What Happens if Your Car is Totaled in a Car Accident?

If you are involved in a car accident, it’s very likely that your car will be damaged to some degree. Some damage can be easily repaired at an auto shop, but if the damage is extensive, the car may be totaled, which means it is either beyond repair or so damaged that it is not worth fixing. What happens if your car is totaled in a car accident? Here’s what you need to know:

How does an insurance company decide if your car is totaled?

Generally, a car is totaled when the cost of necessary repairs is greater than the actual cash value (ACV) of the car. However, the insurance company may declare that your car is totaled even when the cost of the car’s repairs are less than the ACV. Each state has its own laws regarding how insurance companies can determine if a car is totaled or not. In California, an insurance company will use this formula, known as the Total Loss Formula (TLF):

Cost of Repairs + Salvage Value ≥ Actual Cash Value

If the cost of the car’s repairs combined with the salvage value of the car is greater than or equal to the actual cash value, then the car is totaled.

What happens after an insurance company declares your car is totaled?

If your car is totaled, the insurance company will offer you a check for the ACV of the vehicle, which you can use to purchase a new vehicle. If you accept the offer, the insurance company will get to keep your vehicle so they can sell scrap metal or any parts that are still functional. If you don’t believe the offer is fair, meaning you think the car is worth more than what was offered, let your attorney handle the negotiations with your insurance company.

Many people have a hard time letting go of their cars, even after they are totaled. Some people may think that it’s worth it to repair the damage, while others are just too attached to say goodbye. Fortunately, you don’t have to give up your car just because it is totaled. If you want to keep your vehicle, the insurance company will pay you the total loss minus the salvage value. You can then either repair the car on your own or sell it.

Don’t make this decision without the help of an experienced personal injury attorney. Contact James Rush at Rush Injury Law today for the legal guidance that you need to recover compensation after a car accident. To schedule a free consultation with our team, call 415-897-4801 or fill out the online form on our website www.rushinjurylaw.com .