If you were in a car accident, there is a chance that your car has taken a bad beating. You may wonder if the damages are repairable or if your vehicle is considered to be totaled. A car is considered totaled when the total cost of damages exceeds the value of the car. Your insurance company will determine if your vehicle is totaled based on repair costs. Cost of replacement parts, salvage value, and labor are all considered when establishing the repair costs. It may be frustrating when trying to decide the next steps after your car is totaled. Follow these steps so that you can be back on the road in no time.
How Car Value is Calculated
Insurers consider multiple characteristics when determining the value of your car. Actual cash value is determined by the condition of your vehicle and generates an estimate of its worth based on the make, model, year, mileage, and resale value. They also look at the selling price of comparable vehicles in your area. In addition, insurers also calculate the salvage value of the parts of your car versus the repair cost to fix it.
My Car is Totaled, What’s Next?
It is essential to connect with a financing or leasing company and let them know that your insurance company will be contacting them. A claims adjuster will seize your keys and have you collect all of your personal belongings from the vehicle. Your insurance company will reward you with a cash settlement which will reflect the actual cash value of your car. If the car was leased, the money would go directly to the leasing company. On the other hand, if your vehicle was financed, the bank would receive payment from what you owe and then you will receive the remainder of the settlement. If you own your car outright, the full settlement amount goes directly to you.