If you’ve been in an accident and your vehicle has been declared a total loss by the insurance company, it means the cost to repair the damage exceeds the actual cash value (ACV) of your vehicle.
| Step | Description |
|---|---|
| 1. File an insurance claim | Contact your insurance company immediately to report the accident and start the claims process. |
| 2. Have your vehicle towed | The insurance company will send an adjuster to inspect the damage at an approved body shop or location. |
| 3. Gather important documents | Locate your vehicle title, registration, loan or lease documents, and receipts for upgrades or modifications. |
| 4. Verify your vehicle’s actual cash value | Check trusted sources like Kelley Blue Book or NADA Guides to ensure the insurance company’s valuation is fair. |
| 5. Discuss settlement options | The insurer will offer you the ACV minus your deductible. If you have a loan or lease, they will pay the lender first. |
| 6. Consider keeping your vehicle | In some cases, you may keep your vehicle by accepting a lower payout and repairing it on your own, but it will have a salvage title. |
| 7. Use your settlement to pay off your loan | If you owe more than the ACV settlement, you’ll be responsible for the remaining balance on your loan or lease. Gap insurance can help. |
| 8. Shop for a replacement vehicle | Once you have your settlement check, start looking for a new vehicle, factoring in taxes, registration fees, and insurance costs. |
Table of Contents
What Is a Total Loss Car?
A total loss car is a car that has been damaged to the point where the cost to repair it exceeds its actual cash value (ACV). When this happens, the insurance company will declare the car a total loss and pay out the ACV of the vehicle to the owner, rather than paying for repairs.
The specific criteria for determining a total loss varies by state and insurance company, but it typically involves comparing the repair costs to a percentage of the car’s pre-accident value.
8 Steps To Take After a Total Loss Accident
1. File an insurance claim immediately
Contact your insurance company as soon as possible to report the accident and start the claims process. If the other driver was at fault, you’ll need to file a claim with their insurance company.
Related Article: How To Describe A Car Accident For Insurance
2. Have your vehicle towed to an approved body shop or location
The insurance company will send an adjuster to inspect the damage and officially declare it a total loss if the repair costs are close to or exceed the vehicle’s value.
3. Gather important documents
Locate your vehicle title, registration, loan or lease documents, and any receipts for upgrades or modifications you made to the vehicle that could increase its value. The insurance company will need these.
Related Article: Do I Need To Notify the DMV if My Car is Totaled
4. Research and verify your vehicle’s actual cash value
Check trusted sources like Kelley Blue Book or NADA Guides for the ACV of your make and model in its pre-accident condition. Make sure the insurance company’s valuation is fair and accurate.
5. Discuss your settlement options
The insurer will typically offer you the ACV minus your deductible amount. If you own the vehicle outright, they will send you a check. If you have a loan or lease, they will pay the lender first and send you any remaining amount.
Related Article: Who Gets the Insurance Check When a Car is Totaled?
6. Consider keeping your vehicle if it’s drivable
In some cases, you may be able to keep your vehicle by accepting a lower payout amount and getting it repaired on your own.
However, it will be issued a salvage title which could make it harder to insure and sell later.
Related Article: How to Sell a Total Loss Car
7. Use your settlement to pay off your loan
If you owe more than the ACV settlement amount, you’ll be responsible for the remaining balance on your loan or lease. Having gap insurance can help cover this difference.
8. Shop for a replacement vehicle
Once you have your settlement check, you can start looking for a new vehicle to purchase. Remember to factor in taxes, registration fees, and any additional insurance costs.
Final Thoughts
The most important thing is to communicate openly with your insurance company, understand your coverage, and don’t settle for less than you deserve for your totaled vehicle.
Working with an experienced attorney who specializes in auto accidents can also help you receive fair compensation if there are any disputes with the insurer over the value of your vehicle or the settlement amount.
