How Is the Value of a Total Loss Vehicle Determined?

The value of a total loss vehicle is typically determined by the insurance company based on factors such as the car's age, condition, mileage, and market value. An adjuster may assess the vehicle to provide an accurate valuation.

What Steps Should I Take if My Car Is Declared a Total Loss?

If your car is declared a total loss, you should: 1. Contact your insurance company to report the loss. 2. Provide necessary documentation, such as the title and any loan information. 3. Discuss settlement options with your insurer. 4. Arrange for the removal of the vehicle if required.

What Is Total Loss Car Insurance?

Q: What Is Total Loss Car Insurance?

Total Loss Car Insurance is a type of coverage that provides compensation to the policyholder when their vehicle is deemed a total loss due to damage or theft. This means the cost of repairs exceeds the value of the car, or the car is irreparable.

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Key Takeaways

If you total a car, that means it’ll cost more to repair your vehicle than to purchase a new one. It can also mean the damage sustained has made your car unrepairable.
How much insurance will pay for your totaled car depends on factors like how much coverage you have on your policy and whether you have gap insurance.
The Hartford is here to help every step of the way, from filing a claim to providing peace of mind knowing you’re protected when you’re back on the road.

What Is Total Loss Car Insurance?

Total loss car insurance means you have the right coverages, like collision insurance and comprehensive insurance, to help you pay for a new vehicle if yours gets totaled. If you get into an accident and the cost to repair your vehicle is more than its actual cash value (ACV), your car insurance company will consider it a total loss. It’s also a total loss if it can’t be repaired at all.

If your car is totaled and you have car insurance coverage, your insurer will give you a settlement. Sometimes, they’ll take the car and sell it to a shop to get repaired or rebuilt. If this happens, the car will then receive a salvage title to let potential buyers know that it sustained significant damage.

driver protected by knowing what is a total loss vehicle

When Does an Insurance Company Total a Car?

An insurance company can consider a vehicle a total loss if:

Repair costs are more than its ACV.
The damage amount meets a state’s total loss threshold.
Damages exceed its pre-accident value according to a state’s total loss formula.
The car can’t be repaired due to extensive damage.

Each state has car insurance laws that are unique when a vehicle is totaled. Some use a total loss threshold, which can vary between 50% and 100%. For example, in Arkansas, the total loss threshold is 70%. This means your car is declared a total loss if the damages are greater than 70% of its value. So, if your car is worth $6,000 and sustains more than $4,200 in damages, your insurer will consider it a total loss. The total loss threshold is 70%, which means your car is declared a total loss if the damages are greater than 70% of its value. So, if your car is worth $6,000 and sustains more than $4,200 in damages, your insurer will consider it a total loss.

Other states may use a total loss formula. This means a car is considered totaled if its repair costs plus the salvage value equal or exceed its value.

How Much Insurance Pays for a Totaled Car

How much insurance will pay for a totaled car depends on the coverage you have in your policy. If you have collision and comprehensive coverage, your insurance company will pay you the actual cash value of your car if it’s totaled.

If you finance your car, be aware that the amount you get from your insurance company may not be enough to pay off your car loan. That’s because your car depreciates over time. If this happens, you’ll have to cover the difference out of pocket. That’s why gap insurance is important, because it can help pay off your loan if your car gets totaled and its actual cash value is less than your payoff amount.

How Does The Hartford Handle a Total Loss Insurance Settlement

At The Hartford, we make it easy for you to file a total loss claim. If you get into a car accident and file a claim, this is how the process goes:

File your claim.
After you’ve filed, we’ll send out a claims adjuster to inspect your car’s damage.
Then, we’ll get in touch with you about the settlement you’ll receive for your damaged car.
If you accept the settlement, you’ll then clean out your car and release it.
Once released, settlement payments are sent out within a week.

The settlement you receive can help you purchase a replacement vehicle, depending on your policy and coverage limits.

If you need to make a car insurance claim, our representatives are available to help 24/7. Customers consistently give The Hartford high ratings for their claims experience.

The Hartford Is Here To Help

With The Hartford, you can drive with confidence knowing you’re covered in case an accident occurs. And if you end up with a totaled vehicle, we’re here to help make things as stress-free as possible.

You can file a car insurance claim online quickly and easily.
AARP members can call The Hartford at 877-805-9918.
If you’re not an AARP member, you can reach The Hartford at 800-243-5860.

Frequently Asked Questions About Total Loss Car Insurance

What Is a Total Loss Vehicle?

If your car is a total loss, it means it costs more to fix the damage than it’s worth. If this happens, you can either accept a settlement with your auto insurance company for the vehicle’s ACV (actual cash value) or keep the car and repair it yourself if your state allows it.

How Does Total Loss Affect Insurance?

If your car gets totaled in an accident, it may increase your car insurance premium.

How Long Will Insurance Pay for a Rental Car After a Total Loss?

If you experience a total loss, insurance coverage from The Hartford can help. In fact, our car insurance policies automatically extend coverage to a rental vehicle after an accident. In other cases, you’ll want to make sure you have rental car reimbursement coverage as part of your car insurance policy. If so, your insurer can help pay for rental car costs after a total loss.