Insuring the buyback agreement against problems

Yankinwaoz

Veteran Member
Joined
Jun 17, 2005
Location
San Diego, CA
TDI
2012 Passat SE
I've been mulling the buyback deal for a few days now. I see a problem, and I'm wondering about a solution to it.

The problem is that the buyback requires that the car drive under its own power to the dealer on the day of the return. It appears that we have two years to to this.

There is no way that VW is going to be able to buyback all 500k TDi's on one day this fall. It is going to take months.

That is the risk to us owners. Between now, and the day you surrender your TDi, you can lose your buyback through no fault of your own and end up with nothing.

There are two risks:
(1) Loss of vehicle through theft or accident.
(2) Critical mechanical failure

Regarding the first. We always had that risk. That is why we pay for insurance. My concern there is that most policies pay only the replacement value of the car. I suspect that the insurance will come up with a figure that is a fraction of the buyback value. What will the insurance company use to come up with a value?

Regarding the second issue. The risk is that we would have to pay for repairs, perhaps very expensive repairs, to get the car operational again. This would significantly reduce your equity. However, this is a risk we have today.

Personally, I want to wait as long as possible. My TDi is running great. I just paid it off. I would like to have a couple of years of no car payments. I see no reason to rush my surrender.

On the other hand, I wonder if I should surrender as soon as possible to eliminate the risks outlined above. If I bought a new car right away under warranty, then the risks are gone. But then I will be saddled with a new car payment that I didn't want.

I wish there was a way I could insure the risks. I know that an "extended warranty" is a total scam and worthless for risk #2.

For risk #1, I can't seem to get a straight answer from my insurance company about what the payout would be if my car was stolen or totaled. I don't think that the auto insurance companies have any products that deal with this unique situation.

So my question is: Has anyone managed to find insurance that will mitigated the risks described above?

Thanks
 

speedrye

Veteran Member
Joined
Jul 27, 2016
Location
Central NC
TDI
13 JSW DSG, 14 JSW DSG
I don't know that insurance is a big problem. Sure, they might only pay you $14k for a $20k buyback car, but that means you can still buy a similar car on the used market for $14k. If you can't, you need to renegotiate your insurance payout. Go buy another car and turn it in for the buyback. You'd take a small hit on only getting a portion of the restitution payment, but the tax and other stuff should all be a factor in the insurance payment.
 

autdi

Veteran Member
Joined
Nov 11, 2004
Location
Alabama
TDI
2000 NB, 2003 NB, 2006 Touareg, 2015 Jetta, 2015 Jetta
I don't know that insurance is a big problem. Sure, they might only pay you $14k for a $20k buyback car, but that means you can still buy a similar car on the used market for $14k. If you can't, you need to renegotiate your insurance payout. Go buy another car and turn it in for the buyback. You'd take a small hit on only getting a portion of the restitution payment, but the tax and other stuff should all be a factor in the insurance payment.
Also, after 9/16/16 there is the non-operational vehicle owner compensation. Basically a totaled vehicle payoff. You get the modification compensation part, but don't get the pre-scandal car price.

c. For a Class Member who owned an Eligible Vehicle that was totaled and who consequently transferred title of that vehicle to an insurance company after the Opt-Out Deadline, but before the end of the Claim Period, Owner Restitution is equal to the Owner Restitution for an Eligible Owner under ¶ 5(a).
 

2015vwgolfdiesel

Top Post Dawg
Joined
Jan 1, 2016
Location
Oklahoma
TDI
2015 VW Golf S DSG Silver
I've been mulling the buyback deal for a few days now. I see a problem, and I'm wondering about a solution to it.
The problem is that the buyback requires that the car drive under its own power to the dealer on the day of the return. It appears that we have two years to to this.
There is no way that VW is going to be able to buyback all 500k TDi's on one day this fall. It is going to take months.
That is the risk to us owners. Between now, and the day you surrender your TDi, you can lose your buyback through no fault of your own and end up with nothing.
There are two risks:
(1) Loss of vehicle through theft or accident.
(2) Critical mechanical failure
Regarding the first. We always had that risk. That is why we pay for insurance. My concern there is that most policies pay only the replacement value of the car. I suspect that the insurance will come up with a figure that is a fraction of the buyback value. What will the insurance company use to come up with a value?
Regarding the second issue. The risk is that we would have to pay for repairs, perhaps very expensive repairs, to get the car operational again. This would significantly reduce your equity. However, this is a risk we have today.
Personally, I want to wait as long as possible. My TDi is running great. I just paid it off. I would like to have a couple of years of no car payments. I see no reason to rush my surrender.
On the other hand, I wonder if I should surrender as soon as possible to eliminate the risks outlined above. If I bought a new car right away under warranty, then the risks are gone. But then I will be saddled with a new car payment that I didn't want.
I wish there was a way I could insure the risks. I know that an "extended warranty" is a total scam and worthless for risk #2.
For risk #1, I can't seem to get a straight answer from my insurance company about what the payout would be if my car was stolen or totaled. I don't think that the auto insurance companies have any products that deal with this unique situation.
So my question is: Has anyone managed to find insurance that will mitigated the risks described above?
Thanks
Feeling the same as you, but mostly over the insurance part regarding a totaled car. Not even going to call my SF agent because think it is a waste of my time.

