What Really Happens When Insurance Totals Your Car?

What Happens When Insurance Totals Your Car

Car accidents can be a traumatic and stressful experience. Not only can they cause damage to your vehicle, but they can also result in injuries to yourself and others involved. In some cases, the damage to your car may be so extensive that it is considered a total loss by your insurance company. So, what happens when insurance totals your car?

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Understanding Total Loss

When your insurance company determines that the cost to repair your vehicle exceeds a certain percentage of its actual cash value (ACV), they will deem it a total loss. Generally, this percentage is around 70% to 80%. ACV represents the value of your car at the time of the accident, taking into account factors such as its age, condition, and mileage.

So, if the repairs required would cost 70% or more of your car’s ACV, insurance will likely consider it a total loss. This means that your car is not financially feasible to repair and will be written off.

Filing a Claim

If you’re involved in an accident and your car is declared a total loss, the first thing you need to do is file an insurance claim. Contact your insurance company and provide them with the necessary information, such as the accident details, your policy number, and any documentation they require.

Evaluating the Value

Once the claim is filed, the insurance company will begin the process of evaluating the value of your car. They will assess its pre-accident condition, considering factors such as mileage, options, and any previous damage. Additionally, they may use industry tools and databases to determine the appropriate value.

Insurance companies typically assign a claims adjuster to handle the evaluation process. The adjuster will inspect your vehicle, collect all necessary information, and prepare an estimate of its value.

Settlement Options

After the evaluation, your insurance company will provide you with settlement options. These options usually include:

  • Repairing the vehicle
  • Taking a cash settlement
  • Replacing the vehicle

If you choose to repair your vehicle, the insurance company will provide you with the funds necessary to cover the cost of repairs, minus your deductible. However, it’s important to note that in the case of a total loss, choosing this option might not be feasible.

Alternatively, you can opt for a cash settlement. This means the insurance company will provide you with a sum of money equivalent to the ACV of your vehicle. You can use this money to purchase another car or cover any outstanding loans related to the totaled vehicle.

If you decide to replace your vehicle, the insurance company will provide you with the ACV amount, but instead of a cash settlement, they will help you find a similar vehicle to purchase.

Salvaging Your Car

Once the insurance company determines your car is a total loss, they will often take ownership of it. They may offer you the option to buy the salvage rights, meaning you can keep the vehicle and try to repair it on your own. However, salvaging a totaled car is not always recommended, as it can be costly and may not be safe.

Remember, insurance companies will often require you to obtain a salvage title if you decide to keep the vehicle. This type of title indicates that the car has been damaged and deemed a total loss.

Frequently Asked Questions On What Really Happens When Insurance Totals Your Car?

What Happens If My Car Is Totalled By Insurance?

If your car is totalled by insurance, they will pay you the actual cash value of your vehicle before it was damaged.

Will Insurance Cover My Car If It Is Totalled?

Yes, insurance will cover your car if it is totalled as long as you have comprehensive and collision coverage on your policy.

How Is The Value Of A Totalled Car Determined?

The value of a totalled car is determined by considering factors such as its age, condition, mileage, and recent sales of similar vehicles in your area.

Can I Keep My Car If It Is Totalled By Insurance?

Yes, you can keep your car if it is totalled, but the insurance company will deduct the salvage value of the vehicle from your settlement amount.


When insurance totals your car, it can be an overwhelming experience. However, understanding the process can help you navigate through it more easily. Remember to contact your insurance company, evaluate your settlement options, and consider the feasibility of repairing or replacing your vehicle.

Ultimately, the goal is to reach a resolution that allows you to move forward and get back on the road safely and hassle-free.

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