Question: My insurance said I have to sign the power of attorney before I’ll be paid the value of the vehicle. Is this normal? Do I need a lawyer?
Answer: When you total your car, the insurance company will take possession of it so that they can compensate you and dispose of it. To do this efficiently, most insurance companies require you to sign an agreement giving them power of attorney.
Granting power of attorney gives somebody else the ability to make decisions on your behalf. It can be used in various contexts, such as financial, legal, and health matters.
When it comes to a totaled car, the power of attorney document lets the insurance company decide what to do with the car wreck without having to ask your permission. Power of attorney privileges granted in these cases are generally limited in their scope to what’s necessary for the car insurance claim to go through.
Geico power of attorney example
To give an example, let’s look at GEICO’s power of attorney form, which has two sections.
The first is a “Bill Of Sale – Power Of Attorney.” This section requires you to list your car’s details like year, make, model, serial number, and odometer reading. You will need to agree to the following paragraph:
“To have and to hold all and singular the said goods and chattels to said grantee, its successors and assigns. The undersigned covenants with said grantee that the undersigned is the lawful owner of said goods and chattels, that they are free from all encumbrances, that the undersigned has a good right to sell the same; that the undersigned will warrant and defend same against the lawful claims and demands of all persons.”
While it sounds complicated, it essentially means that you’re giving the insurer possession of your car.
The second section is a “Power of Attorney” section, where you grant GEICO the ability to make decisions on titles issued by your state’s DMV on your behalf. You’ll need to fill out many of the same car details as in the first section, and you’ll need to sign again. Make sure your signature matches the way your name appears on your car title.
Though you can consult a lawyer before signing over your car, be aware that this is standard practice for insurance companies dealing with totaled vehicles. Completing the paperwork will help your insurance company do their job, which is helping you get over your car wreck, financially and practically.
Xuyun Zeng is a content strategist with a wide-ranging content background including tech, journalism, cars and health care. After graduating with highest honors in journalism, Xuyun led a newspaper to win eight awards, helped start an award-winning film industry podcast and has written over a hundred articles about cars repair, state laws and insurance. Prior to joining Jerry, Xuyun worked as a freelance SEO consultant with a mission to create the best content that will help readers and grow organic traffic.
Alice Holbrook is an editor with more than a decade of experience covering personal finance, including car insurance. She\’s passionate about creating easy-to-understand content that demystifies intimidating topics for readers. Previously, she worked for NerdWallet, and her work has been featured by Newsweek, The Washington Post and the Associated Press, among others.
