Can you keep a totaled car?

Posted: Thu Sep 06, 2007 06:40 am Post Subject: totaled car buy back - when is a car considered totalled?

Hi carclaims, why you want to retain the damaged car? I know an emotional bonding is always attached to them but you also need to consider the cost associated with mending a damaged car. If the insurance company feels that it is damaged beyond repair then you also better take the amount they are offering and settle for a new car. There are lots of new models of cars available in the market :wink:

Posted: Thu Sep 06, 2007 07:44 am Post Subject: Thumb-rule of a totaled car

Well carclaim, it's quite natural for you to face the dilemma (here I will second what Carla had said about emotional attachments) but the Vehicle insurance company definitely has some logic behind declaring your car ‘totaled' (the insurance companies apply their own wits and theories about it). However, here is the ‘thumb rule'- the insurer may decide to ‘write off' your car if the cost of repairing exceeds the market value of the vehicle. In that case, they will only pay off the book_value of the car.

Now it may so happen that you feel that they are paying less than the value of your car. In such scenario, my dear friend, the ball will roll into your court. You are then required to prove that the car was worth more than the compensation amount at the time of the loss. And to prove it you may require to furnish evidences like- the car's mileage record, a declaration form the mechanic stating the car's value etc.

Hope this information will help you.

Juanita

Posted: Thu Sep 06, 2007 09:11 am Post Subject: Reconsider your decision about keeping your car

If you want to retain your car, inform that immediately to your insurer. Because, the chances of getting the car back normally reduces once the car enters the salvage yard. When your car gets ‘totaled' the insurance company will issue you a check that will leave you more or less to the same financial condition before the accident occurred. Then they will send the car to the salvage yard and will get it auctioned for its parts.

Now coming to your question (I am assuming that you have reasoned yourself enough before deciding upon keeping your car), you can keep it if the insurer allows you to do that. However, even if they let you keep the car they are still obliged to pay you the compensation minus their earning from the auction.

But in such scenario, you have to bear the extra amount required for getting it repaired. And, that's not all' you are also required to satisfy the specifications forwarded by the state motor vehicles regulation authority before bringing the repaired car back on road.

Regards, Fatman

Posted: Thu Sep 06, 2007 04:36 pm Post Subject: totaled car buy back - when is a car considered totalled?

fatman is right. We had a car that my son totaled and I decided to "keep" the car-why, I don't know!

Well, the way they do it here is, they (the insurance co) has a yard they have it moved to until it is decided if it can be fixed, or totaled out. They decided my cars damage exceeded the book value of my car, and had it deemed totaled.

I asked if I could keep the car, and was told, they will pay me a check, but I couldn't keep the car too. They did auction it off.

After carefull consideration, and advice from my husband, the car sustained too much damage, was an older car, and I would be throwing good money after bad

Good Luck to you!..Karen

Posted: Fri Sep 07, 2007 02:06 am Post Subject: totaled car buy back - when is a car considered totalled?

OP, and insurance companies obligation is to pay for your loss. So technically, if you had a vehicle with $1 of damage, they could declare it a total loss and pay you it's value less your deductible. That won't ever happen as it would cost them much more money and it would really upset a lot of insureds. I'll explain one more problem with this but let me point something else out. Many states require an insurance company to obtain a salvage title on a vehicle if the carrier would be paying around 80% of it's value in repairs. If a salvage title is required, the insurance company will consider it a total loss. As this is a good number, most insurance companies will use this as the threshold even if the state does not require it (as with this much damage there is bound to be additional damages found which would make the repair cost more then it's value). This is "when" an insurance company can declare a vehicle a total loss. Now to back up a little... there is another problem with declaring a vehicle a total loss when it has minimal damage. The owner of a vehicle can _always_ retain it. Many adjusters will tell you that you cannot but you can. It's your property so no one can force you to give it up and the loss can be settled without the insurance company obtaining the vehicle. Now here is the important part... you almost never want to do this. I can't get into all the reason why but I'll mention a couple. As mentioned above, the insurance company will then pay you the total loss settlement but less the vehicles salvage value. In most cases this won't work in your favor. I'll give an example: you have a $1500 vehicle with $1000 in damage and a $500 deductible. So the amount payable on a total loss is $1000 (value less ded.). Also, the salvage is $300. So if you retain the vehicle your only going to be paid $700. This does not work if you would need to have more then $700 in repairs made just to be able to use the vehicle. You might as well go out and buy a better vehicle and pay a little out of your pocket for it. I know keeping the vehicle may still sound like a good idea but here is the 2nd kicker... many insurance companies will also report the vehicle being a total loss to the state where it is titled (they are probably required to do this but some adjusters don't as it just means more work). If the state gets a report of the vehicle being a total loss, the DMV won't allow you to obtain tags unless you jump through a million hoops and give them your 1st born child. Again, very rarely is it to your advantage to keep the vehicle.

There is one situation where I will say it might be better... if the vehicle was a POS (piece of sh*t) to start with a something like a dented fender caused it to be a total loss. In this case it's worth more to the owner as a driveable vehicle then it's actual value.

There are a few other situations that can happen (Contract for Repair, etc) but I won't get into those as this post would be even longer. :)

Posted: Fri Sep 07, 2007 05:20 am Post Subject: totaled car buy back - when is a car considered totalled?

