How Insurance Companies Determine Total Loss
Car crashes can be life-changing. Not only are you dealing with the loss of your motor vehicle, but you likely have also endured serious bodily injuries. This holds particularly true when “total loss” claims are involved. In spite of obvious losses, navigating an insurance claim often still proves challenging. The following will briefly examine how insurance companies determine total loss.
What a “Total Loss” Claims Constitutes
At its basic level, total loss refers to the point at which an insurance carrier must legally declare a car totaled and apply for a salvage title. The exact criteria that an insurance carrier uses to determine a total loss claim changes between states. In New York, a vehicle with damages totaling more than 75% of its value is considered totaled. In other states like Texas, however, this threshold is 100%.
Notably, some states do not have a specific percentage at which a loss is classified as total. In these states, a total loss formula is used, which is the cost of repairs to the vehicle combined with the vehicle’s scrap value. If this number is equal to or greater than the vehicle’s actual value, it will be classified as a total loss.
What Happens After a Vehicle is “Totaled”
If you are in a car accident and your vehicle is totaled, the first thing that you should worry about is the health and safety of yourself and other passengers. You should assess the extent of the injuries incurred by everyone involved in the accident. It is then a good idea to contact your insurance carrier as soon as possible. In most cases in which a vehicle is believed to be totaled, an insurance carrier will send an adjuster to assess the damage to the vehicle.
The adjuster will decide whether the damage is substantial enough for your vehicle to be classified as a loss. The adjuster will also determine the amount of compensation for which you qualify. In cases where a vehicle is classified as totaled, you will be assigned a salvage title.
Compensation in Total Loss Claims
Besides the total loss value of a vehicle, accident victims are often eligible for additional compensation, which can help manage the numerous associated with recovering from a serious accident. For example, an insurance carrier might be required to pay for the costs associated with the purchase of a new vehicle after a total loss.
Other costs some insurance carriers pay include new vehicle registration, title registration, and sales tax. Given these various costs, it is a wise idea to file your insurance claim as soon as possible after an accident so you can receive compensation more quickly.
If You are Injured in a Car Accident, Speak with an Experienced Accident Attorney Today
The concept of a “total loss” is just one of the many complex insurance principles that arise after a car accident. If your motor vehicle accident resulted in injuries, we can help. Contact Cohen & Jaffe today to schedule a free case evaluation. Free consultations, 24/7.
For a free legal consultation, call 516-358-6900
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