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How Much Damage Before a Car is Considered Totaled?

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You unfortunately get into an accident with extensive damage. But how much damage to total a car completely is something you might be wondering about. Most consumers are perplexed about when and whether a vehicle involved in a collision is considered “totaled” for first-party insurance purposes. We heard it all — consumers having their older but working cars tagged as “totaled” simply because the frame incurred some bents or other seemingly minor and hidden damage. In this article we will discuss all about how much damage to total a car and other related information that could help you regarding this whole subject.

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How Much Damage to Total a Car: The Criterias


State or Insurance Company Criteria


The criteria for deciding how much damage to total a car and when it can be repaired vary from insurance company to insurance company and might even be dictated and controlled by state statute or regulation. 


The fact that insurance companies do not all use the same sources to determine the value of a vehicle complicates matters even more. So calling your insurance agent will provide you with the threshold used by your company to get the answers that you need. Insurance professionals, on the other hand, must be familiar with all 50 states' rules, criteria, and thresholds.


But to put it simply, a car is generally considered totaled when the cost of repairing it exceeds the car's value. Some states have laws that define a totaled vehicle based on a set of criteria. In New York, for example, a car may be declared totaled if the damage exceeds 75% of its value. A totaled car usually means that it is so badly damaged that it is not worth repairing. For example, if a car is worth $10,000 but requires $7500 in repairs, it is not worth it and will most likely be classified as a total loss.




However, even if the cost of repair is less than the ACV, it is not always practical to repair a vehicle. An insurer may consider a vehicle worth $5,000 that requires $4,000 in repairs to be “totaled,” even if the cost of repair is less than the vehicle's pre-accident value. Insurance companies will usually consider such a vehicle a total loss, even if the repairs are minor. So at the end of the day how much damage to total a car is also considered by the practicality of the situation.


For example, in order for a new car to be totaled, the damage must be severe. However, insurance companies will declare older vehicles total losses, even if the damage appears minor. If you're driving a 20-year-old car, unless it's vintage, chances are it's not worth much money. Even if the repairs are feasible, if they exceed the value of the vehicle, the insurance company will declare it totaled. If your vehicle is totaled, the insurance company will pay you the car's pre-accident value.


Miles on the Car


The number of miles on the car, like the age of the car, is another factor. The more miles it has, the less it is worth. Check your mileage if at all possible. In addition to how much damage to total a car, you should also be able to figure out the number of the miles by looking through previous servicing reports.


So how will insurers determine your car’s value? To calculate your vehicle's worth or in insurance terms, the “actual cash value” at the time the accident happened, insurers typically use a number of factors, including its age, mileage, and resale value, as well as the selling price of similar vehicles in your area.


The key is to figure out how much your car was worth before the accident. This will be determined by a variety of factors, including the make and model of your vehicle, in addition to what was mentioned, like the vehicle’s mileage and overall condition. Cars typically depreciate 20% in their first year and 10% each year after that, at least for the first five years. Your insurance company most likely has a formula in place that will assist them in determining the car’s value pre-accident.


Many people mistakenly believe that the value of their car is the same as it was when they bought it. Unless you were in an accident shortly after purchasing your car, this amount is rarely relevant. The cost of painting any part of the vehicle, replacing electronic parts in accordance with manufacturer specifications, and towing the vehicle are all exceptions to the cost of repair.


Also, the term “totaled” does not apply to any vehicle that is 10 years old or older and only requires the replacement of the hood, trunk lid, fender, and/or other bolted parts, such as doors or grill assembly. As a result, even if the cost exceeds 65 percent of the fair market value, a very old vehicle that requires a trunk lid replacement is not totaled.


Damages on Parts


How much damage to total a car when it comes to parts:


Can body damage total a car?


Most insurance companies will consider your car to be totaled if it is more than five years old and has extensive damage to the frame. The costs of rebuilding the car's frame and repainting it would be very expensive.


Look it up on Kelley Blue Book to see if your car still has a lot of its original value (KKB). You will be asked in what condition your car was prior to the accident. While KBB is only a guideline, it can help you determine whether your insurance company will cover the cost of repairs or give you money to replace your car


Will a broken axle totaled a car?


If the accident has resulted in a broken axle, a tweaked or dented pillar (the parts holding up the roof, the front windshield frame, that part in between your front and rear doors, and rear roofline), or extensive damage to the drivetrain or undercarriage components, you may be looking at a total loss.


Is a car totaled if airbags deploy?


No, the deployment of airbags does not automatically render a vehicle a total loss. If a vehicle's airbags deploy and the cost of replacing them exceeds your state's total loss threshold, the vehicle is declared a total loss.


