You were in an accident and your car has been determined a total loss.  How is this determined?

Insurance Carriers look at three different things to determine if a vehicle is a total loss or not:

1) What is the vehicles's actual cash value (ACV) vs. the cost to repair the vehicle?

Every vehicle has an actual cash value, and the insurance adjuster compares this cost to the cost of repairing the vehicle.  In order to arrive at your vehicle's ACV, insurance carriers use information like mileage on your car, condition of the car, and will frequently consult the National Automobile Dealer Association (NADA) and Kelly blue Book.  If the cars actual cash value is lower than the amount it costs to repair the vehicle, sometimes even a certain percentage of, the car will be determined a total loss.


2) Can the Vehicle Be Repaired to Pass All Safety Standards?

Cost is probably the biggest consideration when determining if a vehicle is a total loss, but not the only consideration.  The vehicle needs to be repaired to meet all safety standards to be cleared for the road again.  Not all vehicles can be repaired to meet these safety standards.

3) What Does The Law Say?

The insurance carrier isn't the only one who determines if an auto is deemed a total loss.  They also have to abide by state laws regarding vehicles involved in accidents.


What to Do After Your Car is Declared Totaled

If you are not at fault for the accident, you most likely will not need to pay for anything.  If the accident was your fault, you will need to pay your deductible prior to insurance covering any damages.  If the coverage you have for the vehicle is liability only, you will not receive any help from the insurance carrier in fixing damages to your vehicle.

A transfer of ownership will be required for the insurance carrier covering the claim.  After this transfer of ownership, you will receive a settlement check on an agreed amount.  You will want to maintain liability insurance on this vehicle until it is officially no longer titled in your name.

After a total loss, you might need a rental car.  In this situation, if you were not at fault, the other insurance carrier will usually pay for a rental car for a specific number of days.  Beyond that you will need to use the settlement check to either pay off an existing loan on the totaled car or use it to purchase a new car.


Having your car totaled can be financially devastating.  To learn more about having the right insurance coverage call Wessell Insurance Services, LLC at 1-866-663-7561.  
Posted 3:23 PM

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