Criteria for total loss after MVA?

Question

Can someone explain the criteria used when determining whether a car is "totalled", or a total loss for insurance coverage purposes after an accident?

Does damage to the frame make difference or not??

Answer 1

It depends on who you are insured with.

First, your insurance company will determine the Actual Cash Value (ACV) of your car. They will do this by physically inspecting your car to get an idea of its "pre-loss" condition. This will include the number of miles on the odometer, its overall condition (Is there evidence of unrepaired damage from prior losses? Does the car look like it just got detailed, or does it look likes it has never been cleaned since the day your bought it?), and the level of maintenance. They will also check databases and local dealerships to see how much your type of car is being sold for in your area as a used vehicle.

Once ACV has been determined, they will measure that against the estimated cost to repair the car. If the cost to repair is more than the car is worth it is "totaled". As noted by another respondent, if the cost to repair is CLOSE to the value of the car, it may also be considered "totaled". Every company is different on what they consider "close" to totaled. Some are 70% of ACV, some may be 80% of ACV.

This is where it can get sticky. If your insurance company wants to save money on your claim:

(1)They can lowball the estimate on your car's ACV. Maybe the real ACV on your car is $17,000, but the insurance company offers you $14,500 on a "total". What options do you have if you don't like the offer? Not many, because you don't have a car to drive and they are writing the check.
(2) They can insist on used or non-OEM parts to fix your car and thus hold down the repair costs to avoid a "total".
(3) They can insist that you take your car to an "approved" body shop for repairs. The "approved" shop may then cut corners to hold down costs on the repairs.

Assuming the car is "totaled", the company will then ask you for the title to the car and then cut you a check for ACV plus your local sales tax percentage, minus your deductible. If your car is financed, the check will be made payable to you and the company that financed the purchase. Your settlement check will then be applied to your payoff amount. Anything left will be yours to keep as a downpayment on another car.

If the check for your totaled car is less than what you still owe on the car, you are considered "upside down" on your loan. The finance company will keep your insurance check and you owe them the balance to pay off the loan.

Answer 2

It varies from state to state, but generally, it's when the repair bill exceeds the actual cash value, or comes pretty darned close to it.

If you have a 1968 Dodge Dart, and you break the windshield - it's totalled.

If you have a 2007 Porsche, and the whole rear end is smashed with $25,000 of damage to repair - it's not totalled.

With most states, your damages have to exceed 80% of the actual cash value of the car, in order for it to be totalled.

Answer 3

If it would cost more to repair than the book value it's considered totaled.If you had a 85 chevy caprice and the book value was say 800 dollars and you got into a minor accident that would cost 1000 to fix they would consider that totaled and give you a check for 800.

Answer 4

First they will establish the worth of the vehicle, adjusted for condition. Year, make, model, mileage and options. Electric windows more than crank up type, CD player more than AM radio, etc.

Then they will look at repair costs. Cut off point is generally around 80% or higher of the worth of the vehicle.

Essentially if it costs more to repair than the worth, they will total the vehicle.

Answer 5

If the repair costs are MORE than 80% of the car's actual cash value at the time of the accident.

You can obtain the actual car value at places like:

http://www.kbb.com, or http://www.nada.com

That's it.