Car accidents are stressful and, in some cases, result in a vehicle being “totaled.” But what exactly does it mean when a car is declared totaled, and what should you do if it happens to you? This guide will walk you through the meaning, the process, and your next steps after your car is totaled. https://sites.google.com/view/cashforcars-perth/vehicles-we-buy/undrivable
What Does "Totaled" Mean?
A car is considered "totaled" when the cost to repair it exceeds its current market value. In other words, if fixing the damage costs more than the car is worth, insurance companies typically deem it a total loss. This doesn’t necessarily mean the car is completely destroyed. Even vehicles with repairable damage can be totaled if repairs are too expensive compared to the car’s worth.
Each insurance company has its own formula and threshold. In some states, if the repair costs reach as little as 70–75% of the car's value, it may be totaled. Insurers also factor in additional expenses like rental cars, towing, and labor when making this determination.
What to Do if Your Car is Totaled
-
Contact Your Insurance Company:
Once your vehicle has been inspected, your insurance adjuster will determine whether it’s a total loss. If so, they’ll offer a payout based on the actual cash value (ACV) of the car prior to the accident. Be sure to research the value yourself to ensure you're getting a fair deal. -
Understand Your Options:
After a total loss declaration, you typically have two choices:-
Accept the payout: The insurer buys your car and you receive a check for its pre-accident value.
-
Keep the car (salvage): You may choose to retain the vehicle and receive a reduced payout. You can then sell it as-is or have it repaired at your own expense.
-
-
Clear the Loan (if applicable):
If you still owe money on the car, your insurance payout will go toward that loan. If the payout is less than what you owe, you’ll still be responsible for paying the remaining balance—unless you have gap insurance, which covers the shortfall. -
Sell Your Totaled Car:
If you choose to keep your totaled vehicle or if the insurer lets you, you can sell it to a salvage yard, scrap buyer, or a company that specializes in buying damaged cars. Services like Cash for Cars Perth can help by offering cash for totaled vehicles in any condition, saving you time and effort.
Final Thoughts
Having your car totaled is never ideal, but understanding what it means and how to navigate the situation can make it less overwhelming. Always stay informed about your car’s value, insurance policy, and available options. Whether you choose to take the payout, keep the vehicle, or sell it as-is, the key is making a decision that works best for your situation.