When your car is beyond repair because of an accident or costs more than the Actual Cash Value (ACV) of the car, it is considered totaled. When a car is totaled, only the salvage value of the metal is considered when determining the value of the car.
How is a car determined to be totaled?
- The Individual's point of view: For an individual a car is totaled if the damage is beyond repair or if the owner cannot afford to get the car repaired. This usually occurs when the owner has only the minimum amount of insurance.
- Insurance point of view: A car is 'totaled' if the cost of repairing the car exceeds the cost of replacing it. Insurance companies consider only a percentage of the current worth of the car, and it is important that individuals are aware of the percentage their insurance companies will consider. Normally the percentage insurance companies deem the car totaled ranges from 51% to 80% of its current market value.
Settlement procedure for a totaled car
If the cost to repair the car exceeds the percentage fixed by the company, it will make a settlement rather than get it repaired. This settlement will take into consideration a few other factors like:
- The make of the car.
- The model.
- The condition of the car and the mileage it has.
- Make of the car
- Condition of the car and the mileage it offers
- Comparison with other similar vehicles in the same area
How to keep your totaled car
- Talk to your insurance claim adjuster and fight for your car. Remind the agent that you are the one paying the premium and that you have the right to change insurance companies.
- Document all maintenance performed on your car. This will help you decide whether or not you should accept a particular settlement offer.
- Insurance companies offer their own choice of repair shops. Use your own discretion. However, do your own research and also on the repair shop suggested by the insurance company.
- If you wish to retain your totaled car, the adjuster will deduct the salvage value while determining the final settlement offer. You may try negotiating with your adjuster to settle for a lower salvage value of your car.
- If you want to know the ACV of your car, don't depend on your insurance company. Get a second opinion, and do your own research online or at your local library.
- Totaled car buy back
- When is a car totaled?
- Purchasing totaled car back from insurance company
- Will totaled car affect credit?
- Retaining totaled car
- Getting estimate for a totaled car
- How much is the totaled car worth?
- Settling a totaled car
Total Comments: 152
Posted: Sat Feb 16, 2008 08:37 am Post Subject: What if I want to retain my totaled car?
If you want to retain your car, which has been "totaled" according to Insurer, then here is the formula: Money in your pocket = Car's market value - salvage value (Insurer will tell you) - TTL (new salvage title will be issued) - the Deductible.
Posted: Tue Mar 18, 2008 05:35 am Post Subject: Post shifted
Hi Blackbelt4, I split your post to this thread,
Posted: Mon Jun 30, 2008 07:48 pm Post Subject: Where is it defined that the insurer gets the salvage value?
In KY, our SF policy does not mention anything about a salvage value or that they gain ownership if they give you a settlement for a "totaled" car. Everybody seems to think that the Insurance companies naturally get the salvage value when you keep your car but nowhere in the policy and nowhere in KY law does it state that this is the case. The insurer must get us to agree to this salvage value before they give a settlement. Again, the term salvage value does not exists in the policy or the state law. Why is everyone willing to pay this when you already own the car?
Posted: Mon Jun 30, 2008 11:20 pm Post Subject:
You are however, in effect selling it to them for the ACV...correct? So they pay you the ACV and you sell/hand over ownership to them for said ACV. If you want to keep it how can you sell it and keep it at the same time? You can't... Now I'm not saying that the salvage value shouldn't be negotiated it certainly can be....But if a vehicle is totaled and owner wishes to retain it, then they owe that salvage recovery, (what the carrier would get). Right?
Posted: Tue Jul 01, 2008 12:05 pm Post Subject:
If your home is destroyed in a tornado and the insurance company gives you a full settlement, does that mean that they own your house? Would you have to pay them for rebuilding on the same property? Again, nowhere in the policy or in state law does it say that the insurance companies automatically gains ownership of your car if they pay you ACV.
