When Do Insurance Companies Total A Car?

Have you ever been in a car accident and wondered if your insurance company will consider it a total loss? It’s a common question that many drivers have. When an accident occurs, the damage can vary from minor scratches to severe structural damage.

But when does an insurance company decide to “total” a car? In this blog post, we’ll explore how insurance companies determine whether or not to declare your vehicle as totaled and what steps you can take to avoid it happening to you. So buckle up and let’s dive into the world of total loss vehicles!

How Does the Insurance Company Determine if a Car is Totaled?

When it comes to determining whether a car is totaled or not, insurance companies follow specific guidelines. Typically, if the cost of repairing the vehicle exceeds a certain percentage of its actual cash value (ACV), then they will declare it as a total loss.

The ACV refers to the market value of your car minus any depreciation. So, for example, if your car’s ACV is $10,000 and repairs would cost $7,500 or more (which is usually 70-75% of the ACV), then it may be deemed totaled.

Insurance adjusters will also consider other factors such as age and mileage when assessing the worthiness of repair versus replacement. If your car has high mileage or significant wear and tear that affects its overall safety and performance even after repairs are made, then it may still be declared as a total loss.

It’s important to note that each insurance company has different thresholds for declaring cars totaled. That’s why you should always check with your provider about their specific policies regarding this matter.

What Happens if Your Car is Totaled?

When an insurance company determines that your car is totaled, it means that the cost of repairing the damages exceeds the actual value of your car. This can be a stressful situation for any driver to find themselves in.

Once you receive confirmation from your insurance company that your car is indeed totaled, they will provide you with a settlement offer. This offer will be based on the actual cash value of your car at the time it was damaged. If you have gap insurance, this may cover any remaining balance on a loan or lease.

If you accept the settlement offer, then ownership of your vehicle transfers to the insurance company and they will likely sell it for salvage or scrap parts. You should also make sure to remove all personal items from inside before handing over ownership.

Alternatively, if you choose not to accept their settlement offer and believe that their valuation is too low, then you can negotiate with them directly or hire an independent appraiser to get a second opinion.

Having your car totaled can be frustrating and overwhelming but understanding what happens next can help ease some stress during this difficult time.

How to Avoid Having Your Car Totaled

To avoid having your car totaled, there are a few steps you can take. First and foremost, always drive safely and defensively. This means obeying traffic laws, avoiding distractions while driving, and being aware of other drivers on the road.

Regular maintenance is also key in keeping your car in good condition. Make sure to keep up with oil changes, tire rotations, and any necessary repairs or replacements. This will not only help prevent accidents but also extend the life of your vehicle.

Investing in safety features such as airbags and anti-lock brakes can also reduce the likelihood of serious damage in an accident. Additionally, installing a tracking device or alarm system can deter theft and vandalism that may lead to a total loss claim.

It’s important to have adequate insurance coverage for your vehicle. Consider adding collision coverage to protect against damages caused by accidents or collisions with objects like trees or guardrails.

While these steps cannot completely eliminate the risk of having your car totaled, they can greatly reduce the likelihood and help ensure that you are prepared for any unexpected events on the road.


Having your car totaled can be a stressful and frustrating experience. However, it’s important to understand how insurance companies determine whether or not to total a vehicle. By knowing the factors they consider and taking steps to maintain your car, you may be able to avoid having it totaled.

If your car is unfortunately totaled, don’t panic. Remember that you have options when it comes to dealing with the aftermath of an accident. Work closely with your insurance company and consider seeking legal advice if necessary.

Understanding how insurance companies determine when to total a car can help you make informed decisions about protecting yourself on the road. Stay safe out there!