How Much Will Insurance Pay For My Totaled Car?

How Much Will Insurance Pay For My Totaled Car?

Being involved in a car accident is stressful as is, but watching your totaled car be towed away can set you over the edge. Even though it may feel like the end of the world right now, it’s not. You might be wondering how much insurance will pay for a totaled car. With the right insurance and assistance from an experienced car accident lawyer, you can get back in the driver’s seat in no time.

Understanding Total Loss

A car insurance company decides a car is “totaled” when the cost to repair it exceeds its value in the Kelley Blue Book. This is called “book value,” which is just another way to declare a vehicle’s market value. 

Kelley Blue Book is the golden standard for determining a car’s value because it keeps track of what every make and model sells for.

Most states have a threshold for determining a total loss, but generally, car insurance will not cover repair costs if the repairs cost more than your car’s worth. 

If your insurance company decides that your car is totaled, you’ll be reimbursed for the book value of your vehicle.

How Insurance Companies Calculate Payment

As mentioned, most states have a threshold for determining a total loss. Some states may not have a threshold and instead use a total loss formula (TLF) to calculate payment. 

In Arizona, that threshold is 70% of its Actual Cash Value (ACV). In Utah, payment is found by way of the total loss formula. The TLF looks like this: Cost of Repair + Salvage Value ≥ Actual Cash Value.

Actual Cash Value (ACV) is the amount equal to the replacement costs minus any property damage. Replacement cost is money the insurance company could reimburse you for your vehicle.

Types of Coverage for Totaled Cars

When it comes to car insurance coverage, you have options. Below are several types of coverage options that can help you with your totaled car.

Collision Insurance

This coverage pays for damages to your car caused by a collision with another vehicle or object. If your car is totaled after colliding with a vehicle, object, tree, or guardrail, auto collision insurance will cover the damages regardless of who is at fault.

Comprehensive Insurance

Comprehensive car insurance covers damages caused by fires, floods, severe weather conditions, or any other circumstance beyond your control. This type of insurance can also cover your vehicle’s value, not including your car insurance deductible. 

Comprehensive insurance can also cover repairs for vehicles that were stolen and then later found.

Gap Insurance

Guaranteed Auto Protection (GAP) insurance is an optional add-on to your coverage. If a car is declared a total loss, this insurance addition helps bridge the gap between the amount owed on the vehicle and the ACV. This means you won’t be responsible for repaying the remaining balance on your car lease.

New Car Replacement Insurance

Unlike GAP insurance, New Car Replacement insurance is an optional type of financial protection that covers a brand-new vehicle. However, you will still have to make payments on your lease. New Car Replacement insurance is recommended for those insuring vehicles that are less than one year old and have less than 15,000 miles.

Steps To Take After Your Car Is Totaled

The best piece of advice we can give you following a car crash is to stay as calm as possible. We understand that staying calm is a tall order, but it’s really important to stay proactive rather than reactive during this time. Here are some tips.

1. Immediate Actions Post-Accident

Prioritize your safety, check for injuries, and call law enforcement. If you were in a collision with another vehicle, swap information with the other party and collect names, addresses, and insurance details. Document the scene by taking pictures of damages and relevant details and obtain any surveillance footage if possible. 

From there, you should seek immediate medical attention regardless of how minor you think your injuries are.

2. Filing a Claim With Your Insurance

Report the accident to your insurance company, but give them any details until you’ve spoken with an experienced car accident attorney. If you were in an at-fault accident, anything you say to insurance can be held against you during legal proceedings. Give yourself the best chance at receiving maximum compensation by contacting the team at Esquire Law.

5. Contact a Car Accident Attorney

Contacting an attorney is one of the smartest moves you can make following a collision. Car accidents are complicated and representing yourself is extremely hard. Esquire Law takes the added weight off your shoulders so you can fully recover without the extra stress. 

With a proven track record and countless success stories, Esquire Law is ready to take on your case. Contact us for a free evaluation.

4. Negotiating With Insurance Companies for a Fair Settlement

Make sure you understand your insurance policy before negotiating. That being said, you have every right to negotiate with an insurance company for a fair settlement. We know that you might want to settle early, but settling early can result in you not receiving the compensation you need. Leave the negotiating to the pros and contact Esquire Law.

5. What Happens To My Car?

When your car is totaled, it’ll either be auctioned off to a salvage yard or you can keep it. More often than not, your car will be towed away to a salvage yard unless you’re permitted by law to take it home. If you keep your car, it will receive a salvaged title.

You can also give your totaled car to charity for a tax deduction.

Maximizing Your Insurance Payout

You have a right to negotiate with your insurance company for a better payout. If you’re going to do this, make sure you have enough supporting documentation to back up your claim. This documentation should include your vehicle’s estimated retail value, recent sales, and a list of your car’s features.

Keep in mind that your insurer may reject your counteroffer. If this happens, you can either reach out to your state’s insurance department or contact Esquire Law for additional legal assistance. Our team is available 24/7 and ready to take your call.

Get Help Navigating Insurance Payouts for Totaled Cars

If you’ve recently been involved in a car accident in Arizona or Utah, you’re in good company. If your car was totaled, Esquire Law can help guide you through the legal complexities of insurance payouts and assist you in achieving the highest compensation available.

Through superior representation and a commitment to our clients, we promise to fight for your rights. Don’t negotiate with insurance companies alone. Choose Esquire Law today. Our lawyers are ready to take your call no matter what time or day it is—and the best part is that it’s 100% free and confidential. 

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