Whether you’re in a really bad car accident or a random act (like a tree falling) damages your car, it can be tough to know whether your vehicle is now a lost cause or if a body shop can bring your car back to life. Many people think that a “totaled” car simply means that the airbag deployed, but that’s not necessarily true. Here’s how to truly tell if your car is totaled or repairable, and how your car insurance handles either situation.
Is my car totaled or repairable?
The technical definition of a totaled car is a vehicle that has a repair cost that is close to or greater than the fair market value of that car. A car’s fair market value is the amount you would be able to sell the car for the day before the accident or damaging incident.
For example, let’s say you were able to sell your car at $8,000 the day before the accident, and the cost of repairs from the accident total $6,000. The fair market value of your car would be $8,000, but because the repair costs are so close to the market value, your vehicle could be considered “totaled.”
Will my auto insurance help cover repairing or replacing my car after it is totaled?
Your auto insurance can only help you repair or replace your vehicle if you have the right coverage. If you’ve opted for only the minimum car insurance requirement for Georgia, you may be out of luck. The state minimum coverage is only built to handle your legal obligation to the other driver if you’re found to be at fault in an accident. It won’t help you cover the damages or injuries that you have.
So, if your car is damaged by an accident, your only hope to have your costs covered would be if the other driver was at fault AND they have the proper insurance to fully cover the repair or fair market value costs of your car.
However, if you have collision and comprehensive coverage, you may not have to depend on the other driver’s insurance – which can be especially good news if you’re dealing with an uninsured driver. The type of coverage that can handle the costs depends on the type of incident, though.
Collison vs. Comprehensive car insurance
If you’re in a car accident that damages or totals your vehicle, collision coverage is the part of your policy that can help you.
Comprehensive coverage is the part of your policy that can help you cover repairs or vehicle replacement if almost anything else happens. Comprehensive coverage can usually help you cover incidents like:
- Natural Disasters
- Hitting an animal
- Falling trees
Whether you’ve been in a car accident or not, though, to have your car repaired, you’ll have to pay your deductible before your insurance pays for the rest. This means that if you have a $500 auto insurance deductible and the cost to repair your car is $6,000, you would have to pay $500 of the repair bill and your insurance would cover the remaining $5,500.
Keep in mind that your insurance company will do their own evaluation of the repair costs and fair market value of your car. So, it’s important to also get second opinions and do your own research on the repair costs and market value of your vehicle.
Can I debate the fair market value of my car?
There are times where an auto insurance company may price a repair at a higher rate or assign a lower market value to your car than it was actually worth. This is because car insurance companies use certain software programs to estimate repair costs and car values.
These programs may not search as widely as you can for the best prices. So, your carrier may price your repairs closer to your car’s fair market value. They may also assign a lower market value to your car so it’s closer to a reasonable repair cost. In either case, the insurance company could end up totaling out your car when it’s not necessary and more expensive for you to get a new car.
For example, let’s say that your insurance company says it will be $6,000 to repair your car after an accident. Then, they say that the fair market value for your car was $7,000. However, Kelley Blue Book or a used car lot actually values your vehicle at $10,000 because they took other factors into account that contribute to the true value of your vehicle.
If you completely relied on the insurance company’s software, they would probably total out your car and may only pay you $7,000. So, you would have to pay an additional $3,000 out of pocket to get a similar car to the one you had.
How to prove the fair market value of your car
Using our example, if you were able to bring your claims adjuster proof that the fair market value for your car was actually $10,000, you may then only have to pay $500 out of pocket for the repair. Then, the insurance company would pay the remaining $5,500. That way, you would only have to spend $500 instead of $3,000 in the long run.
So, if your insurance wants to total out your vehicle, make sure that you’ve done your research by:
- Looking up prices for comparable vehicles in the area
- Checking online resources for the value of your vehicle and for the pricing of your repairs
- Going to a used car lot for a written appraisal of your vehicle
- Getting prices from multiple body shops (They may be able to repair your car for less than the insurance company quoted you for.)
Get quotes for the car insurance you need.
It can be scary and overwhelming when you’re handling the aftermath of an accident. It can be even more challenging if you don’t have the right coverage. That’s why our insurance experts are here to help. We use our expertise to get you quotes on the best car insurance for your specific situation and the risks you may face – for great rates! Don’t miss out on getting cheaper rates for the car insurance you deserve. Fill out our online form, give our experts a call, or click the chat bubble in the bottom right-hand corner to connect with an agent today.