How the Insurance Company Determines If Your Vehicle Is a Total Loss
If you find yourself in a car accident, you probably hope the insurance company will cover the costs to repair your vehicle like new again. However, things don’t always go as planned. However, when a serious accident occurs, the insurance company may deem your car a “total loss”. So what does a “total loss” really means? It refers to a situation where the cost to repair your car is greater than its actual value. In fact, some states have regulations that require insurers to declare a car totaled once the damage reaches a specific percentage of its value.
How the Insurance Company Determines Your Car’s Value
Typically, your insurance company will figure out the Actual Cash Value (ACV) by looking at your car’s condition before the accident and comparing it to similar used cars in your area. Just remember, this is not the same as the book value, which might not accurately reflect the current market prices. To really grasp how this works, it’s wise to talk to your insurance agent. Ensure they’re making fair comparisons – looking at cars of the same make, with similar features and mileage – to get the best possible value for your vehicle.
Did you recently invest a lot of money into your car for repairs or upgrades? If you’ve done something major like changing the transmission or getting a new paint job, let your claims adjuster know and keep those receipts ready. They might appreciate the value of your improvements, but if you think their assessment isn’t fair, don’t hesitate to voice your concerns! Explain why you believe the value should be higher. If you still can’t come to an agreement and your policy has an appraisal clause, think about using it.
How you get paid
When your auto insurance concludes that your car is totaled, it won’t be repaired and returned back to you. Instead, you receive a payout of the actual cash value (ACV) minus any applicable deductible, while your insurer acquires ownership of the damaged vehicle. Many call this process a “forced sale,” as your insurance company essentially buys your wrecked car instead of fixing it.
To initiate this procedure, gather these essential documents:
1. Vehicle bill of sale (or sales receipt)
2. Odometer statement
3. Certificate of title
4. Power of attorney
The bill of sale and odometer statement helps determine the payout for your claim, while you’ll need the certificate of title to transfer ownership of the vehicle to your insurer.
Though optional, appointing a power of attorney allows your insurance provider to handle the title transfer independently, so you need not fret about playing mediator between the Texas Department of Motor Vehicles (DMV) and your carrier during any bureaucratic bumps along the way.
You Might Consider Getting Gap Insurance
Once your car’s worth is assessed, you’ll receive your settlement either by check or through direct deposit into your bank account. Pretty simple, right? However, if you still have some debt on your car, things can get a little more complicated.
A check might be issued with both your name and your lender’s name on it, which means you may need to authorize your insurance company to pay the lender directly. If the insurance payout doesn’t cover all your debt, you’ll have to come up with the extra money yourself. Unless… you have this fantastic thing called Guaranteed Asset Protection (GAP) coverage!
With GAP, you don’t need to worry about the difference between what you owe and what the insurance pays out. Just keep in mind that GAP may come with some additional costs when you take out the loan, and you’ll still be responsible for any deductible.
If you’ve been involved in a car, truck, or motorcycle accident, contact the Law Office of Brian Brunson today.
Named one of the “Best Car Accident Lawyers in Dallas” by Expertise.com, Brian Brunson is Texas personal injury lawyer who is dedicated to helping clients who have suffered a car, truck, or motorcycle injury through the negligent or wrongful conduct of other drivers. In addition, his professionalism is unmatched and his 5-star, A+ rating by the Better Business Bureau and client reviews speak for themselves.
We proudly serve the Dallas-Fort Worth metroplex and surrounding areas, our office supports the legal needs of a wide variety of clients. Let the Law Office of Brian Brunson be your advocate in your time of need and help you put your life back together. If we can’t win or settle your case, you don’t pay a dime! We know it can be daunting to take that first step after you’ve been hurt. Contact Brian Brunson today via email or call us toll-free at 1-844-41-WRECK. We can help, when no one else will.
