Last updated: October 2023
Even a small fender bender can make your heart beat a little faster. A full-on, metal-crunching crash can be much scarier. But no matter how big or small the crash is, they can both lead to a seriously damaged ride. However, at what point is your car considered “totaled” from all the damage? If you’re ever involved in an accident, we want to help make sure you're equipped with the right knowledge. Here’s when your car might be considered a total loss, how insurance companies work to resolve the situation, and the types of car insurance coverage that could apply in a totaled car situation.
What does totaled mean?
A car is typically considered to be totaled, or a total loss, when the cost to repair the vehicle is higher than its actual cash value (ACV), says Claims Journal. Sometimes that means your car is smashed and obviously beyond repairs. Other times, your engine could still function, but the car is in bad enough shape that the cost to repair it is more than what it is worth (this is sometimes called an "economic total loss"). When you consider the cost of these common repair jobs, according to Experian, you begin to see how repairs might be more expensive than the car itself. Remember, you might pay less or more depending on your vehicle and which repair shop you choose.
- Replacing a windshield: $200-$400
- Repairing scratches: $150-2,000
- Replacing an airbag: $1,000-$1,500 per airbag
- Repairing a suspension: $1,000-$5,000
- Repairing frame damage: $600-10,000
- Replacing an engine: $1,000-$7,500
Ultimately, the criteria for deciding when a car is a total loss and when it can be repaired varies based on your insurance company and your state's regulations.
What if I get in an accident & think my car is totaled?
Follow the same steps you'd take after any other car accident, no matter how big or small the accident.
- If you can, pull over onto the shoulder of the road, out of the way of traffic. Turn on your hazard lights.
- Check yourself and your passengers for any injuries, then dial 9-1-1. The operator can contact any emergency services you need, from police to an ambulance, if necessary.
- If another vehicle was involved in the accident, get the other driver's name, address, vehicle info, and insurance information. Take plenty of photos. That'll make police reports and insurance claims much easier.
- If the collision occurred with an object (like a tree or telephone pole), do your best to stay safe and calm until emergency services arrive. Take pictures of any damage to the property and to your vehicle.
Sometimes a car accident resulting in a total loss may require immediate emergency treatment, meaning you cannot take photographs of the crash scene or get the other driver's information. Therefore, ask a family member or friend to take pictures and help you document what is needed. If your car is undrivable, it will need to be towed, and the costs associated with the tow will depend on your policy and who is at fault.
Report the claim to the insurance company. If another driver was at fault, his insurance company would be responsible for adjusting/covering the claim. If you have comprehensive and collision coverage and you were at fault, the other driver was uninsured, or your damage was caused by another covered event (like if you hit a deer or your car was vandalized), your insurance company will evaluate your claim, appraise the value of the damage, and determine a fair settlement. Here's a bit more detail about comprehensive and collision coverage:
- Comprehensive coverage will help pay for your vehicle to be repaired or replaced in the event that your car is damaged by a covered incident other than a collision, like if your car is stolen or vandalized.
- Collision coverage will help pay for your vehicle to be repaired or replaced if your car hits another object, overturns in an accident, or is hit by a hit and run driver.
With the right coverages, your insurer will help pay for a new vehicle if it's deemed a total loss, whether after a major collision or if your car is stolen and not recovered or recovered with extensive damage. Either way, this is when it really pays to have auto insurance (plus the right amount of coverage for your needs).
What happens if you don’t agree about your car’s ACV?
If you and your insurer disagree, you will typically have the right to have an independent appraisal. This process would be described in the Appraisal section of your policy. If you and the at-fault driver's insurer disagree and you have your own collision coverage, you can file a claim under your own policy. Your insurance company will then pursue reimbursement from the at-fault driver's carrier, including any deductible you paid. If you don't have collision coverage, you could seek legal advice or reach out to your state's department of insurance for assistance.
What happens if you keep your totaled car?
As noted above, a totaled car could still be drivable, but it just costs too much to repair. If you opt to keep your car in that case, the insurer will calculate the ACV and, in most states, the applicable taxes and fees, and will then deduct from that total the "salvage value" (scrap value) - that would be your settlement amount. Your car's title will likely have to be re-branded as a "salvaged title" by your state's department of motor vehicles.
If your car is totaled and you do not retain the vehicle, a few things will happen next. You'll likely be asked to remove your license plates and personal items from the vehicle and leave your keys with the insurance adjustor. Then, you may need to notify your finance or leasing company of the claim and give them permission to speak to your insurance company. As part of the settlement, you'll give the insurance company authorization to transfer the title to the company since you effectively sold them your car. Your insurance company will take care of the damaged vehicle from here on out! You may receive payment for the total loss, but it depends on whether you owned, leased, or financed your vehicle. The payment could go to your leasing or finance company—it just depends on your situation. Keep in mind that the actual steps following a total loss claim will vary based on your state, insurance company, and coverage.
Are you covered for a total loss?
From minor fender benders to fatal crashes, car accidents happen every day. If you were involved in one of these accidents, would you be able to handle the cost of repairs or the cost of buying a new car? Double-check your car insurance policy to make sure you and your family have a level of coverage that you're comfortable with. To learn more about coverages that could help pay for a total loss and how to update your policy, give one of our friendly agents a call today at 1-877-463-4732.