If you’ve ever been in an accident, you know your car looks pretty gnarly afterward. Depending on the severity, it’s surreal that you were sitting inside the car when the damage took place. A claims adjuster will come to assess the damage on your automobile. Unfortunately, sometimes the damage is so bad, that they have to declare the car a total loss.

The insurance company will total your car when the cost of repairs exceeds a certain percentage of the value of your car. In this case, it would cost your insurance company more money to repair the car than to buy a new one. Typically, the cost of damages would have to exceed about 75% of the fair market value of the car for it to be considered totaled. However, the percentage depends on the state you live in and your insurance carrier.

To you, it may not look like the condition of your car is severe enough to be labeled “totaled.” If you have some sort of attachment to your car, the term “total loss” can devastate you. Maybe you feel like there is a cheaper way to fix the car. You may be able to work with your insurer if that is the case. Otherwise, it’s important to keep in mind that there are other factors that go into deciding if a car is a total loss.

There is also a chance for you to choose to keep your car in the condition it’s in, which will affect your payout and the value of your car.

When a car is deemed a total loss, your insurance company will pay out on the actual cash value of your vehicle. The value is determined based on condition and the current market value of your car.

Be safe on the road to avoid a total loss of your precious vehicle!

By: KayLynn P.