Hi carclaims,

First off- TCope, that was a great response.

Carclaims- I agree with other posters that you must have your reason for wanting to keep the car. Whatever, it's your car. I also agree that if you want it back, you better get on it. Once the wrecking yard gets ahold of it or it's parted out, your options are pretty much gone (unless you go and buy the parted-out car back yourself).

So...most insurers allow insureds to buy totaled cars quite willingly. That lessens the process for them, they don't have to devote the man-hours associated with processing the salvage, etc. They will either:

Deduct the cost of the value of the salvage from the final settlement you're offered, or
Settle in full initially, and then sell you back the salvage as a separate transaction.

In either case, you're stuck with a salvaged title, can never get an original title again, and won't (most likely) ever be able to sell it. So, my theory is that you want the parts. That can often be worth more than the total value of the car, depending on the car.

Good luck.

InsTeacher 8)

Posted: Mon Sep 10, 2007 11:24 am Post Subject: RETAINING TOTALED VEHICLES

HELLO !

Every time I total a vehicle, one of the first things I tell an owner is you will have to make the decision if you want to retain the salvage or if you want us (insurance company) to obtain it. Many many times with older vehicles it is the smartest thing to do. For instance it is company policy with the company I work for if a vehicles acv is 2500.00 or less the salvage bid will be $150.00 period, no need to call for a bid from the auction. It happens many times that an older vehicle has reached the total loss thresold and is still driveable. In the state I am in there are three ways that will total a vehicle. OTL (obvious total loss), meaning there is too much structural damage to even consider repairing it safely, ie firewall smashed, total burn etc. or a vehicle with an acv of 2500 have more than 50% of outter sheetmetal needing replaced. An economical total, cost of repair equals or exceeds, acv minus salvage, my state also has a percentage, if repair cost equals or exceeds 75% of acv (less sales tax and airbags) vehicle totals, (they just changed this law last week, think it is 80% now on 6 year old and new vehicles, and hail no longer 'counts'). In many instances especially with older vehicles it is the smarter thing for the owner to retain. You will have a salvage title, but in most states you can repair and take repaired vehicle to the highway patrol (in my state), they will inspect it, if passes the title will change to 'prior salvage title' although frankly this really doesn't help much, it will still lower the acv should it total again. Back to the question, many times an older vehicle say 2000.00 is totaled but still drives (legally), you can have partial repairs done, and maybe still get several more good years out of your vehicle. I have also seen in half the instances where an owner retained salvage, that they immediately sold the salvage at a much greater profit. If Ins company said (as in my companies case) salvage is worth 150.00 owner retains and immediate there after sold salvage either in the newspaper, or on auction, to a local rebuilder themselves for 500.00 or better, so in that case retaining was also the better decision. One other thing, in all states when a vehicle is totaled the owner is given some type of sales tax relief, some states pay the actual sales tax amount to the owner others issue a sales tax affidavit or credit, if you retain salvage you do NOT get this.........hope this adds to the prior well written and helpful posts....Good luck !!!

Posted: Thu Sep 27, 2007 01:49 am Post Subject: hi!

carclaims the same thing happened to our van. its 10 yrs old but still in a very good condition (til the accident). now the shop we went to said it could just be declared total loss by insurance... though it wasnt a definite estimate submitted to the insurance company yet. our reason for wanting to keep the van is not sentimental nor emotional. its more practical. the van runs perfect and very safe. its just the side door and fender that were dented. plus the back tire rim was also dented which we had already fixed and paid for (another loss for us if insurance company declares it totaled). it's more of body work thats needed.

but as lori mentioned, for the insurance company, its an "economical total". it's like saying, our loss for the insurance company's gain. either we keep the van or give it up to the insurance company we are at the losing end. if we NOT KEEP the van, with the amount they pay us.. it wont be enough to get a decent replacement used car nor enough for downpayment for a brand new car so monthly payments are low (our van was perfectly ok and fully paid off). if we KEEP the van, with the amount they pay us.. its wont be enough to have the damages repaired so it will pass dmv inspection and have it registered. so either way... its our headache and financial burden.

my question to lori is... is there a way we settle the issue with the insurance company? like say, they wont declare the van as total loss but pay us only the amount for acv minus salvage. that way we can have partial repairs done over time and not have to deal with dmv process and fees. is that possible?

Posted: Thu Sep 27, 2007 11:01 am Post Subject:

Good morning muuyymmuuy !

my question to lori is... is there a way we settle the issue with the insurance company? like say, they wont declare the van as total loss but pay us only the amount for acv minus salvage. that way we can have partial repairs done over time and not have to deal with dmv process and fees. is that possible?

plus the back tire rim was also dented which we had already fixed and paid for (another loss for us if insurance company declares it totaled).

our loss for the insurance company's gain

if we KEEP the van, with the amount they pay us.. its wont be enough to have the damages repaired so it will pass dmv inspection

like say, they wont declare the van as total loss but pay us only the amount for acv minus salvage. that way we can have partial repairs done over time and not have to deal with dmv process and fees. is that possible?

Posted: Mon Oct 29, 2007 09:19 am Post Subject:

Hi bksushi, welcome to ampminsure. Your post has been shifted to the following URL. Pls click on it to find the post.

http://www.ampminsure.org/claims/about3299.html

Thanks,
Lakemen