What to Expect From Insurance for a Totaled Car

Most drivers do not consider insurance payments for totaled vehicles until they have major accidents. It is important to know how you will be paid if your car is considered a total loss.

Comprehensive and Collision Coverage

If you carry comprehensive and collision coverage, the insurance company will compensate you for the loss of your car.

Liability Coverage

If you carry only liability coverage, the insurance company will not pay for your totaled vehicle at all.

Actual Cash Value

If you have comprehensive and collision coverage, the insurance company will determine the "actual cash value" of the vehicle, which is the amount it was worth at the time of the accident. Actual cash value is based on how much it reasonably could have been sold for if the accident had not occurred.

Deductible

Your insurance company will subtract any comprehensive or collision deductible on your policy from the actual cash value.

Loans and Leases

Loan and lease balances are not factored into payment unless you purchase guaranteed asset protection. This GAP coverage pays the difference between your loan or lease balance and the value of the vehicle at the time of the accident.

References

• CarInsurance.com: What Happens when My Car is Totaled in an Accident?