• How is a total loss determined? The actual cash value (ACV) of your vehicle is compared to the cost of the property damage. If the cost to repair is around 75% of the ACV, the vehicle will most likely be totaled. The determination is mathematical.
• What is the actual cash value of my car? The value of your vehicle pre-accident is determined by the Kelley Blue Book.
• The insurance company is not offering me the value of my car! The insurance company’s valuation for your car is usually not the same as your own. Your valuation is usually higher than what the insurance company wants to pay for it. Getting your own written valuation of your vehicle is a more effective method of increasing your compensation. The key with getting your own valuation is that your totaled vehicle needs to be inspected during this process. Usually, your vehicle will be in the possession of the insurance company and you may not have access to it. After a car accident, if you feel that your vehicle will probably be totaled, it may be proactive to get the valuation of the car immediately after the accident and before the insurance company takes possession of your vehicle.
• What if my car is at the tow lot? Tow companies will allow access to your vehicle for retrieving personal items and for inspection by the individual carrying out the valuation.
• The insurance company’s compensation is lower than what I owe on my car. What do I do? Check your automobile policy to see if you have gap insurance. Gap insurance will cover the difference in what you owe and the given compensation so you don’t have to pay out of pocket for a car you no longer have. If you are making payments on your car and your vehicle is totaled in a car accident, you will be compensated for the value of your vehicle before it was in the accident. We all know cars depreciate once you drive off the lot, so you will probably be given less money than what you owe on the car. It may be worth it to invest in gap insurance as a precaution!
Being involved in an accident is unfortunate, inconvenient and particularly stressful. However, if you remember the abovementioned tips, you could potentially save yourself a great deal of frustration and disappointment!