When is a Car Considered Totaled?

Car accidents | April 28, 2021

When is a Car Considered Totaled?

You have certainly heard the term “totaled” when it comes to a vehicle after a collision occurs. To be truthful, many people throw this term around loosely, but it does actually have a specific meaning when it comes to car accident cases. Here, we want to talk about what it means for a car to be totaled. This could have significant implications on your insurance claim in the aftermath of a vehicle accident.

What Does it Mean When a Car is “Totaled?”

When a person says a vehicle is “totaled,” it is important to understand exactly what this means. A vehicle could be a “structural total loss” or a “financial total loss.” When a vehicle is a structural total loss, that means it is no longer safe to be driven. However, there can be some confusion when there is a financial total loss, but the vehicle is still repairable or even drivable.

When picturing a totaled vehicle in your mind, you probably think of something that is destroyed beyond repair. However, vehicles are often considered totaled even when they do not seem to be completely wrecked. The truth is that a vehicle is going to be considered a financial total loss if the damage sustained in an accident comes close to or exceeding the total appraisal value.

When working with this definition, we will find that the description of whether or not a vehicle is totaled will revolve around its actual cash value (ACV).

For example, suppose we have a vehicle with an ACV of $80,000. A vehicle of this value would have to sustain a significant amount of damage before it is considered totaled. However, if we have a vehicle with an ACV of around $8,000, it would not take too much damage in order for the vehicle to be considered totaled.

What You can do if Your Car is Totaled

Insurance carriers are going to do everything they can to limit the amount of money they payout in a settlement. This means that they are notorious for undervaluing vehicles that they consider totaled. In Illinois, you do have the right to dispute an insurance company’s offer if you think that they have not assigned a proper appraisal value to your vehicle. You can almost always count on an insurance carrier offering you much less than your vehicle is actually worth, at least with their initial settlement offer.

If a vehicle is declared a total loss, then the insurance carrier should supply the vehicle owner with an appraisal report. If the vehicle owner disagrees with the appraisal value supplied by the insurance carrier, they will need to retain assistance from an independent auto appraiser who can conduct another appraisal. In these situations, the job of the car owner will be to show that their vehicle is worth more than what the insurance carrier is offering them.

In some insurance policies, we will find an “appraisal clause,” which means that if a person uses an independent appraiser and they receive an increase in their settlement offer, the insurance carrier is required to reimburse them for the cost of hiring the appraiser.

Will You Need a Lawyer to Help?

These cases can become incredibly complicated, particularly when dealing with aggressive insurance carriers. Often, property damage expenses for a vehicle are wrapped into a personal injury claim as a result of the vehicle accident. In these cases, an attorney will handle the injury claim as well as the property value claim as they negotiate with the insurance carrier to receive a fair settlement for their client. An experienced Chicago car accident attorney can use their resources and legal expertise to investigate the incident, properly determine liability, and secure full compensation for their client.