Were you in a car accident? You could be looking at needing substantial repairs to your automobile to get it running again. If the damage was mainly cosmetic, either your insurance company or that of the at-fault party will typically pay the cost of reasonable repairs. On the other hand, for more serious damage to your vehicle, your insurance company may decide to declare your car “totaled” rather than pay for repairs.
Insurance companies take steps to calculate the overall worth of your vehicle after being in an accident. After crossing a certain threshold of damage, they will deem your car to be totaled. Your insurer will take into account factors such as depreciation by consulting with databases including Kelley Blue Book.
Your vehicle will be appraised based on:
Even the location can impact the actual cash value since dealerships value cars differently based on local supply and demand.
The next step for insurance company adjustors is to determine the relative cost of repairing your vehicle. If it is determined the cost of repairing your vehicle is beyond the actual cash value, they may choose to declare your car to be a total loss and will issue you a check for the total loss amount.
Even if the repairs would cost less than the actual cash value, many states, including California, consider the car a loss depending on the ratio of repair costs to cash value. California permits insurance companies to default to using a formula if the costs of repairing your car and the value of salvaging it is more than the cash value. The salvage value is the car’s resale value as parts and metal.
Insurance companies set the total loss value which you are to be paid by determining the value of your car minus any deductible you may owe. On top of this, if it is determined that you contributed to the accident in some way, the adjuster may deduct a percentage of contributory negligence.
Once all calculations are made, the insurance company will write you a check, unless you had been leasing the car in which case the check would be sent to the lender.
One thing yo0u should know, however, is that you are within your rights to negotiate the payout offered for your totaled car. You may be able to point out to them that when accessing the average price of cars comparable to yours, only lower-end models were considered. You should feel free to inquire with the insurance company how they arrived at the price they are offering and push them to consider the very same model with the same amenities and milage as your totaled car. You may have to show your insurer receipts for any work you had done on your car.
Be careful if you accept any check your insurance company offers for your car. Once you accept it, they are the new legal owners of your car. Your lender will also be involved in this exchange if you have a car loan. Once you have your salvage certificate, you can try to sell to a car dealership since they tend to purchase salvaged vehicles to repair them, auction them off, or sell them for parts. Some dealerships only deal in salvage cars since handling such vehicles can be quite profitable.
If no dealership is interested, try your local junkyard and see how much they will offer to scrap your car. Be sure to shop around, as some junkyards will offer to pick up your car for free or offer you more money per ton. Don’t forget to check your car to make sure you’ve removed all personal items before the junkyard takes possession! You should call the DMV about a week after handing over your title to the junkyard to see it if has been processed.
If you’d rather donate your totaled car to charity, you can rest assured that you will likely receive a tax deduction for your altruistic donation. Organizations which accept cars as donations include Make-A-Wish, Kars4kids, and Vehicles for Veterans. You can typically claim a deduction of up to $500 on your 1040EZ when filing your taxes.
For more information on your options after your car is considered totaled, check out this helpful website.
If you or your insurer has determined that your vehicle is not worth repairing, you will be issued a Salvage Certificate by the DMV to verify your ownership. The first step you need to take after a total loss as it pertains to the DMV is to file a total loss claim with your insurance company.
Your insurer will likely require from you:
For more on how to report your totaled car to the DMV, check out their website.
If you decide to sell your totaled car, and you are knowledgeable when it comes to parts, you should consider selling to a dealership or junkyard, where you can potentially sell it for more than to your insurance company.
If you feel the insurer or adjuster did not valuate your totaled car correctly, or you were assigned a larger share of the fault than you deserve, you need to call the Law Office of Jacob Emrani. With an aggressive Los Angeles car accident attorney on your side, you can be confident your rights will be protected and we can fight for the best outcome possible.
Call (888) 952-2952 to set up your no-cost case evaluation!