What Does It Mean When a Car is Totaled?

Car accidents are found near the top of the list of events that stress people out. It causes worry about so many issues: Whether you got hurt. Whether someone else got hurt. Whether your insurance rates will go up. Whether you’ll be found legally liable for someone else’s damages. Whether your car will need repairs or you’ll need a car rental, or if you’ll have to miss time from work.

But what happens when you contact your car insurance company only to be told that they can’t pay for your car repairs because it’s been totaled? What, exactly, does that mean?

What does it mean when a car is totaled?

“Totaled” is a term to indicate that the damage to a motor vehicle is so substantial, that the car is deemed a total loss. In other words, fixing it would be more expensive than simply purchasing a new car.

An insurer will make this determination after an agent assesses the damage to your car. Not only will the appraiser make a decision regarding the state of your motor vehicle, but he or she will also be the person tasked with figuring out the cash value of your car. In order to do this, they will note the year, make, and model of your vehicle, along with its mileage. The information will then be compared with similar automobiles in your area to estimate an approximate value. That’s the amount that your insurance company will offer to pay.

When a car has been totaled in an accident, the car insurance company will offer the insured a check for the value of the car. This may be frustrating, especially if you think that your car looks like it could be repaired. However, when making their determination, insurance companies will not only look at the repair costs but also at the following related expenses:

  • Towing
  • Storage
  • Car rental

Bundled together, it may make more financial sense for your insurance company to call it a loss and pay you for it.

It’s also important to be aware that not all insurance policies will pay you money for a totaled car. For them to consider issuing a check, you must have such coverage included in your policy.

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

If you still owe money on a car loan, the insurance company will send the cash value payout to your lender. If the check is more than enough to cover the remaining loan balance and there’s money left over, your lender will send you the balance. However, if the payout is not enough to cover the remainder of the loan, you will be responsible for paying it out-of-pocket.

What to Do if Your Car is Declared Totaled

If you don’t agree with your insurance company’s determination, you can have your car inspected by third-party auto repair shops or mechanics and provide documentation to the insurance company to dispute their conclusion. If you have enough documentation to back your claim, the adjuster may be willing to enter into settlement negotiations with you.

If you agree with the insurance company’s determination, you’ll have to complete the related paperwork and remove the license plates and personal items from inside the car. You would then leave the car and its keys with the insurance appraiser.

A third option would be to repair the vehicle yourself. In this instance, you would notify your insurance company of your decision, then notify the Florida Department of Highway Safety and Motor Vehicles within 72 hours of the agreement. The Certificate of Title will then be branded with the words “Total Loss Vehicle” so that the determination will always be included in the vehicle’s title history. This is required by law.

Call Clark Law if You’ve Been Involved in a Car Accident in Tampa Bay

If you or someone you love has been involved in an accident, call us at (855) 680-4911 or schedule a free consultation. At Clark Law, we have experienced attorneys who regularly represent clients who have been involved in a motor vehicle accident, and we can help you determine the best next step.

Disclaimer: This blog is for informational purposes only and does not create an attorney/client relationship.

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