If you do not want your vehicle totaled and the repair costs are near the lower end of the total loss threshold you can ask your insurance company to pay for the repairs. Most often a totaled vehicle will be auctioned off to a salvage.
A total loss in car insurance is a term insurers use when the cost to repair your car is more than the value of the vehicle.
When insurance totals your car. Once an insurance company has determined that your vehicle is totaled you have the option to accept the settlement offer or try to negotiate a higher amount. The claims journal noted that an insurance company might declare a car totaled if repairs are 3 000 and the vehicle is worth 4 000. If the insurance company totals your car it will pay you the car s actual cash value minus your deductible and your car is then sent to a salvage yard to be auctioned off to the highest bidder and usually chopped up for parts.
It s auctioned off to a salvage yard. When you ve been involved in an accident that has damaged your vehicle the insurance company will assess the damages to decide if it s worth repairing. When your car is totaled one of two things can happen.
However progressive insurance notes that a common threshold is when repair estimates exceed 80 percent of the market value of the car. When a settlement has been paid based on a totaled vehicle s acv and the insured party either buys a replacement vehicle or leases one within 30 days the insurer must pay the sales tax. Insurance companies typically classify a vehicle a total loss when the cost of repairs reaches a certain percentage usually between 75 and 85 percent of the vehicle s value.
If they decide it s totaled it means that. Your insurance company will typically complete an inspection of the damaged vehicle before officially declaring it a total loss. State laws impact the percentage at which a vehicle is considered totaled.
You keep it and repair the damages. When assessing your vehicle most insurers factor in the condition and structure of your car in addition to any state laws. It is important to remember that an insurance company will only offer to pay for a totaled vehicle if the accident is covered under the policy.
The insurance company keeps whatever money it got for the car in salvage.