How Much Wreck Damage Has To Be Done to a Car Before it is Totaled?

The damage a car can sustain before being declared "totaled" varies with the value of the car.

After severe damage to a car, it can be declared "totaled," or a "total loss." When a car is considered totaled, it means the cost of repairs, rental car and loss of value exceed the actual cash value of the car minus any scrap value.

Actual Cash Value

The actual cash value of the car is determined by finding the value of the car using value guide books, dealer estimates and comparables. Then add registration, sales tax and other replacement costs.

Repair Costs

State laws and insurance policies differ on how repair costs are estimated. Some insurers rely solely on qualified mechanics. Others have a claims adjustor do a visual inspection to decide if the car is a total loss before deciding to send it to a mechanic. Laws and policies regarding parts, labor prices and other factors can greatly affect the repair estimate.

Appraisal Clause and Litigation

If you have an appraisal clause through your insurance policy and do not agree with the insurance settlement, you have the right to an appraisal process. If you are dealing with another party's insurance company you may have to go through litigation.

References

• ICan: Auto Insurance Claims - General
• Car Insurance: How do insurance companies calculate cost to repair damage? Do they use REAL costs of OEM parts? Take labor into consideration?
• Edmunds: A Total Loss?