What makes your car a total loss is defined by one thing, the estimate to repair your car exceeds the value of your cars actual cash value. Or at least that’s what they tell you.
Once the estimate reaches a certain threshold usually determined by the Kelly Blue book, the car is presumed a total loss until proven to be worth more then the amount in the blue book. The strange thing is no two insurance companies have the same threshold, even though they all use the same blue book. Insurance company A(AA) will write the estimate up to 100% of the Blue Books Value but Insurance Company F(armers) only goes up to 50%. You see all Insurance companies will auction your totaled car to people who will sell the undamaged parts. However Company A will total a car as a last resort for customer service & recoup what they can in the end, where as Company F will total the car so they don’t have to pay out the body shop or rental company. Unfortunately, when an insurance company declares the car a total loss, they will rarely change their mind because they don’t have to, and they can change their numbers however they need to, to prove it.
some examples of cars being declared a total loss for other reasons;
1. a stolen car even if recovered will be declared a total loss if you have been paid for it, once recovered the insurance company can auction it off & recoup a lot of their money or if its a nice car, you may see a company executive driving it the next week.
2. the insurance appraiser/adjuster has an issue with the body shop, and will add repair operations not needed in order to pad the estimate, so that the shop does not get to repair the car and makes little or no money.
3. The body shop estimator is over-zealous, and writes a really high estimate, then refuses to budge or negotiate a lower estimate, forcing the insurance company to either total the car or overpay.
4. The owner of the car is complaining, causing problems for the estimator & the adjuster before they can even see the car, so instead of dealing with an irate customer through out the repairs, they will agree to total the car for a lesser amount.
Check out Karbutler.com, we can help you decide what your best course of action will be. Maybe you don’t want your car repaired cause you really want a new one. Or, it was your Grandfathers car & it has to be fixed so it can stay in the family. The Insurance companies don’t care, to them its all about the money. Information is the Key, to making the right decision.
chris jones says
November 4, 2010 at 1:20 pmthis is an eye opener for me. in the past year my family and I have went through three cars. two from hitting a deer and one other from being in a rear end accident. the rear ending accident didnt make sense to me as to why they totaled the car for their was no damage to the vehicle besides some damage to the rear bumper which shouldn’t have valued at more than the car. this seems a little sketchy knowing an insurance company can find many ways to spend the least amount of money and then turn around and sell or use my car?