What happens if your car gets totaled

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Skip to main content Toggle navigation Log in. Edit location. Select a product to get a quote. Register new account Pay your bill. Get your ID cards. Updated: May A car is generally considered totaled when the cost to repair the car exceeds the value of the car. In other cases, the insurer determines whether a vehicle is considered a total loss. Quality Auto Coverage Starts Here.

Get a quote Find an agent. If you're involved in a car accident, there are a few basic steps to follow before and after your vehicle is considered totaled: Contact your agent and initiate an insurance claim. Your insurer will determine whether the vehicle is a total loss, based on repair costs. Your insurer will issue payment for the actual cash value of the totaled vehicle, minus your deductible on your comprehensive or collision coverage.

Rental Reimbursement Coverage. This content is for informational purposes only and may not be applicable to all situations. Coverage subject to terms, conditions, and availability. Policy issuance is subject to qualifications. Connect With Us. Update Below. ZIP Code. If your car is totaled, meaning your insurer has declared it a total loss, the vehicle is typically unfixable or would require repairs that exceed the vehicle's value.

Hop in the driver's seat and buckle up as we explain what it means when your car is totaled, whether your insurer will cover a totaled car and more. A standard auto insurance policy normally won't pay to fix your car if it's been totaled.

When your car is totaled, the insurance company has decided the repairs would cost more than the car is worth, or that the car is simply beyond repair. In some states, an insurer might be required to total your car if repair costs would exceed a certain percentage of the car's value. Once a car is totaled, your insurer might then owe you the actual cash value of your car, depending on what your auto insurance policy says.

Your insurer will figure out the actual cash value of your totaled car by considering the following information about the vehicle:. Actual cash value refers to the sale price the car could have reasonably fetched on the open market before it was crashed. It differs from another term you may have heard regarding auto insurance: replacement cost value. Replacement cost refers to what it would cost to purchase a brand-new car comparable to one that's been totaled.

Not all auto insurance policies offer replacement cost as an option. Keep in mind that your auto insurance premium will be higher if you go with replacement cost value coverage instead of actual cash value coverage.

Does Insurance Cover a Totaled Car? If an insurer totals your car, it's typically covered by two parts of your policy: comprehensive coverage and collision coverage. When you have a car loan or lease, those two types of coverage normally are required. They aren't legal requirements on a car you've paid off, however—the decision to carry comprehensive or collision coverage is up to you. Without coverage beyond the liability insurance that's required in almost every state, you might have to pay out of pocket to replace your totaled car especially if you're at fault in the crash.

Comprehensive insurance covers damage or disasters not related to a collision. Meanwhile, collision insurance applies when your car is damaged during a crash with another car, an object or property. In some cases, an insurer might not cover a claim when your car is a total loss. Here are five possible reasons for your claim being denied:. Take note that each insurance company uses different criteria for declaring that a car is a total loss.

However, a car that's totaled by one insurer probably would be totaled by another. Insurance experts recommend continuing to make loan or lease payments until the insurance company sends the claim payment to your lender, even if you can't drive the car. Once the lender is paid off, what if you still owe money on the car? Unless you have what's known as gap insurance, you're responsible for making up any difference between the claim payout and the loan or lease balance. Keep in mind, though, that gap insurance kicks in only when you've already got comprehensive and collision coverage.

Car accidents, even those that result in a financed car being totaled, won't directly impact your credit scores. Actively scan device characteristics for identification. Use precise geolocation data. Select personalised content. Create a personalised content profile. Measure ad performance. Select basic ads. Create a personalised ads profile. Select personalised ads. Apply market research to generate audience insights. Measure content performance.

Develop and improve products. List of Partners vendors. With more than 10 million car and light truck accidents occurring each year, you may have to deal with one at some point. If the accident is bad enough that your car is totaled , here is what you need to know and do. Depending on your state and whether you or another driver were at fault in the accident, the damage to your car may be covered either by your insurance policy or the other driver's.

If you file an insurance claim, your insurance company and possibly the other driver's will assign a claims adjuster to your case. The adjuster's job is to determine how much their company should pay out on the claim. The adjuster may conclude that your car is totaled, or a total loss, if it isn't worth repairing or isn't repairable at all. Insurance companies have their own formulas for making that determination. Claims against the other driver will fall under their policy's property damage liability coverage.

If your policy is the one that will be paying for the damage to your car, either your collision coverage or comprehensive coverage —if you have any—will be involved. Collision coverage is for damage to your car caused by an accident with another vehicle, while comprehensive coverage is for damage caused by something else, such as a fire or fallen tree. If your car is totaled, here are seven ways you might consider handling it. The easiest way to deal with a totaled car after an accident may be to simply let the insurance company pay you.

Depending on the insurance laws in your state, this might involve:. Note that if you believe the insurance company's offer is too low, you can challenge it. If you opt for a cash payment and still owe money on a car loan, the insurance company will generally make the check out to both you and your lender.

After your loan has been paid off, any remaining money is yours to keep. However, if the insurance company's payment is less than you owe on the car, you are responsible for paying the difference.