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A “totaled” car is sometimes also referred to as a “total loss” by insurance companies. It means the cost to repair the vehicle is higher than its actual value or that the car is not repairable. This matters after a car accident because it can require more work when making your insurance claim.
If you are injured in a car accident that wasn’t your fault, you will need to file a personal injury claim with the at-fault driver’s insurance company. You will also need to understand what it means for your claim if you total your car.
How Do I Know if My Car Was “Totaled”?
When a car accident damages your car so much that repairing it will cost more than the value of the car, the car is totaled. When the insurance company deems the vehicle a “total loss,” it should pay you for the replacement value of the car.
A car does not need to appear completely obliterated to be totaled. Sometimes, the damage is not even clear from the outside. To know for sure, an insurance claims adjuster will need to inspect your car and assess the damage themselves. This happens after you file your insurance claim. If your car is a total loss, you will find out after the assessment.
What Happens if My Car is a Total Loss?
According to Georgia Rule 120-2-52-.06 Total Loss Vehicle Claims, if the insurance company determines your car is a total loss, they can either:
- Replace the car
- Pay you in cash for the car’s value
Here is a breakdown of each method.
1. Replacement Vehicle Method
Under this method, the insurer can replace your totaled car. They must also consider licensing fees, taxes, and other costs associated with ownership. The replacement car must also be:
- In good condition and comparable to the totaled car in the model, year (same or newer), mileage, and body style
- Available for inspection by you within 50 miles of where you live unless you agree to a further distance
- Purchased from a licensed dealer or “established printed sales publication”
The insurance claim will include a full description of the replacement vehicle you are receiving. If, for some reason, a vehicle meeting the above requirements is not available, the insurer will use the cash method below instead.
2. Cash Equivalent Method
Instead of replacing the vehicle, the insurance company might choose to pay a cash equivalent of the actual car’s cost. This cost is calculated based on the condition of your car before the accident.
The payment should be enough to purchase a comparable car of the same make, model, body style, and other details, including all fees associated with ownership. The insurer will determine the cash equivalent value based on the costs of two or more comparable cars in the local area.
Also, if within 30 days you find a replacement car that is higher in cost than the cash settlement you received, the insurance company should make up for the discrepancy. They would either pay you the difference or find a lower-priced car.
Will My Insurance Company Pay for a New Car?
If you have collision coverage through your auto insurance, you may have the option to turn to your own insurer (collision coverage is not mandatory for auto insurance under Georgia law, but it is often required by the lender if you lease your vehicle).
However, it’s generally best to turn to the at-fault driver’s insurance company first. If their insurer then offers you a low settlement and won’t negotiate, you can consider your own policy.
If you are having trouble with either the other driver’s insurance company or your own, call a car accident lawyer. They can advise you on the steps to take to reach a fair settlement.
What if I Want to Keep My Totaled Car?
It is in your right to choose to keep your car after it’s been totaled. However, keeping the car may impact what the insurer pays you. In most cases, it’s in your best interest to part with the car and pursue compensation for replacing it.
Need Help with a Claim After Totaling Your Car?
Unfortunately, insurance companies do not have your best interest in mind. Even if they are quick to pay for the costs of a new car, you can’t be sure it’s based on a fair assessment. Insurers will look for ways to cut costs and pay less. To make sure they are held accountable, you will need a trusted car accident lawyer.
John Foy & Associates can help. Our goal is simple: we want to get you the money you need to cover the costs of an accident you didn’t cause. That includes replacing your car if it was totaled. To discuss your case today for FREE, call us at (404) 400-4000 or contact us online.
