What Does It Mean When My Car Is Totaled?

“Totaled” is a very common car insurance term used by insurance companies when a vehicle is damaged beyond a cost they are willing to pay for all of the repairs. When your vehicle is involved in a car insurance accident, you will need to get an estimate of repairs from an auto body shop. All Minnesota Insurance Companies have a different formula that they use to determine a total loss. If this estimate is more expensive than insurance company believes the value of the vehicle is, than they will deem your vehicle a total loss. Thus, determining that your vehicle is “totaled.”

Again every Minnesota Insurance Company seems to have a threshold for what they are willing to pay for a vehicle and their own formula. It is often in the range from 70% to 75% of the value of the vehicle. If the cost of repairs surpasses this threshold, the insurance company will deem the vehicle a total loss and pay you the Actual Cash Value of the vehicle.

How Does the Insurance Company Determine the Value of My Vehicle

Great Question. Every Minnesota Insurance Company seems to have a different formula to determine the Actual Cash Value of a vehicle. Actual Cash Value can be defined as Replacement Cost of a vehicle minus depreciation of a vehicle. Some companies will use more of a market value type formula, where the may find 10 very similar vehicles for sale and average those listings out to come up with a fair replacement settlement of your vehicle.

Either way, I strongly suggest to do your own research to find out what the actual value of your vehicle may be should your car be a “total loss”. Most of the time insurance customers feel they receive a fair settlement, but in the case that you do not, you will want to have some supporting evidence if you are going to ask for a higher payout.

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