You’ve been in a bad car accident. Your car is a mangled mess. Now what? A car is considered totaled when the cost of repairing it exceeds the cost of replacing the vehicle. Understanding what you will get from totaled car insurance is essential to know what will happen in the event that an accident writes off your vehicle. In this post, Long Island Insurance Executive, Gregg S. Marcus, explains how your insurance company calculates the value of a totaled car.
When your car is totaled, your insurance company will give you what’s called “fair market value” for your car. The auto insurance company takes the following four factors into consideration when determining the fair market value:
The type of vehicle that has been totaled and will be covered by the insurance plays a large part in the determination of value. Classic and luxury cars will be treated in a different way than an average car as they depreciate in value differently.
The age of the vehicle covered by totaled car insurance also helps to determine the value that will be reimbursed. It is much easier to determine the value of the vehicle according to the type and age than any other factor.
Condition of Vehicle
If the condition of the vehicle prior to the accident in question was below that of a similar vehicle of the same age, the average sum will be reduced.
If the insurance company feels that the accident causing the total loss may have partially been your fault, they are likely to reduce the total loss value based on this information. The total value of the vehicle will be calculated before a certain percentage is removed based on the actions causing the accident.
If your car has been totaled and is considered totally beyond repair, then your insurance company will advise you to settle for the salvage value of the vehicle. Once you accept the settlement amount, the car is sent to a salvage yard where its parts are auctioned off to the highest bidder. The salvage value that you are paid will be based on the factors above.
If you live in Nassau County or Suffolk County on Long Island in New York and are looking to switch auto insurance companies, contact Gregg S. Marcus today for a quote. He may be able to save you hundreds on your car insurance policy!