You’ve been in an accident and the insurance company says your car is a total loss.
· What is a total loss?
· Which insurance company will pay for the damages?
· What if you don’t agree with the evaluation of the insurance company?
Let’s take a look at each question.
What Does Total Loss Mean?
A car is considered a total loss when the costs of repairs are higher than the actual cash value of the car. For example, if a car with a value $4,000 needs repairs in the amount of $5,000 the car will be classified as a total loss. The insurance company may still consider it a total loss if the repairs will cost 75% of the total cash value, even if that 75% is less than the total cash value.
Which Insurance Company Will Pay for the Damages to My Car?
This depends of a couple of things. One, was the accident in a no-fault state or in a non-no-fault state? Second, what type of coverage is being used to pay for the totaled car?
No-fault insurance means that the insurance company will pay for certain damages no matter who was at fault. However, in some no-fault states, claims on vehicle damage do not fall under no-fault rules. This means you can pursue a claim against the driver that struck you.
In a traditional fault state, liability for a car accident will always be based on NEGLIGENCE. That means that the insurance company will only pay for damages if someone was at fault, unless you have coverage that will pay no matter who is at fault, like collision coverage.
Here’s the bottom line; if your accident happened in a non-no-fault state, the other driver’s insurance will only pay for the damages to your car if that driver is found to be negligent. If you are the one who was negligent, your insurance company will pay only if you have collision coverage on your policy.
How Much Will the Insurance Company Pay?
Insurance companies will only pay claims up to the limits of the policy. So if the other driver caused $20,000 in damages, but they only carry $10,000 of property damage coverage, their company will only pay you $10,000. The only way to get the other $10,000 is from your own collision coverage on your own policy.
If your car is a total loss, you will only be paid the fair market value of your car. The insurance company is only liable for the fair market value of the totaled car, even if you owe more than the car’s value on your auto loan.
What if I Don’t Agree with the Evaluation of the Insurance Company?
If you don’t agree with the damage evaluation your options are to accept it, try to negotiate with the insurance company, or file a claim in court. It doesn’t matter if you want to negotiate or file a claim in court, you will need to have a basis for disagreeing with the evaluation of the insurance company. Hard evidence is required to prove that your car is worth more than what the insurance company says its worth. You will have to have two kinds of evidence: evidence to show exactly what type of shape the car was in prior to the accident and evidence as to the car’s actual fair market value.
The best way to prove the actual condition of the car prior to the accident is with recent photos of the car. If you believe that your car is worth more than its Blue Book value because you made expensive upgrades, you should have detailed photos and receipts showing those upgrades. This way you will always have proof of your car’s condition.
The best way to prove the actual value of your car is by the opinion of a qualified appraiser. If you disagree with the insurance company’s evaluation, you are going to have to hire the appraiser to write an opinion of your car’s worth. Your appraiser may need to go to court with you to testify in support of their written appraisal.
St. Louis Car Accident Attorney
While the process can be confusing, if you are represented by the Lieser Law Firm for your bodily injury claim, we will assist you with your property damage claim at no additional cost.
If you have been in an accident and your car has been totaled, or you have questions regarding what the insurance company is telling you, you need to speak to a qualified attorney as soon as possible.