The good point in my situation is low miles and having a 3 year and 36,000 miles original warranty

Best of luck to you:)
 

RollingCoal

Veteran Member
Joined
Nov 4, 2015
Location
Md
TDI
2015 Golf Tdi SEL
As mentioned above you are covered after 9/16 against a total loss. Mechanical failure is still on us though so if you have a higher mileage car I would try to get it turned in as quickly as possible or park it until they schedule your buy back which may be an option for people with an extra vehicle.
 

2015vwgolfdiesel

Top Post Dawg
Joined
Jan 1, 2016
Location
Oklahoma
TDI
2015 VW Golf S DSG Silver
As mentioned above you are covered after 9/16 against a total loss. Mechanical failure is still on us though so if you have a higher mileage car I would try to get it turned in as quickly as possible or park it until they schedule your buy back which may be an option for people with an extra vehicle.
Wonder if one might even be able to turn it in (park it) NOW -- at a dealership with the understanding that it did get there under its' own power?

Just a thought, for those with a seriously limited car:)
 

Rico567

Top Post Dawg
Joined
Jun 13, 2003
Location
Central IL
TDI
2013 Passat TDI SEL Premium (Turned in 7/7/18)
Wonder if one might even be able to turn it in (park it) NOW -- at a dealership with the understanding that it did get there under its' own power?
Just a thought, for those with a seriously limited car:)
So— in this scenario, the dealer assumes whatever liability is involved for having the car parked there (it comes under their insurance umbrella, right?), and that doing this actually works within the settlement language, mainly that VW is going to buy doing this (remember that a dealer and VW are not the same thing). This may be something that flies, but I doubt it based more on the first part. Let's say I'm a dealer, and someone puts it to me that they want to leave their car on my lot from now until, say, 31 December 2018, and since it drove in today, that makes it legit 2.5 years from now. I think the dealers would fall into two categories: one would say "That's $XX per month for storage," and the other that would laugh in your face.
 

uncle fishhead

Well-known member
Joined
Jun 29, 2016
Location
Dallas Area
TDI
2012 Golf
It's worth considering a few things.

First off, with almost any vehicle.....if it's totaled you may not get what you want from your insurance. So this isn't a risk unique to the TDIs. If I take the buyback, buy a new car, and total it 3 months later.....I will also lose money from that event.

Second, after the "opt out" date, if you get totaled, you get the insurance and still get restitution. So you're still better off with this car than any other (including any conceivable replacement vehicle) in the event of a "total".

Third, there's an offsetting opportunity. If you are in an event that results in a settlement from insurance, you may get that amount and still be able to do the buyback. Let's say you get 1.0" hailstones that fall in your driveway. The roof and hood are beat up, but the car is still eligible for the buyback. Perhaps insurance pays you 3-5K ..... you make out like a bandit.

Seems to me that life is risky and you can't insure against everything. I also think it's odd that we're all at risk right now, since we can't event get restitution for a "total" prior to the opt-out date. But you can't do much about that except to drive carefully (or park the car).
 

bubbagumpshrimp

Veteran Member
Joined
Jul 12, 2013
Location
Virginia
TDI
'13 Jetta TDI
Wonder if one might even be able to turn it in (park it) NOW -- at a dealership with the understanding that it did get there under its' own power?
Just a thought, for those with a seriously limited car:)
Yes...I'm sure that dealerships would be interested in storing yet-to-be bought back TDI's for the price of "on the house" and assuming liability for storing said vehicles until this gets resolved.:rolleyes:
 

senez

Veteran Member
Joined
Dec 20, 2007
Location
Raleigh, NC
TDI
15 Passat DSG
Here's another rub...let's say you total it, but also have the new car replacement coverage. Usually the way this works is they'll call up the dealer and price out the same car and give you the difference in their valuation and the new car price. In our scenario, you can't buy a comparable vehicle, so how would that work?

But I get your tentative feelings. I'm leaning towards the fix, now, but it's scary given that there's no timeline. With a 2015, I figured it would be first in line, but who knows?
 

