When a vehicle gets involved in an accident, the issue of when and whether it’s considered to be “totaled” becomes a very frustrating one for many consumers.
According to automotive experts, a car becomes totaled after an accident when it becomes extremely damaged to the extent that it’s no longer worth repairing. For example, if the actual cash value (ACV) of the car is around $12,000 and needs $10000 worth of repair, it will generally be labeled as a total loss. To determine the price, appraisers say the cutoff is usually somewhere in the 70% to 75% range. Not including the value of scrap metal or salvageable parts after the car has been brought to Toyota wreckers, for example, the vehicle becomes a total loss in this case.
Car owners often get confused about terms such as total loss car and totaled car value. For “total loss car,” many are actually more familiar with the term a “totaled” car. In some cases, a total loss car may be even better than getting someone to fix the car.
What Does it Mean?
As mentioned earlier, a total loss car is a vehicle that would cost more to repair than its actual worth. When a car considered to be totaled, insurance companies would refuse to repair it. Instead, they will offer money that’s equivalent to the actual worth of the car. The goal here is to give the owner money to get a new car.
What is its Purpose?
This setup is actually beneficial for both the car owner and the insurance company. As you are insured, you can recover the money you could have lost. Insurance companies save money in this case. For example, for a car worth $8000 that needs $10000 of repair, the insurance company saves $2000 when the car is declared a total loss.
What’s the Process Involved?
To determine how much damage the car received may take up to a few days. Once the car has been declared a total loss, however, the insurance company will then prepare a check for the car’s value.
For many car owners, the cost and stress of getting a wrecked or totaled vehicle repaired can be downright devastating. Researching about your insurance policy’s stand about totaled cars as well as the state laws will make the process a lot less challenging.