Around 27% of all collision claims in the U.S. are deemed “total losses” by the insurance provider. Whenever a vehicle is severely damaged in an accident, one of the most pressing questions to ask is: Is my car totaled?
You could park your car at home and have the best day in the world, only to wake up to post-hailstorm damage that renders your vehicle worthless. Or you could be at an intersection and someone texting hits the brakes a little too slowly, totaling the side of your newly acquired minivan.
As a leading body shop in Atlanta, we frequently see totaled cars and want to provide clients with a bit more information so that, when the worst does happen, everyone is prepared for the next steps. Here is everything you need to know when dealing with a total loss vehicle.
What Does A Totaled Car Mean?
A totaled car means you’ll need a body shop near me. It is a vehicle considered a total loss by the insurance provider. It’s not really about what the damage looks like. Think of a totaled car as a math formula.
If the cost of repairing the vehicle’s damage is greater than a certain percentage of the car’s actual cash value (ACV), then it’s a loss. The percentage varies depending on the state, region, and insurance provider. For example, around Georgia, you can expect a 75% value. If the car is worth $10,000 and the repairs are more than $7,500, you’ve got a total loss car.
What Happens When Your Car Is Totaled?
Many drivers visiting our automotive body shop wonder what happens when your car is totaled. That confusion makes things much more stressful, so let’s clear the air a bit.
Once your insurance provider says you’re out of luck and you’ve got a totaled car, you have a few options. You can:
- Take the payout offer based on the car’s pre-accident market value (found on KBB and other resources).
- Let the insurance company take ownership of the car when you accept the cash.
- Keep the vehicle under a salvage title, which will affect its insurability and resale value.
- Keep the money and buy a new car.
- Work with a professional paint and body shop to restore the car to its pristine condition.
The only real factor you need to know is whether the provider classifies your vehicle as a total loss. They won’t pay for repairs once that happens. That is why working with your provider and doing your research before negotiations is so important.
A quick note: A salvage value means the amount of money the insurer would expect to get from selling your car to a salvage yard. It’s all a calculation for the insurance providers, which can be a real drag if you have a custom, historical, or vehicle with a lot of personal value.
How Much Will Insurance Pay For My Totaled Car?
Let’s take the question of how much will insurance pay for my totaled car a bit further than just ACV and whether or not it is salvageable. The amount of money you actually receive isn’t just based on ACV minus repair costs.
Anywhere from 110 to 150 million auto loans are out there covering the cost of vehicles. That means you have a good chance of owing a loan balance on your total loss car. Also, if you have a deductible, you can expect to pay that out of your cash reward.
So, if you have an ACV of $10,000 for your Honda coupe, a deductible of $500, and an outstanding debt of $4,000, you can expect to receive a check for $5,500.
Here is where the hard math happens. You have to decide whether the cash payout is enough to make a down payment on a new vehicle or if the cost of repairing the vehicle with a qualified auto body shop near you is a better financial decision. That is why we always recommend getting a repair quote from our experts at Atlanta Auto Collision in Smyrna, GA, before agreeing to anything.
What Steps To Take With A Total Loss Car?
No matter which way you decide, knowing what will happen after getting a total loss vehicle is essential. You can expect a basic journey of:
- File an Insurance Claim: The moment you’ve had damage done to your car, you need to let your insurance provider know. File a claim and be sure to include all relevant details, photos, witnesses, and supporting information.
- Keep Documents: Maintain a copy or original files of all documentation. That includes police reports, repair estimates, damage photos, and communication with insurance providers in case you need to settle.
- Get a Professional’s Opinion: Bring your car into Atlanta Auto Collision and receive an experienced and fully qualified assessment of the damage and how much it will cost to repair.
- Research: Before accepting any offer, consider the fair market value of your totaled car. Insurers may undervalue your vehicle, and you want to ensure your insurance payout (including gap insurance) meets the mark.
- Contact Lender: This is a crucial step, especially if you have an auto loan or are leasing your vehicle. Insurance providers may send the payout to the lender before you, so you want to obtain all the documentation you can before anyone clears a loan or lien.
- Negotiate the Claim: You do have some power to negotiate the settlement amount for your total loss car. Use your research, damage repair estimate from a professional auto body shop, receipts for recent repairs or upgrades, and comparable car values in the Atlanta area to help.
Finally, be sure you’re working with a fully credentialed paint and body shop. You want a team that understands what insurance providers will offer and will provide a trusted, detailed explanation of the repairs and the steps that will follow.
What If I Want To Keep My Totaled Vehicle?
You do have the right to keep your total loss vehicle. There are some caveats you should be aware of before making this decision. Any future or current settlement will be based on the car’s salvage value, which could be much less than you want.
If you do keep the vehicle, it will operate under a salvage title. That will lower the resale value and make it slightly harder to finance or insure. It can also be a pain in the backside for any Georgia driver who needs safety and emission testing in the future.
You 100% need to know the current total repair costs and future maintenance concerns based on a professional assessment from a team like ours at Atlanta Auto Collision. That is the information that you can base your decision on.
Know The Facts & Protect Your Wallet
Anyone dealing with a totaled car is going to face a rough road ahead. Information is key at this point. You need to collect all the data you can about potential payouts, damage repairs, and future usability of your vehicle.
Protect your wallet from a financially devastating situation. Understand what happens when your car is totaled and do your homework on fair value. You can take control of the outcome by partnering with a professional team like ours at Atlanta Auto Collision. We have the experience, clarity, and certifications to give you a fair and detailed estimate of future repairs.
Don’t try to navigate a total loss vehicle by yourself. Give us a call today and let’s find out what will work best for you, your car, and your family’s needs.