Mark SF

Veteran Member
Joined
Sep 19, 2015
Location
SF Bay Area
TDI
2013 Passat TDi
The way I see it, if I have a serious enough accident that the car is totaled, and I am still around to lose money afterwards, I should be grateful to be alive.

My approach to the problem is that I leased a new car at the weekend. The Passat is parked until the buyback. It's unlikely to get totaled or stolen, sitting in the garage. It's not impossible, but it's certainly not likely.
 

gmcjetpilot

Veteran Member
Joined
Aug 18, 2008
Location
Memphis TN
TDI
2010 JSW TDI DSG Matalic Grey
Life is full of risk... manage it, make your choices, accept the
results. You have similar risk keeping your VW TDI or buying
a new car. An accident or catastrophic mechanical will cost
you.

A new car will be under warranty, you will pay more (car
payment, interest) and deprecation which all cars experience,
especially steeper depreciation in first 4-5 years. My car is
5-6 years old and has been depreciated.

Keeping your car regardless of VW buyback is really irrelevant.
You have it insured right? If you love the car, want to drive it
for longer keep it. Of course buyback is better than insurance
settlement... again a choice.

The $5000 they are dangling in front of me is not enough to
sell outright. $5000 + fix I will consider. Fix not forthcoming
I'll opt out by Sept 2018. I want to be one of the 15%
(~70,000 TDI's are allowed to drive at least per the deal, 85%
must be fixed or off road in USA).

I will drive for another 10 years with my $1000 good will money,
half of which I bought filters and oil for another 30K of driving.
I bet many TDI owners will sell back and post here their remorse.

The VW deal is fair, and if you want out, take it and move on.

I just did a 1470 mile round trip last week/weekend. Driving
+70mph, AC on I averaged 42 mpg. The car was amazing as
usual, comfortable, lots of entertainment, and when I need to
pass or accelerate I had the power (thank you torque). One
night I needed to crash in my car... back seats down, camping
mattress, pillow, slept like a lamb. Saved me $140 hotel stay.
That paid my fuel over x2. Yea for car camping. People talk of
hyper miles, but saving $140 pays for a lot of fuel.
 
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jblondin

Active member
Joined
Oct 8, 2015
Location
atlanta
TDI
2015 Golf Sportwagen
Get an estimate from your insurance company

I have the same concerns as the OP. I think if you are in a newer model year the spread for the insured value of your car vs the proposed buyback is much larger. I have a 2015 JSW with a buyback of $30,500. The insured replacement value is somewhere in the 15k range. So if the car is totaled, id get the 15k payout from insurance, and the 7300$ from VW for fraud settlement. So im basically playing roulette with 7500$ roughly. The market for 2015 cars is non existent, so proving you are owed more is not gonna happen. Also, if you keep the car for two more years your depreciation will continue, widening the gap between VW settlement and insurance payout. For me, its not worth the risk. I would take the payout ASAP and then buy something comparable to your current model year in another brand. Something that holds its value. You should be able to pocket some extra change if you shop right to cover any unexpected surprises maintaining another car. Dont fall for the new car is without flaws our issues crap. I would much rather have a gently used car that has had all issues fixed and pay a discount.
 

ecupip

Well-known member
Joined
Jun 27, 2016
Location
Somewhere
TDI
2012 TDI
Greatest rewards come with high risk. Depends on the type of person you are and what you are comfortable with.

There is a lot of talk about totaling the cars, but how often does that actually happen? People have accidents everyday, but it is rare for such a catastrophic event as a totaled vehicle. I've been driving for 20+ years and have had only one minor accident.
 

jblondin

Active member
Joined
Oct 8, 2015
Location
atlanta
TDI
2015 Golf Sportwagen
Greatest rewards come with high risk. Depends on the type of person you are and what you are comfortable with.

There is a lot of talk about totaling the cars, but how often does that actually happen? People have accidents everyday, but it is rare for such a catastrophic event as a totaled vehicle. I've been driving for 20+ years and have had only one minor accident.
Murphy's Law. If youre willing to take the risk, rock on. So totalling a car is a pure value analysis. If the insurance company values your car at 15k, if the damages exceed 50% of the value they total it. So it wont take much with todays cars, deployed airbags, damaged HID lights, etc to total a car on paper. The risk in this scenario has already been realized, our cars are now fully depreciated, sales have stopped, and there is really no replacement in sight.
 

jblondin

Active member
Joined
Oct 8, 2015
Location
atlanta
TDI
2015 Golf Sportwagen
Greatest rewards come with high risk. Depends on the type of person you are and what you are comfortable with.

