A totaled vehicle?is one of the biggest heartaches for?all car?owners. ?We receive?a lot of questions from clients who experience a total loss claim and wanted to provide a deeper explanation of how it works.
After filing a claim, your insurance adjuster?will assess the condition of the vehicle and evaluate the value depending on the model, make, and year. An?accurate estimate will then be determined for?the totaled car?s actual cash value (or ACV). At the same time, the insurance company?considers the resale value of the remaining parts as well as the metal that can still be used from the wrecked car. It’s what they call the “salvage value.” A final thing that is considered?is estimated?cost of repair for the unseen damages that may not be visible.
When the?salvage value and the cost of repair is higher than the?assessed ACV of the vehicle the insurance company would declare it as a total loss.?
So it?s a total loss, what now?
There are two options if your car is declared to be a total loss. First, you can agree to a cash settlement for your vehicle?s ACV. On the other hand, you can ask to obtain the damaged vehicle and the title back to you. The insurance company, however, would report your car?s VIN so that future buyers will be aware of the damages that occurred to your vehicle during the accident.
More often than not, customers opt for the cash settlement. If the car was completely paid off, the whole amount goes to the insurance holder. However, the lien holders such as credit unions or banks will get the full amount if the vehicle is not yet owned outright in the time of the accident. The amount that they will give, either to the customer or lien holder, will be given after all the deductibles are computed.
The right coverage will?protect you
Getting sufficient coverage such as comprehensive and collision coverage can protect you?if your?car is?considered a total loss. Comprehensive coverage can give you protection in case of damage?due to severe weather and other events regarded as Acts of God. The collision coverage kicks in if?you get into an accident with another vehicle.
Still not sure?about your car insurance options? Let Velox Insurance guide you in choosing the right coverage for your vehicle. Click here to locate an agency near you?or give us a call at 1-855-Go-Velox?today!