When you are in an auto accident, dealing with the insurance company can be challenging. The insurance company will send an adjuster to evaluate the damage to your car. In some cases, the adjuster will decide to declare your car totaled and pay to replace it. Adjusters use their own criteria and some state laws to determine when to total a car.
Repairs versus Value
When you are in an auto accident, the adjuster will look at the amount of money it will take to repair the car in relation to its value. If the value of the car is low and the amount of money it will take to repair the car back to its original condition is high, the adjuster may total the car. Whether your car is totaled will greatly depend on how old it is and how much it is worth at the time of the wreck.
Percentage of Repair Cost to Value
In this situation, the adjuster will look at how much the repairs cost as a percentage to the total value of the car. If the cost of the repairs exceeds a certain percentage, the adjuster will total the car. Some insurance companies use a percentage of 51 percent to gauge whether a car is totaled. Other insurance companies use a higher figure of around 80 percent. Once the repairs get to that point, the adjuster totals the car.
State Law Impact
Depending on what state you reside in, state laws might have an effect on the insurance adjuster's decision. Some states have rules as to when a car should be totaled by the insurance company. In other states, no such rules exist. Some state laws only say that a total loss occurs when the cost of the repairs exceeds the value of the car itself. When no state laws are present, the insurance company can use its own criteria.
When the adjuster looks at your car, he will be looking at many different factors to determine whether to total your car. You will look at the current value of the car using a database maintained by the insurance company, including car values. He will also look at how much it will cost to pay for a rental car for you while you are without a car. This will factor into the decision of whether to total your car or repair it.