Understanding Total Loss in Auto Accidents
Have you been involved in a car accident that resulted in your vehicle being declared a total loss? Are you now dealing with insurance companies that refuse to give you the money you need to help you secure a new vehicle? While this may seem like an unbearable time in your life, just know you do not have to tackle this complex issue alone.
In the following guide, we will review everything you should know about totaled vehicles to help you understand your rights and the remedies you can pursue.
More specifically, we will explain how a claims adjuster determines whether a car is a total loss, how insurance companies decide how much money they will give you following an accident that totaled your car, and how working with an experienced car accident lawyer can help you obtain the financial recovery you deserve.
What Does It Mean If My Car Was Totaled?
A totaled car typically refers to a vehicle that cannot be repaired, or the cost of fixing it is higher than its fair market value. Determining whether a car was totaled in an auto accident is crucial since it affects your ability to file an insurance claim and recover compensation.
It should also be noted that while some states have their own total loss threshold for defining a totaled vehicle, if there are no specific laws, the insurance company will decide if the car qualifies as a total loss based on its value and repair costs.
Who Pays for a Totaled Car? Understanding Insurance Coverage
While dealing with a totaled car is incredibly stressful, determining who will pay for this damage can be a confusing and challenging ordeal. In general, obtaining compensation for these damaged vehicles will depend on where you live and the insurance coverage involved. Take, for instance, the following factors:
The Insurance Coverage
If you live in an at-fault state and another driver hits your car, the at-fault driver's insurance will cover the damages that resulted from the accident. However, you may also use your own auto insurance, such as collision coverage, which will pay for the damage regardless of who was at fault.
In comparison, in a no-fault insurance state, motorists will have to turn to their own insurance coverage to cover their damages after a motor vehicle accident, even if they were not at fault for the crash.
Collision and Comprehensive Coverage
Collision and comprehensive coverage are optional supplemental insurance used to help replace a totaled motor vehicle. Without these coverages, you may have to pay out of pocket to purchase a replacement vehicle.
This type of insurance coverage is especially great if you want to ensure extra protection for your vehicle, primarily if you are driving a high-value vehicle or leasing or financing the car. In fact, most lenders require comprehensive and collision insurance if you are financing your vehicle.
Additionally, some insurers offer new car replacement coverage when your car is totaled. With this policy, the auto insurance company pays for the cost of replacing your vehicle if it's under a certain age or mileage.
Determining Who Covers the Costs of a Totaled Car
Understanding who pays for a totaled car depends on various factors. If the other driver’s insurance denies your claim or there’s a dispute over fault, contacting an experienced car accident attorney can help. These professionals can investigate the crash, determine liability, and help you secure compensation.
These attorneys can perform their own investigation of the crash, determine what happened and who was at fault, and help you figure out how you can secure the money you need to cover your destroyed vehicle.
How Insurance Companies Calculate the Value of a Totaled Car
Generally, when you file a claim, the insurance company will evaluate whether your vehicle is a total loss by comparing the cost of repairs to its actual cash value (ACV). If repair costs exceed the total loss threshold set by state law or the insurer’s policies, your car will be declared a total loss.
The Factors the Insurance Company Uses to Determine the Actual Value of a Totaled Car
To figure out the actual cash value of the totaled car, which refers to the sale price the motor vehicle could have fetched if you sold it before the crash, the insurance company will use these factors:
- The car’s age
- Make and model
- Mileage
- Pre-accident condition
- Potential for unseen damage
- Salvage value (the resale value of parts and scrap metal)
- Local market demand
Determining Actual Cash Value After the Total Loss of a Vehicle
After the insurance company determines that the car was totaled, it will determine the actual cash value of the vehicle and then provide you with compensation based on the vehicle's fair market value.
Yet, this does not mean that this amount will be enough to cover buying a new vehicle or even pay off your car loan. Sometimes, you may even question this amount because you believe the car's retail market value should be worth more. Plus, more importantly, if you accept the insurance amount, you will likely be unable to keep the damaged vehicle to try to obtain money for any of the parts.
If you disagree with the insurer’s assessment, you can present your own evidence—such as repair estimates, maintenance records, and recent sales data—to challenge the valuation.
Be Careful About Working With the Insurance Company After a Total Loss
You may think that the insurance company will do everything it can to ensure you are supported and get the money you need after an accident, especially if it's your own insurer. This is usually the furthest thing from the truth. The insurance company is a business, and like other businesses, it wants to make the most money possible. To accomplish this, insurers must pay you less than you are entitled to.
