For instances where the car repairs are worth more than the worth of the vehicle, your insurance company will consider your car a total loss. In this case, your insurance company will reimburse you for the cash value of your vehicle, which is what the vehicle was worth before the loss.
As mentioned above, a car is considered totaled when the cost of repairs exceeds the market value of the vehicle. Your vehicle may also be considered if it is unsafe to drive, even with repairs.
Determining when a car is totaled varies by insurance company and by state. Every state has a threshold for determining if a vehicle is a total loss, and insurance companies can use an even lower threshold.
In Pennsylvania, a car is considered a total loss when the vehicle’s actual cash value is equal to or less than the cost of the repairs plus the salvage value. The actual cash value (ACV) is how much your car is worth immediately before it is damaged, and the salvage value is how much the car is worth after it is damaged.
Your insurance company will use the make, year, model, mileage, and physical wear and tear, as well as the damage caused to your vehicle, to determine the actual and total loss value of the vehicle. If your vehicle is in great, newer condition, you will have a higher actual value than a vehicle that is older and more worn out.
If your car is totaled, there are several steps you should take, including:
File a Claim with Your Auto Insurance
Contact your insurer and file a claim like you would with any other collision.
Have the Damage Assessed
Your insurance company will send out an adjuster to assess the damage to your vehicle. They will conduct a visual inspection of the vehicle to estimate the repair costs.
Check Your Car’s Fair Market Value
Your insurer will use the actual cash value of your vehicle immediately before your accident to determine if the car is a total loss or not. You can utilize tools such as Kelly Blue Book to get an estimate of your vehicle’s fair market value. You can also find the value of our vehicle by searching for what similar cars in your area are selling for.
Get in Touch with Your Lender
If you still have a loan or a lease out on your vehicle, you will need to inform the financing company about the damage while continuing to make your payments. Stopping payment can have a negative effect on your credit score and make it difficult to get financing for a new vehicle. After your insurance company settles your claim, they will send a payment for the vehicle to your lending or leasing company.
Negotiate with your Insurer
If you think that your car’s estimated AVC is too low, then you should negotiate the payout with them by demonstrating how your car is worth more than what they are offering.
Look for a new Car
While the payout for your totaled car won’t be enough to buy a similar one, it will be enough to make a down payment on a new car to get you back out on the road!
The highly trained technicians at Freedom Collision Center offer quality, professional collision repair services to the Morgantown area. We can help get your vehicle back in proper working order and out on the road in no time. Contact us today to learn more!
