When you receive the news that your vehicle is totaled, you may be sitting there wondering, “My car is totaled? How can that be when it looks practically the same?” Visions of totaled cars typically recall scenes of a mangled mess of metal and mayhem.

If your car is totaled, that simply means your insurance company determined your vehicle is either unable to be repaired or that repairing it would cost more than the car is worth. Discover what happens after your car is deemed a total loss, from determining how much your car is worth to what to do with your vehicle at the end of the day.

How Much Is My Car Worth?

accident_2To determine whether your car is a total loss, your insurance company needs to calculate its actual cash value. They begin their calculations with how much your car was worth prior to the accident. Your adjuster might take away value based on certain factors like warps, dents, rust, leaks, and your car’s mileage. Alternatively, they may add value based on any enhancements or customizations.

Your insurance arrives at their final value after they factor in the damages from the accident and how much it’ll cost to repair your vehicle, as well as your car’s salvage value. In the end, if the cash value of your car is higher than the repair costs and salvage value, your car isn’t totaled. However, if the cash value is lower than the repair costs and salvage value, your car is a total loss.

How Much Does My Insurance Owe Me?

The amount of money your insurance company owes you for your totaled vehicle depends on whether you own your car, lease it, or finance it. If you own your vehicle, your insurer subtracts your deductible and any other applicable fees from your car’s cash value and reimburses you for the remaining amount.

If you lease your vehicle, your insurance company pays the above amount to your leaseholder. If you finance your car, your insurance company pays your financing company for the remaining amount you owe them for your car. If your car’s value exceeds how much you owe the financer, you get the rest of the money. If the value of your vehicle is less than the amount you still owe your leasing or financing company, your insurance will pay them the total amount for your car, and you’ll still owe your company the remaining balance on your car.

My Car Is Totaled, but It’s Not the End of the World

If you’re wondering what happens to your vehicle after it’s totaled, you have a few available options. What happens to your car after it’s deemed a total loss depends on how much money you want from your insurance company.

You can opt to keep your car rather than hand it over to your insurer to sell to a salvager. In this case, they may still reimburse you for your car’s value. If they do, they’ll subtract the amount a salvager would have paid them for it. If you choose to hold onto your car, make sure you adhere to your state’s reporting requirements. This normally involves, at the very least, re-titling it as a salvaged vehicle. In the end, your car may be a total loss, but that doesn’t mean everything else is, too.

Collision 24

Collision 24, serving the Brockton, Randolph, and Stoughton areas, is your local full-service vehicle repair shop. We’re available Monday through Saturday, so contact us today to schedule your next appointment.