Georgia actually doesn’t have a formal legal definition of total loss in car accident cases. But, insurance companies use this term on a regular basis to determine whether they will repair or replace a vehicle. When a car is a total loss, most insurance companies will pay you the replacement value of your car.
What happens when a vehicle is a total loss?
Although Georgia law doesn’t define what total loss is, it does spell out what an insurance company can do when a vehicle is considered a total loss. The insurance company can do one of two things:
- Pay the cash equivalent value of the car. The cash equivalent value is the actual cost of the vehicle less any applicable deductibles in your insurance policy. That money is supposed to be used to purchase a car that is from the same manufacturer, has the model year, and has similar options, mileage, and body style. This value should also include taxes, license fees, and any other fees that would be incurred if you purchased another car. Insurance adjusters sometimes overlook these necessary fees that should be part of the payout on your claim.
- Replace the insured vehicle. The insurer can also choose to purchase you a replacement vehicle outright. The new car must be essentially the same as the one that was totaled, including the same make, model, and mileage as close as possible to your previous car.
Most insurance companies will choose to just give you money for the replacement to avoid the time and effort of having to shop for a vehicle for you.
What happens to my car if it is a total loss? Can I keep it?
In most situations, the insurance company will take steps to destroy, junk, or resell your car if they determine it is a total loss. But, if you want to keep the car, even after it is considered a total loss, you might be able to do that. Ideally, you will be able to convince the insurance company that you should receive a check without salvaging the car, but depending on the insurance company, that’s not always possible.
If you end up with a salvage title, you will need to get the car repaired and then submit it for review to the State of Georgia to ensure that it’s safe to drive. This process can be a headache, but it is doable.
It certainly doesn’t hurt to ask the insurance company about your options, even if your car is a total loss, and John Foy & Associates can help with that process if you’d like to keep your car after a crash.
Has your vehicle been totaled? Do you think you got fair compensation for your car? If not, John Foy & Associates can help. Fill out the form to your right or call us at 404-400-4000 to get your FREE consultation today.