Posted: Tue Jul 01, 2008 12:20 pm Post Subject:
If your home is destroyed in a tornado and the insurance company gives you a full settlement, does that mean that they own your house? Would you have to pay them for rebuilding on the same property?Of course not but there is a big difference between not only the policys but 'real' vs 'personal' property....
Again, nowhere in the policy or in state law does it say that the insurance companies automatically gains ownership of your car if they pay you ACV.Are they buying the car from you? Yes, they are..therefore if they purchase the vehicle they are the owners...I'd do some checking in next couple of days, and get the laws for you...(too much 'real' work today :wink: :roll: )
Posted: Tue Jul 01, 2008 03:21 pm Post Subject:
Are they buying the car from you? Yes, they are
You made this statement without having any evidence to back it up. BTW, I have asked many SF employees high up in the company and they all said "There is nowhere in the policy that states that we own your car after we pay you the ACV or that you owe us a salvage fee if you decide to keep your car. It is just always done that way." I'm sorry but I don't accept that as an answer.
Posted: Tue Jul 01, 2008 11:04 pm Post Subject:
I'm sorry but I don't accept that as an answer.That's ok, it wasn't a full answer...remember...I said,
I'd do some checking in next couple of days, and get the laws for you...(too much 'real' work today )
Posted: Tue Jul 01, 2008 11:20 pm Post Subject:
Ok, sorry, it took me about five minutes..
You made this statement without having any evidence to back it up.In response to me saying
Are they buying the car from you? Yes, they are..therefore if they purchase the vehicle they are the owners
So here ya' go....This shows that you MUST sign over ownership (ie selling the car to the carrier).
MO standard auto police says regarding coverages F&G (collision and comp), under the heading, Claim Settlements...
"If we elect to pay the comparable value of any item we will do so only if the owner of that items signs and delivers to us all legal documents we may request to give us full ownership of it..."
and (cause I know it's coming)
Comparable Value means:
a)The depreciated worth of the vehicle or part imeediately before the accident
b) plus any sales tas, luxury vehicle tax based on the depreicated worth of the vehicle or part immediately before the accident
c)plus any other taxes or fees you must incur to acquire ownership of another auto or part to replace the damaged vehicle or part with one of equal value.
Same as ACV really...I don't know why they changed it but they did a few years ago...
Here's the thing..if it were not in the policy you can bet your bottom dollar it wouldn't happen ON EVERY SINGLE TOTAL LOSS SETTLEMENT...Now, I don't know who up high in SF you talked to but if you talked to someone in claims, they should know this...As you know most policys are standardized...If you want tell me again your state, and I'll try and pull a standard policy for that...
Now of course if a person fails or refuses to sign over a clear title (and have had this happen it's lost or something) then the adjuster issues payment to the owner MINUS the salvage value, and they retain it...OR if they have the title refuse to sign it over, and do not want to retain (and pay) for salvage value then the claim just isn't paid..
Posted: Wed Jul 02, 2008 12:30 pm Post Subject:
First of all, I do appreciate you answering these questions. However, my KY policy does not state anything like your MO policy. I have since learned that the TN policy states something very similar to your MO policy. So, I agree that if the policy states what you are saying then there would not be any question as to what has to take place. But currently my KY policy does not state anything about the insurer becoming the owner after paying ACV and/or mention anything about a Salvage Retention charge. Even though we have asked repeatedly that State Farm show us where it states this kind of information they cannot. Even the Dept. of Insurance cannot show us in KY law where these kinds of statements exist even though they can misquote sections of law from memory. Yes I did say misquote, because they will tell you one thing but then cannot show you the section of the law that it came from. Also, I have spoken to the Claims Representative, his supervisor, and so on all the way up to the VP of Claims for KY,TN & OH. When I asked them about what we are discussing they just said that it is not in the policy but is in internal documentation but that they cannot show us those documents because they are work product. Maybe this information is in policies given out in other states but it is not in KY's policy. Our agent's assistant even said, well you should be seeing an addendum soon then.