if:
- The insurer denies responsibility even though the other driver was clearly at fault.
- The insurer offers an unreasonably low settlement and you have documented losses that support a higher figure.
- Your loss of use includes demonstrable lost business income or other special damages that require valuation assistance.
- The opposing party or insurer raises complex ownership or liability defenses.
Useful Tennessee resource
For consumer information on auto insurance and insurer complaint processes, see the Tennessee Department of Commerce & Insurance: https://www.tn.gov/commerce/insurance.html.
Disclaimer
This article explains general Tennessee principles and common practice. It is educational only and not legal advice. For advice about a specific claim, consult a licensed Tennessee attorney.
Helpful Hints
- Begin documenting immediately: take photos, save receipts, and get repair estimates on the day of the accident or soon after.
- Keep a rental log: dates, vehicle type, daily rate and total cost; match rental days to repair shop records.
- Check your policy: your own collision/rental coverage may let you get a rental immediately while you pursue the at-fault insurer for reimbursement.
- Be realistic about vehicle equivalence: claim the cost of a comparable replacement vehicle, not an upgraded luxury model.
- When in doubt about the claim amount or legal process, ask a Tennessee attorney for a short consultation — many offer limited-fee intake calls to review documentation.