The Insurance Definition of Totaled
Some people think that a car has to be completely crushed for insurance companies to consider it "totaled." The truth is that a car is totaled when it has any damage that would cost more to fix than the car is worth. A new car that has minor damage would not be considered totaled, whereas an older car with the same damage might be totaled because of the difference between the two cars' values.
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The Players
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If your car is damaged and might be totaled, there are two people you should know about: the auto body shop owner or mechanic and the insurance company appraiser. The auto shop owner or mechanic is primarily interested in fixing the car, because he will not be paid unless he repairs the car. The appraiser's job is to find the outcome that will save the insurance company the most money. Being aware of the process to determine whether a car is totaled will protect you from being swayed by either of the parties' motivations.
Actual Cash Value
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The determination of the actual cash value of a car is the most important decision that will be made during the process of deciding whether your car is totaled. Every insurance company has different rules to calculate a car's value. To make sure the insurance company is making a fair assessment, you should do some research of your own by comparing your car to other similar cars being sold in your area at the time of the crash.
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Unfair ACVs
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If you think the appraiser made an unfair choice of an ACV for your car, you can hire an independent appraiser. Contact a body shop or mechanic to find an independent appraiser. Make sure her appraisal is a detailed written document. Then present the information to your insurance company. If the insurance company still will not give you what you feel you deserve, you can take the matter to court. Before you take any action, you must decide whether your car is worth the cost of hiring an independent appraiser or attorney.
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References
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- Photo Credit car image by Arman Zhenikeyev from Fotolia.com
