How does an Insurance Company deceide on totaling a vehicle and how do they determine the amount to be paid?

Question

I have a 97 Expedition which was in EXCELLANT condition. I was recently hit in the side. I have had a couple estimates done, but have heard because of the age of the vehicle and the total amount for repairs they will probably total it out. It is still able to be driven. This car is the vehicle that hauls my entire family when we are all riding together. I would like to have it fixed. I wasn't sure how they deciede on totaling a vehicle out and how they determine the amount to be given for the vehicle. Especially to replace it. I am very worried about the outcome of this disaster!! :( The accident was not my fault and the lady who hit me has admitted fault in the police report. Along with other eye witnesses. Please help with any info anyone has to offer!!!

Answer 1

In most states - a vehicle is a total loss when the cost to repair the vehicle (including parts and labor) equals or exceeds 75% of the cars fair market value (ACV- Actual Cash Value).

The ACV is what you could have reasonable sold that car for given it's age, condition, mileage.

Insurance companies do not use Kelly Blue Book - don't waste your time looking there.

Also - be realistic about the condition of your vehicle. Most vehicles are in average condition - not EXCELLENT. Did you really steam clean the engine? Are the tires brand new? When you washed the car - did you clean the door jambs too? Did you have every recall and all service work done on the car when Ford said to? Very few cars meet this.

The insurance company will inspect the car - evaluate it and come up with a value based on the cars options, condition, mileage. Your adjuster can give you more specifics.

Answer 2

This Site Might Help You.

RE:
How does an Insurance Company deceide on totaling a vehicle and how do they determine the amount to be paid?
I have a 97 Expedition which was in EXCELLANT condition. I was recently hit in the side. I have had a couple estimates done, but have heard because of the age of the vehicle and the total amount for repairs they will probably total it out. It is still able to be driven. This car is the vehicle that...

Answer 3

Totaling A Vehicle

Answer 4

Whether or not a vehicle is totalled depends on how much it costs to fix it versus the fair market value of the vehicle (had it not been involved in a collision). How much they pay you depends on the difference between the loan payoff (if any) and the fair market value, less any insurance deductible.

For instance, I totalled a Mercury Villager minivan almost 2 1/2 years ago. I don't remember the repair costs, but the fair market value was about $7,500. The loan payoff was about $5,000 and I had a $1,000 deductible. $7500 - $5000 left me about $2500. BUT since I also had a $1000 deductible, that money came out of the $2500, leaving me a total settlement of $1500.

(I didn't get even half of that due to ex-husband issues - but that's another story.)

Answer 5

MSAD is pretty correct....insurance co's will total a vehicle if the repairs approach or exceed 70-80 percent of the retail value of the vehicle. Keep in mind that insurance co's may not give you a fair amount for your vehicle especially if it's from another party's insurance. Find out (local ads, used car dealers, web info, KBB.com or Edmunds.com) what it would cost to buy another vehicle just like yours or as close as possible to it in terms of condition, mileage, options, recent major repairs, color, trim model and maintenance records...you need to settle for only what it would take to buy another truck just like yours, don't settle for anything less. Stick to a figure and have them pay for a rental vehicle while you are deciding or looking for another vehicle. You are the injured party and they need to make it right by you.

Answer 6

You can demand anything you want, Reality is what you are going to get from the insurance companies. Most do not pay KBB, NADA or Edmonds or any other kind of book. They will do what is called a market survey based on many things such as year, make, model, mileage, condition, paint, interior, prior damage, tire wear, glass damage. ALl this information is gathered and rates on a scale from poor to excellent and a value is given. They owe your for a replacement of your vehicle,not a down payment for a new one or anything like that. The value of YOUR vehicle as it was before the accident.

Answer 7

In Australia insurance companies go off the current market value of the car which can be found on www.redbook.com.au and usually if it will cost them more than 50% of the current market value they don't bother repairing it they write it off for some reason.. Can't tell you why it just happens.. It will also depend upon your policy and the amount you have it insured for - have you spoken to the womans insurance company about it??

Answer 8

They will compare the estimates to the value of the vehicle from a place like Kelly Blue Book. If the estimate exceeds the value, it's totaled. They will pay you the value of the vehicle. YOu can negotiate though. They may want to keep the vehicle. If you want to repair it, try to get them to pay the value and you keep the car. We've done that before.