A totaled car is a huge loss that no one ever wants to face. It is one of the main concerns of most car owners that have been involved in accidents. Nevertheless, you should know how auto body shops determine whether a car is totaled or not. Here’s how most auto body shops go about it.
When a Car is Declared Totaled
Auto body shops will consider a car totaled if the cost estimates for repair are higher or less than 70% of the car’s actual cash value. For instance, if a car is worth $10,000 and the estimate for its repair is $7,000, the insurer will likely consider it a total loss even if the repair costs are less than replacement costs.
Even if the repair cost estimates are less than the actual value of the car, it would be unrealistic to fix it if the extent of damage exceeds the 70% threshold. However, auto body shops also consider the age of the car to determine whether it should be totaled.
- 1 – 3 Years-old Cars
The probability of declaring the cars totaled depends on the extent of the damage. The repair costs usually average at about $3,000. Compared to their actual values of about $25,000, only a handful of cars are totalled.
- 3 – 5 Years Old Cars
For such cars, mileage and the extent of the damage play a huge role in determining whether they should be totaled. Cars that sustained damage before the incident have high mileage and extensive wear and tear will have a lower actual cash value. As a result expensive luxury cars, SUVs and trucks are likely to be repaired while the lower priced ones often end up totaled.
- Cars 6 Years and Older
With average actual cash value of less than $6,000 and average repair estimates of $2,000, cars 6 years and older will most likely be totaled.
- Total Loss Threshold
The total loss threshold (TLF) is whereby the car insurance company must legally declare a vehicle a total loss then, seek a salvage title. When using the formula, your insurer will consider the repair costs and the scrap value of the car. They may opt for repairs if the figure is less than the actual cash value of the vehicle. The car will be totaled if the number is similar to or higher than the actual cash value before the damage.
Contrary to what some may think, a totaled car is good news because safety always comes first.