Keeping a vehicle that your car insurance company has totaled.
If you decide to accept the insurer’s decision to total your car but you still want to keep it, your insurer will pay you the cash value of the vehicle, minus any deductible that is due and the amount your car could have been sold for at a salvage yard.
What happens when you total a car that is being financed?
When your totaled car isn’t paid off. Totaling your car can ruin your year, but it’s especially traumatic when you still owe money on the vehicle. If your vehicle is totaled and you still owe more than it’s worth, your car insurance company will pay only actual cash value (ACV) for your vehicle.
How much damage does it take to total a car?
Definition. A total loss car is generally recognized as a car that would cost more to repair than it is worth. If a car is currently worth $4000, and the cost of repairing the damage is $6000, the car is considered totaled.
How does an insurance company decide to total a car?
If the insurance company totals your car, it will pay you the car’s actual cash value, minus your deductible, and your car is then sent to a salvage yard to be auctioned off to the highest bidder and usually chopped up for parts. The insurance company keeps whatever money it got for the car in salvage.
Photo in the article by “Wikimedia Commons”