Insurance companies often aim to minimize payouts after a total loss accident. Even your own insurer may undervalue your vehicle to reduce settlement costs. Claims adjusters might:
- Offer a lower payout than your car’s true fair market value (FMV).
- Highlight minor damages to justify a reduced actual cash value (ACV).
- Pressure you to accept the initial insurance settlement quickly.
Insurance companies may also apply deductions for factors like depreciation, salvage value, and local market fluctuations, potentially lowering your payout further.
If you believe the total loss settlement is unfair or that your car’s ACV has been miscalculated, consult a skilled car accident lawyer. They can help you:
- Negotiate a higher settlement based on accurate market data.
- Challenge unfair deductions made by the insurance company.
- Pursue legal action if the insurer refuses to offer fair compensation.
A knowledgeable attorney can also guide you through the process of disputing an insurance adjuster’s valuation, helping you secure the full amount you’re entitled to after a total loss accident.
Other Things You Can Do After a Totaled Car Accident to Fight For Your Rights
Following a car accident that totaled your vehicle, the first thing you should do is get medical help. However, if possible, you should also take other steps to help you stay safe after this crash and ensure your legal rights remain protected. These steps include the following:
Reach out to the Authorities
If you cannot call 911 after the car collision, have someone from the accident scene call for you. This can help you get the required medical care and the police to the scene immediately.
Once the officers arrive, they will investigate the crash and document their findings in their police report, including information about the parties involved, conclusions about the accident, and other details about the crash. If you file an insurance claim or decide to pursue a lawsuit, this report can help your attorney prepare the most convincing legal case and go after the maximum compensation you are entitled to.
Get to a Doctor Immediately
If you are not transported to the emergency room after a totaled car accident, you should still get to a medical care professional immediately. These doctors can thoroughly examine you and figure out if you have any non-visible injuries, such as head trauma, internal bleeding, or spinal cord injuries.
Additionally, these doctors can prepare a medical report, which can not only detail the extent of these injuries but also provide your attorney with evidence of a link between the crash and your trauma. This can help support your case and establish the total extent of your damages.
Obtain Evidence From the Crash Scene
If you do not require emergency medical treatment and you can move around, taking pictures and videos of the accident scene can be critical for your legal claim. These photos should include pictures of the vehicles involved, the full extent of the damage to your car, your injuries, the placement of the vehicles on the road, the road, weather, and traffic conditions at the time of the accident, defects on the street, traffic signs and signals near the collision, and any other details that can help establish what happened.
Yet, do not panic if you cannot collect this information because of your injuries. After you hire a skilled car accident attorney, these legal professionals can work on obtaining all this information for you to help strengthen your case.
Exchange Details With Others Involved in the Collision
After the accident, try to obtain information from the other drivers if they are willing to talk to you. This includes their names, contact details, driver's license numbers, insurance details, and car details.
However, avoid making conclusive statements about the incident, apologizing for anything that happened, or taking any blame for something that was not your fault. These comments can be used against you by the other side or the insurance company and can impact the amount of money you can receive after the accident.
Look for Witnesses Who Saw the Crash
If people were present during the accident, see if you can obtain their personal details, including their names and contact details. These witnesses can provide your attorney with further information about the incident, including what happened and who was responsible, and offer testimony that can help collaborate your claim, which can prove beneficial when you are trying to secure maximum compensation for your totaled car.
Reach Out to an Experienced Car Accident Attorney After a Crash Totals Your Car
After a motor vehicle accident, you are dealing with enough. The last thing you want to do is worry about your totaled car and how much money you can receive for it. Thankfully, you will not have to deal with this issue alone. When you hire an experienced car accident attorney, these lawyers can tackle this situation for you and go after the monetary damages you deserve.
To do this, these attorneys can:
- Review the facts of your car crash, review the damage that resulted, and help determine your legal options.
- Perform a thorough investigation into the accident and obtain the evidence to show what happened and who was at fault.
- Discuss your questions, review your concerns, and provide the legal support you require.
- Bring in experts to prove your legal claim, including financial experts.
- Deal with the insurance company on your behalf, and fight for the settlement offer you deserve.
- If the other side is not willing to offer you the money you need, go to trial to seek maximum compensation.
If you or a loved one suffered harm and a totaled car in an accident due to another person's reckless or negligent actions and you are having a hard time securing the money you need from the insurance company, reach out to an experienced and knowledgeable personal injury attorney today for a no-cost evaluation of your case. The Nicolet Law Accident & Injury Lawyers can review your claim, discuss how they can help you fight for your rights, and determine what damages you deserve. Contact us today for a free consultation.