What auto insurance issues are there when a car is totaled?

After a car accident, some drivers are told their cars are considered a total loss. If your car is totaled by the insurance company then the main issues that will occur is calculating the value that your insurer must pay out.

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Because you have auto insurance, you won?t suffer a 100% financial loss because your car was damaged in an accident. If you have an emotional attachment to your car, and you?d like to see the car repaired after a serious accident, understanding how to mediate the insurance process can help you negotiate with the auto insurance company.

What does an insurance adjuster mean when he says your car is ?totaled??

Although images of badly damaged cars from movie chase scenes may fill your mind, your totaled car may look reparable. That?s why it?s important to understand the insurance company?s meaning of total loss.

Total loss is a mathematical calculation performed by the insurance company. Many auto insurance companies consider the car a total loss if the costs to repair it exceed 70% of its market value.

Your state auto insurance laws also affect how much damage constitutes a total loss. The auto insurance company has access to software services that provide an average replacement cost of your car. The Blue Book, and others, help the insurance company understand at what price a vehicle similar to yours is sold in dealer networks.

If the costs required to repair your car are higher than the car?s present value, the auto insurance company decides to total the car. Although your car may be drivable, and you want to repair it, the insurance company can refuse. If your car has suffered extreme damage, totaling the car allows you to shop for a replacement vehicle with funds in hand. Once the insurance company totals the car, you receive a check for the car?s value.

What is the process involved in totaling a car?

Your insurance company sends an insurance adjuster to the location of your car. The insurance adjuster evaluates the damage done to your car, and assesses the vehicle?s present market value. The insurance adjuster may consult with a reputable mechanic for a second opinion about whether the car should be considered a total loss.

Suppose your car has a present market value of about $18,000. The adjuster determines that repairs will cost about $10,000. The car isn?t a total loss, because the insurance company can decide to pay for repairs of less than the current market value. If the repairs cost $16,500, though, the adjuster totals the car.

What is the process involved in repairing a totaled car?

If you?d like to repair the car, or you think the replacement value provided by the insurance company is too low, research your car?s current market value. Ask your own mechanic about your car?s damages. It?s important to support your desire to repair the car, or get more money for a replacement vehicle, with facts. Your insurance company?s auto insurance policy allows you to disagree with the insurance adjuster?s findings. You may ask for a second, or third, opinion of the damages.

Although asking for additional help to settle the auto insurance claim will take more time, the return of a repaired car or more money to buy a new one is an important consideration. An automobile is an expensive asset, and the insurance company?s assessment of its value may be lower than its true market value.

Performing these steps can help earn you the right to repair your car. Its total miles and age are important factors. Unless you own a classic car, an older vehicle is more likely to be totaled than a newer car with low miles.

When the decision is reached to allow you to repair the car, the auto insurer sends a check for the assessed value less the estimated amount the company would receive to junk the vehicle. The insurance company then decreases the check amount by your deductible. Then it?s up to you to repair the car with funds in hand.

Why is auto insurance so important to the driver of a totaled car?

Replacing a totaled car with cash on hand is an expensive proposition for most people. Auto insurance protects one of your most valuable assets as it protects your financial rights to take the wheel. Auto insurance is a must-have for every driver on the road in 49 of the 50 states. And even in ?Live Free or Die? New Hampshire having coverage is wise.

Get the auto insurance you need without spending too much. Compare your current rates and coverage by requesting free auto insurance quotes today!

Source: http://www.autoinsurance.org/what-auto-insurance-issues-are-there-when-a-car-is-totaled/

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