Aftermath of an Auto Accident: Repair vs. Total Loss

Have you ever been faced with the question of whether your vehicle will be repairable after an auto accident? Understanding how this process works, both from the consumer side as well as the insurance carrier’s side will help you resolve the situation, hopefully creating less stress for you in the process.

In the immediate aftermath of an auto accident, what are the necessary steps to get you back on the road? The first step is obvious. Report the accident to your insurance carrier. After the initial fact-gathering stage is complete, your insurance company will usually send a company adjuster (appraiser) or an independent adjuster out to inspect the vehicle. Depending on the severity of the damage, you may be asked to simply submit an estimate or two for the necessary vehicle repairs. 

This decision of Totaled v. Repairable will be made based on a number of factors:

  • How old is your vehicle?
  • How many miles are on your vehicle?
  • What is the pre-accident condition of your vehicle?
  • How severe is the damage?

These questions will help the adjuster determine whether your vehicle may be deemed a total loss. What is a total loss? It’s simply when the repairs to your vehicle will exceed the current value of the vehicle (actual cash value or ACV).

The decision not to repair your vehicle can be more complex and the consumer has a voice in this process as well. Each state has different laws governing how this process is handled. For the purposes of simplicity, I will use general guidelines used by insurance carriers. Keep in mind, your state laws may differ.

So, the claims adjuster will use the answers to the questions noted above to determine whether an inspection is needed. It is important the adjuster is made aware of any improvements to the vehicle which could increase the value – like a new transmission, leather seating, sunroof, etc. Many consumers see these as typical upgrades, but they can greatly affect the value of the vehicle. Be sure to note any trim package on your vehicle along with the correct engine size. Again, these are important factors in pinning down the actual cash value.

After the inspection is complete, the adjuster will review the estimate and photos of your vehicle, along with a report estimating the actual cash value of your vehicle, i.e. NADA, Kelley Blue Book. This information will determine whether your vehicle can be repaired. If unrepairable, the adjuster will call you to discuss the value of your vehicle along with the next steps in the process. Don’t hesitate to ask to review the estimate and appraisal completed on your vehicle.

Keep in mind, a vehicle repair or total loss is always subject to one’s collision/comprehensive deductible and any lienholder has first right of payment in the event of a total loss.

Resolving a physical damage claim on your vehicle can be stressful. Remember to be thorough and ask questions.

Author

As a mutual insurance company, we operate and exist for the benefit of our policyholders. For more than 100 years, Society has been helping businesses overcome the unexpected with comprehensive coverage packages and outstanding claims handling, underwriting and risk management.

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