Do You Have To Accept A "Total Loss" Settlement On Your Car?

Car accidents do not always end with both cars being repaired at a local auto body shop. In severe car accidents, one or both of the vehicles could be considered totaled by the insurance company. If your car was declared a total loss by an insurance company, here is what you need to know.  

Why Is Your Car Considered Totaled?

After a car accident, the insurance company will rely on an adjuster to review the damages incurred and make a determination what it will take to make the innocent party whole again. In this instance, the adjuster will evaluate your car and determine what it will take to repair it.  

In some instances, the adjuster determines that the value of the car is not enough to warrant repairing. He or she will look at the cost of repairs and compare it to your car's value. If your car's value is below or slightly above the cost of repairs, the adjuster could total your car. 

For instance, if the cost of repairs for your vehicle are $5,000, but the fair market value for your car on the day the accident occurred was $3,000, it is likely that your car will be considered totaled.  

If your car is totaled, the insurance company will pay what it feels is the fair market value of your car. If your car had a lien on it, such as from a financing company, the check will go to the lienholder first to pay off the balance of the lien. Any remaining funds will go to you.  

What If You Do Not Agree?

If you do not agree with the insurance company's decision to total your car, there are a couple of options available to you. One of those is to attempt to negotiate with the insurance company to change its estimation of your car's worth and pay for the damages. There is no guarantee that the insurance company will be willing to do this.  

Your motor vehicle accident attorney can provide evidence to the insurance company that the car was more valuable than the insurance company claims or that the repairs are less than the adjuster determined.  

Another option is to file a lawsuit against the insurance company. If you do file a lawsuit, you can not only sue for the value of your car, but the other damages that you incurred.  

Depending on your state's laws, other options might be open to you. Discuss your case with your attorney to learn whether or not there are other ways of being fairly compensated. Click here for more information.