Getting in a car accident is devastating. But it can be more overwhelming if the insurance totals your vehicle and the evaluation is less than expected. So, what does it mean when your car is totaled? Read on to learn what it means when your vehicle gets totaled and recommendations on what to do to ensure fair compensation for your damaged vehicle.
What Does It Mean if Your Car Is Totaled?
Your insurance will declare your car a total loss if the repair cost repair equals or exceeds the car’s actual cash value (ACV) at the time of the accident. Many people mistake the actual cash value for how much they paid for the car. However, your vehicle starts depreciating after you leave the yard. A car’s value may drop by 20% in the first year, depending on the model, make, age, mileage, and ownership history. A used car will lose value more than a new one.
How Does the Insurance Calculate Your Car’s Actual Cash Value?
Your insurance service provider will calculate your car’s actual cash value to determine how much you will receive when your vehicle is totaled. The amount equals the replacement cost minus its depreciation. Your insurance provider will contact a claim adjuster to inspect your car and determine how much it will cost to repair it, the reasons for its damage, and how much you will receive as the payout.
If you agree with the payout, you can sign for the insurance to release the payout. However, sometimes the payout may be less than you expect, and you have a right to dispute the claim and negotiate for a higher amount.
Negotiating a Total Loss Insurance Claim
You can negotiate with your insurance company if the payout amount is far less than your car is worth. Demand to see the evaluation report when your car is totaled because most insurance won’t provide this information.
The total loss evaluation report describes the condition and value of your vehicle compared to other cars of the same model. Bring all your paperwork that indicates how much you bought your vehicle, maintenance and repair records, or pictures that reflect the state and the actual value of your car during the accident. Determine a counteroffer instead of waiting for the insurance to provide one. The final offer may still be lower than your car’s value.
If you altered your vehicle to improve its safety, performance, and aesthetics, bring documents that support this because the insurance often fails to include them, significantly undervaluing your car.
Contact a Car Accident Lawyer
Negotiating your total loss insurance claim may be overwhelming, especially if you can’t agree with your insurance. You can hire a mechanic, appraiser, or car accident lawyer to request arbitration or file a lawsuit. An attorney will negotiate with the insurance on your behalf, provide legal advice and represent you in court.
Contact us for a free case evaluation and get answers to your total loss insurance claim questions.
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