What Does the Insurance Company do With My Totaled Car?
If you are lucky enough to walk away from an accident without a scratch, you still might have a significant repair bill looming in front of you. Your insurance company might deem your vehicle a “total loss.” Totaled might not mean exactly what you think. While a car that is incapable of being driven again will be considered totaled, the damage does not have to be that severe, especially if you have an older vehicle.
But what happens when your car is totaled? Hopefully, the insurance company will pay you what your vehicle was worth before the accident. The car itself will usually be taken to a salvage yard, where a vendor will work with various dealers to sell the car based upon its salvage value.
Car accidents often result in a rippling effect of problems, headaches, and issues. Accident victims have to deal with their injuries, medical care, and repairing or replacing their damaged vehicle. Our team of experienced Philadelphia car accident lawyers is committed to assisting our clients through this difficult time. To see how our law offices could help, call the Reiff Law Firm at (215) 709-6940.
What Does “Totaled” Actually Mean?
If you have discussed a car accident with a friend or family member, the word “totaled” probably appeared somewhere in the conversation. For many people, totaled means that the car is no longer drivable or not worth the cost of repairs. The latter is a more accurate definition of the term. Your car could be fixable after a crash yet still be considered a total loss.
Typically, to determine if a vehicle is a total loss, an insurance company will compare its actual cash value (ACV) with the cost of repairs and the vehicle’s salvage value. The cost of repairs is usually based on an estimate of a mechanic that the insurer hires, while the salvage value is the vehicle’s value in its present state. If the salvage value and repairs are equal to or exceed the ACV, the vehicle is considered totaled. Some insurance companies will use a slightly different formula, such as declaring a car totaled if the combined repairs and salvage value are 80% of the actual cash value.
From the car owner’s point of view, the ACV is the most important value. This number is not only a key factor in whether the car is considered a total loss, it is also the amount the insurance company will pay the vehicle owner. Our Pennsylvania car accident lawyers are available to assist you if you dispute this value.
Determining the Actual Cash Value of a Wrecked Vehicle
The ACV is how much your car was worth immediately before the accident. There are a number of factors that are considered in determining this amount.
- Options or Additional Features
- Previous Accidents
- General Condition
If you are a car owner, you could look at the Kelley Blue Book to get an idea of your car’s value based on the above and your geographical location. Insurance companies will typically find comparable cars to determine an average. This method often hurts the car owner because several of the listed vehicles are likely artificially low, bringing down the overall average value. Insurers are looking to limit their liability, including paying as little as possible on a damage claim. Are Bucks County car accident lawyers usually advise people to request a list of these vehicles and challenge them if necessary.
Once a car has been judged to be a total loss, the car owner will be compensated for the ACV and the insurance company will sell the salvaged vehicle to offset their losses. By keeping the ACV low as possible, an insurance company limits its total liability.
Disputing the Actual Cash Value of Your Damaged Vehicle
You do not have to accept an insurance company’s settlement offer. Furthermore, you are allowed to dispute the insurer’s value determination. However, to do so, you must provide compelling evidence.
First, you should request a copy of the comps the insurance company used to determine the actual cash value of your car. You could also rely on the Kelley Blue Book and local sales in your area to determine a reasonable price for a car that matches your make, model, and year. It is likely that only a few of the comparable cars the insurance company listed are similar matches to yours. There might be some artificially lower sales, such as a sale to a family member, an auction after a repossession, or the vehicle was in significantly worse condition than yours. Once you have gathered and presented this evidence to the insurance company, it is time to negotiate.
In some circumstances, you might be able to have the insurer agree to repair the vehicle or increase the settlement offer, so you are reasonably compensated for the loss. Our Delaware County (Delco) car accident lawyers are available to lend our experience and legal expertise. Representing car accident victims means that our firm has years of experience working closely with insurance adjusters.
Pennsylvania Car Accident Lawyers Offering a Wide Range of Legal Services
An unexpected accident could result in a health and financial crisis. Car accident victims have to worry about their physical health, mental wellbeing, and the financial costs associated with medical treatment in addition to dealing with a damaged vehicle. At the Reiff Law Firm, our Pennsylvania personal injury lawyers are dedicated to helping people through this challenging time. Whether filing a lawsuit against a negligent driver, negotiating with an insurance company, or working for a fair settlement for a damaged car, we are here for you. Call (215) 709-6940 to discuss our services.