YOU ASK:

How much money do you get if your car is totalled?

WE ANSWER:

The car's fair market value at the time of the accident minus the deductible. This is based on the value provided by the blue book.

A car is totalled not just when it is totally wrecked, damaged or beyond repair. A car is declared to be a total loss depending on the policies of the insurance company.

A Matter of Value

It really depends on the current value of the car. If the insurance company does not deem it worth having the car fixed, then the insurance company will just declare the car a total loss. This is when:

  • Your car is totally beyond repair and its value will only be for scrap metal.
  • Your car is still fixable but it will always be in bad condition.
  • The cost of the car post-accident is at a certain percent of its actual value. The percentage will differ from one insurance company to another. Some insurance companies declare the car a total loss if the value is lowered to 80% while some do this if the value is lowered to 51%.

How Computations Are Made

When a car is declared a total loss, it may be auctioned off for its scrap value. What the insurance company will receive the payment from the highest bidder and keeps this money. What they will pay you is the car's actual market value minus the depreciation listed in the policy.

Disputes

If you feel that the insurance company is not giving you a good settlement, you can get an independent appraiser to inspect your car and to give you his appraisal in written form. However, this will be at your expense. If this vastly disagrees with the value given by the insurance company, you can use the report to build your case.

If there still is dispute, then, you can try either for arbitration or litigation. For arbitration, a third-party arbiter decides on your case. In litigation, you bring your case before the court. But before you start with arbitration or litigation, you should consider the expense and the effort, if it is worth the trouble.

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