How Much Damage to Total a Car: Other Related Questions


  • How much does insurance pay for a totaled car? 


If your vehicle is a total loss, you have two options: accept the cash settlement for the vehicle's ACV or, if your state allows, “retain the salvage” and request that the damaged vehicle and its title be returned to you.


While each state’s process may vary slightly the insurance company will typically take possession of the totaled vehicle, which is known as “salvage” and may obtain a “salvage title” for the vehicle. After it pays the vehicle's insured pre-loss ACV and forwards the certificate of ownership, license plates, and a required fee to the Department of Motor Vehicles (DMV), the DMV issues a Salvage Certificate for the vehicle.


In other cases, the vehicle will be repaired and then re-registered with the DMV before being classified as a “salvaged” or “revived salvage” vehicle. If the insured wishes to keep the “totaled” vehicle, the insurance company will deduct the salvage value from the claim payment.


The majority of customers opt for the settlement value, which is determined by the industry's leading vehicle valuation database. If the vehicle is owned outright, payment is made to the customer. Payment is made to the lienholder, which could be a bank or a credit union. Anything left over after paying the lienholder is returned to the customer. Anything left over after paying the lienholder is returned to the customer. After deducting the customer's deductible, all payments are made.


A claims adjuster will typically inspect the vehicle as part of an accident claim involving vehicle damage. The adjuster can take note of the car's condition and attempt to determine its fair market value prior to the crash.


The adjuster may then request that you take the vehicle to a body shop in their network to obtain a cost estimate for repairs. The adjuster will decide whether the vehicle is a total loss based on the estimate. 


The collision repair shop or claims adjuster must take their time in determining the full extent of the damage. This may include technicians disassembling the vehicle to assess the extent of the damage. Following that, the estimator must conduct a thorough inspection of the vehicle's condition. This information aids in determining the car's value.


The mileage of the vehicle, how much the tires have worn, if there are dents on the vehicle, if there are other areas of damage outside of the claim area, if there are chips or cracks in the windshield, and other wear and tear, as well as if the interior is clean, and anything else that can help determine the vehicle's value are all factors that are considered. The condition of the previously mentioned items is important because if they can be sold and reused in another vehicle, the value of the vehicle will increase.


  • What insurance can help pay for a totaled car? 


Comprehensive coverage and collision coverage are the two most common insurance that could help you when you total your car. If you have these optional coverages, you will be protected up to the actual cash value of your vehicle if it is declared a total loss. Collision insurance protects you if you collide with another vehicle or overturn. Comprehensive coverage protects against events such as fire, vandalism, and colliding with a deer.


  • What happens when your car is totaled and you still owe money on it?


It’s the plain truth that a new car will lose its value the moment you drive it off the lot. Because the cash payout for a totaled car is based on the actual cash value – not the amount owed on your car loan – you may be in a difficult situation if your car is totaled and you still owe money.


However, there is a way to safeguard your investment. If you have a lease or loan on your vehicle, the endorsement will come in handy if you owe more than the vehicle is worth. Speak with your agent about how your coverage can benefit you.


According to the Insurance Information Institute (III), if you're financing a totaled car, your insurance company will likely make the claim check payable to both you and your lender, meaning you'll have to work out a plan with your lender to get the money released. Typically, the lender will be reimbursed first, with any remaining funds paid to you later


It's possible that you still owe your lender more for the car than you receive in insurance payments. In that case, you must pay the remaining balance on the car lease or loan. Including loan or lease gap coverage in your car insurance policy is one way to protect yourself from having to pay a lender out of pocket for a totaled vehicle. This coverage may optionally be available as part of a package, if not as a standalone policy depending on your insurer. It may also be limited to brand-new vehicles.


  • What if my car being totaled wasn’t my fault? 


In some cases, a totaled car may not be the fault of anyone. Assume, for example, that a tree falls on your parked car and your insurer declares it totaled. If you have comprehensive coverage on your car insurance policy, it will most likely reimburse you for the vehicle's actual cash value (again, minus your deductible).


If your vehicle is totaled in an accident caused by another driver, your collision coverage may kick in first. Your insurer, on the other hand, may seek reimbursement from the other driver's insurer to cover the loss. In certain cases, this may imply that you will also be reimbursed for the deductible coming off from your insurance payout.


If you got into an accident and are worried about your car being totaled, don’t! You will not be left with nothing. It might just be time to change and upgrade your ride, and even totaled or junk cars have a value. Learn about it here at Cash Cars Buyer.

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