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Accidents can cause varying levels of damage to the vehicles involved. When an insurance adjuster evaluates your car after a crash, they may decide that it is a total loss. A total loss is when the insurance company determines that it is not cost-effective to repair the vehicle. Washington state has a total loss law that requires insurance companies to use a specific formula to decide whether or not a car is totaled, and car owners have a right to see those calculations as part of their settlement.
What is the Formula for Calculating Whether a Vehicle is a Total Loss?
To determine whether a car should be totaled or not, the insurance adjuster must first calculate the actual cash value (ACV) of the vehicle. The ACV is not what the car was worth new or what it would cost to replace it. Instead, it is the car’s fair market value immediately before the accident. There are several approved ways insurers can get this valuation. The car owner can request a copy of the total loss valuation report if they have questions or concerns about how it was calculated.
Once the ACV is determined, the adjuster must establish the total repair costs and the vehicle’s salvage value. If the salvage value plus the repair value is GREATER than the ACV then car is totaled. So for example if repairs are $5 and salvage value is $5 but ACV is $100 then no way it would get totaled.
An insurance company will look at the after repair value of the vehicle and compare that to the cost to repair, salvage value, availability of parts, and type of damage in determining whether they total a vehicle.
What Happens After Your Car is Totaled?
Once your car is totaled, the insurance company is required by law to pay you the ACV of the vehicle, minus any applicable deductible. Insurance must also cover the sales tax, title, and licensing fees as part of your settlement. If you disagree with the valuation of your vehicle, you may request a third-party appraisal if your policy allows it.
If you choose to keep your vehicle after it is totaled, you will receive the ACV of your car minus the salvage value and any applicable deductibles. The insurance company will report the vehicle as totaled so to legally drive the vehicle again you’ll have to get the state patrol to inspect the car and make sure it’s safe to drive
How Can a Lawyer Help You With the Claims Process?
Navigating the claims process after an accident can be complex and stressful, especially if you are still recovering from injuries. You may be concerned that your insurance company is not treating you fairly, or you might simply have questions about the process. Whatever your concerns, an experienced car accident attorney can help guide you and ensure that your rights are protected. Contact our office today to learn more: 206-447-1425.
