When you get into an accident, there is always a risk that your vehicle will be totaled. It is important as a responsible driver to understand what it means when a vehicle is considered totaled and how the insurance process works for a totaled vehicle.

How a Totaled Car is Determined

Sometimes, you can look at a car after a major accident and easily see there is no way anyone is going to be able to put that car back together again. However, identifying a totaled car is not always that easy. Sometimes, you can drive away from an accident in a totaled car.

Technically, a car is considered totaled when the cost to fix the car is greater than the current market value of that specific vehicle. However, that is not the only criteria an insurance company may use to determine if a car is totaled. If the insurance company doesn't believe the car be safely repaired, they will consider a car totaled. In some states, if the cost to fix the car is more than fifty percent of the car's value before the accident, then it will be considered totaled.

Many insurance companies will first figure out the cost to fix the car, plus the vehicle's scrap value, and consider a car totaled if it cost more to repair than it is was worth pre-accident. The exact total loss threshold and the formula are determined by state law in many states and can vary around the united states.

What You Need to Do After the Accident

It is not up to you to determine the car is totaled. After the accident, you will want to call your insurance company and start the claim process. If your vehicle cannot be driven and you have roadside assistance, you will want to have a tow truck sent to the accident site.

From there, the normal claim process will begin. A claims agent will come and document the damage to determine if the car is totaled or not.

What You Need to Do After the Car is Declared a Total Loss

If the car is declared a total loss, you will want to remove all your personal items from the vehicle. If you have a loan on your vehicle, you will want to get the paperwork together for the loan.

You will need the lender's name, contact information, and account number. The insurance company will pay off the car loan, and if the value of the car exceeds your car loan, they will send that money to you.

You will have to sign a power of attorney, giving ownership of the car to the insurance company. The insurance company will then deal with scrapping the vehicle. You will also need to provide the keys to the vehicle to the claims adjuster or mail them in.

Sometimes it is obvious when your vehicle is totaled, and other times it takes a little investigative work to figure out if your vehicle is totaled. Once you start the claims process, your insurance company will be by your side throughout the entire process.

An auto insurance agent can help you process your claim if your car has been totaled.