There is a lot of talk about totaling the cars, but how often does that actually happen? People have accidents everyday, but it is rare for such a catastrophic event as a totaled vehicle. I've been driving for 20+ years and have had only one minor accident.
And just out of curiousity? What is the delta between your buyback amount, and your cars current insured value? Im willing to bet you are much tighter being in a 2012 car vs a 2015. So it makes more sense for you to continue to drive. It does not for newer models due to the severe depreciation.
 

r11

Veteran Member
Joined
Mar 6, 2012
Location
NJ
TDI
2012 Passat TDI SE 6MT (BB'd), 2015 Passat TDI SE 6MT
I keep saying that totaling a TDI is the ultimate solution to a "polluting" car problem. Thus not only should you be entitled to the buyback amt, there should be a small premium too :)
 

uncle fishhead

Well-known member
Joined
Jun 29, 2016
Location
Dallas Area
TDI
2012 Golf
I've been looking at the "5 year ownership cost" for a few new cars of late (KBB or cars.com). They can show you estimated costs for everything, year by year.

You should check out the first year depreciation on just about any car, if you think moving to another vehicle will protect you better against an accident that totals the car you're driving. Yikes. The two that I'm looking at are ~$8K and (double yikes) (~$17K). If my TDI gets totaled in October, I'll be out perhaps 2 or 3K from insurance and restitution. If my replacement car gets totaled 6 months down the road...I'll be out way more than that.
 

roni024

Veteran Member
Joined
Mar 31, 2007
Location
Syracuse, NY
TDI
2015 Passat TDI SEL DSG
If I recall correctly, the settlement has language stating that if you receive the fix and restitution but are not happy with the car's performance post-fix, you can still sell it back to VW for the buyout amount minus the restitution you previously received. When the fix is performed on the vehicle, an extended warranty is also activated, which covers pretty much all the tender areas of these cars: HPFP, turbo, DEF system, DPF, etc. I'm planning on getting the fix done as soon as possible, having the fix "fixed" shortly thereafter (leaving the DPF installed/intact), and considering selling the car back when we near the end of the allowable timeframe to do so.
 

DanB36

Veteran Member
Joined
Jul 13, 2003
Location
Savannah, GA
TDI
2014 Q5 Prestige TDI, Monsoon Gray
If I recall correctly, the settlement has language stating that if you receive the fix and restitution but are not happy with the car's performance post-fix, you can still sell it back to VW for the buyout amount minus the restitution you previously received.
No, not really. The closest provision to this is the lemon law-like section in the extended warranty. The warranty provisions start on page 25 of the FTC Consent Order; the "lemon law" section starts on the bottom of page 28. In short, if the dealer can't repair a covered problem within four visits or thirty days within 18 months after getting the fix, VW has to offer a buyback. But it's specifically tied to failures of parts covered under the extended warranty (which is quite a long list), not simply dissatisfaction with the way the car drives after the fix.
 

ecupip

Well-known member
Joined
Jun 27, 2016
Location
Somewhere
TDI
2012 TDI
And just out of curiousity? What is the delta between your buyback amount, and your cars current insured value? Im willing to bet you are much tighter being in a 2012 car vs a 2015. So it makes more sense for you to continue to drive. It does not for newer models due to the severe depreciation.
Oh I am not. She's going back as fast as it came into my life, LOL. I recently started traveling more for work and bought it as a car to rack up miles on while getting great fuel economy. I paid $8,600 for it and they will buy it back for $16,000. I am a risk taker, but I do not see the benefit of the high maintenance cost and racking more miles up to take the buy back years later....driving 2,500-3,000 miles/month now.

No clue what the delta is on the insured amount versus the actual value, but I do know when I registered the car in NC the tax value was $16,000.

I was going to look at a replacement, possibly a cruze diesel or accord hybrid, but I've made up my mind and will just start racking them up on my Ram ecodiesel to save the extra cost of insurance and maintaining 2 vehicles. I was hoping to get around 50MPG on the highway in the TDI, but the road I travel and the headwinds I fight everyday limits me to 38-40MPG max...thats ruffly 10MPG less than my big, comfy, 4X4 truck. If the TDI can't get it I doubt there is another car out there that would beat the 10MPG delta. It'll only cost me $50/month more in fuel, but I will save more by only having the 1 vehicle.
 
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jblondin

Active member
Joined
Oct 8, 2015
Location
atlanta
TDI
2015 Golf Sportwagen
Oh I am not. She's going back as fast as it came into my life, LOL. I recently started traveling more for work and bought it as a car to rack up miles on while getting great fuel economy. I paid $8,600 for it and they will buy it back for $16,000.
So ill bet your book value is somewhere in the 6-7k range. So if totaled you would get that, and the 5k restitution payment. So you are risking 12k vs 16k, or a difference of 4k. For me, that would be more reasonable. My delta is double that.
 
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