Car bordering the threshold of total loss

Submitted by AdviceWanted on Fri, 11/02/2007 - 17:25

I contacted my insurance agency this morning regarding the status of my claim. I was told that my car has been determined to be "borderlining the threshold of a total loss" per the auto body shop. Because of this, a new adjuster has been assigned to my case and will be sent to the shop to assess my car himself.

Can you tell me what this means exactly? Is this a simple case of it's really borderlining (and quit reading too far into it), or is this insurance lingo that has a potential double meaning (aka they know more than they're willing to share)? Given this situation, do you believe the insurance company is more prone to sway to one side over the other (repairable vs total loss)?

Thanks for your assistance. I realize this may be a common sense question but the more I read about auto claims the more I learn they like to play the run around game. A little clarification wouldn't hurt as I've already been delayed a few days because of a towing issue and I'm starting to collect a few ants in my pants because I, at this point in time, need to start looking into alternate options in the event that my car is a total loss. I'm currently in a rental car per my insurance policy.

Thanks a ton for your time and assistance.

Posted: 03 Nov 2007 05:33 Post Subject:

Probably the insurance company was just going to use the shops estimate of the repairs but that amount was very close to the total loss threshold (usually an insurance company will total a vehicle when the repair cost reaches 80% of it's value). Once this was realized, the insurance company is going to send out their own person to look over the repair cost to confirm if it's a total loss. Totalling out a vehicle is not something an insurance company takes lightly. They have to be able to stand behind this decision. They won't take that stand having to say, "it's a total loss because Jimbo's Collision says it was". They will have their own person write up the repair cost according to their own guidelines.

So yes, it really is a boarder line. This happens all the time. A good carrier can play with the numbers to benefit the insured. If its just a question of a low value of the vehicle and still minor damage, they might be able to play with the numbers a little to make the vehicle "repairable'. If it's something like major frame and/or body damage, then it's probably in every one's best interest to just total out the vehicle and move on to another vehicle.

Posted: 03 Nov 2007 07:10 Post Subject:

"borderlining the threshold of a total loss"

-Nice phrase. :)

I think they have tried to say that the cost of repairing your car is likely to exceed the market value of it. If so happen, they will then declare your car ‘total' and will settle the claim by paying the actual value of the vehicle.

Take care,
Alaska-Usher

Posted: 03 Nov 2007 08:30 Post Subject:

Hi AdviceWanted, lemme first clear the cloud-of-doubt from your mind. Vehicle insurance claims are not always a run around business. In fact, most carriers try to work in favor of their policy holders. You might have heard the telltales, but that is only one side of the story.

The posters are quite right in explaining what it could mean by bordering the total loss threshold. But, how will you know what the threshold actually is?

Call up your insurer and ask what the threshold amount is. Some may declare a car total if the repairing cost exceeds 70% of the value of the car. But for some others it can be 80%. Normally, it ranges between 70%-90%. This piece of information will help you to ascertain the market value of the car. You can consult the blue book also in this regard. This way you can actually compute the amount you may receive from the insurer in case the car gets ‘totaled'. Simultaneously, try to find out the cost of repairing for the damages. This will help you in decision making.

Hope the input helps.

Rupert

Posted: 03 Nov 2007 09:50 Post Subject:

Hello AdviceWanted and welcome.

There are three ways a vehicle totals. Economic total=ACV (actual cash value) of vehicle, less the salvage value (either contracted, or bid or percent all companies handle their salvage a certain way) equals the amount you can spend to repair the vehicle anymore (even a penny) and the vehicle is a total loss...Obvious Total Loss (OTL), vehicle is damaged so badly that rebuilding even if less than economic loss would be unsafe, (ie complete fire, water thru the dash, firewall or other 'unserviced' part damage beyond repair)...last is State mandated total loss threshold, most state now have a percentage (as mentioned) my state and bordering one just raised it from 75-80%, if the cost of repair is over (whatever) the percentage the vehicles ACV it is a total loss..

ACV of the vehicle is less (generally a percentage dependant upon the year) any pre-exsisting damage.

Many many vehicles are 'borderline' totals, they usually require more tear down, the adjuster must ascertain all hidden damage and potential for any 'open' items. Some companies also have 'total loss' adjusters, and this might well be the case in yours. Or adjusters that handle the really hard hits. Or as tcope mentioned maybe use the shop estimates but require one of their adjusters inspection (also to get an correct ACV), in the case of a total or borderline.

Your company isn't doing anything wrong or 'jerking you around' they are just doing their job. The last thing they want to do is 'fix a total' (start repairs, nearly finish, find some more hidden damage, that pushes it over the thresold). Try and be patient, they really are looking out for you.

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