I was recently T-boned by a driver who ran a red light. The other driver lied on the scene and claimed I ran the light. My 3 week old car was on fire at the scene while I was in it. The other insurance calls me a few days accepting fault on behalf of their client. So I'm covered for the car, personal injury, loss wages, and my deductible. I have Gap insurance to cover the remainder financed portion but this still leaves me without a car or a down payment toward a new one. It doesn't seem fair since if the car was fixable all would return to the time before accident. Since it was a total loss I'm now in the negative. Can I sue the insurance for the financial pain their client has caused?

You may try, but all they are liable for is the actual value of the car. If you paid too much for it, or it lost value after you owned it, that is not their issue.

Perhaps you need to consider not settleing for their offer and asking for money money from them at this point. ** not to the point of suing yet.

You need to start looking at the value new and replacement value now. The gap should be covering with consideration of you getting the down payment back as part of your loss.