A car accident is always frustrating, but when your own car is declared an economic total loss, despair can often set in. But what exactly does “economic total loss” mean, and what options do you have as a vehicle owner in this situation?
Car with severe damage, indicating economic total loss
What Does “Economic Total Loss” Mean?
Unlike a technical total loss, where the car is no longer drivable, an economic total loss occurs when the repair costs would exceed the vehicle’s replacement value. Simply put: It’s cheaper to buy a comparable car than to have your own repaired.
But how is the replacement value determined? Several factors play a role here, such as the vehicle model, age, mileage, and overall condition before the accident. To determine your vehicle’s value, you can use online appraisal portals or hire an independent automotive appraiser.
Your Options After an Economic Total Loss
Basically, you have three options after an economic total loss:
- Repair at Your Own Expense: You can have your car repaired at your own expense despite the economic total loss. This can make sense if you have an emotional attachment to your vehicle or if it’s a rare model.
- Sell to a Dealer or Buyer: Numerous dealers and buyers specialize in purchasing salvage vehicles. They usually offer you a residual value for your vehicle, which is typically below the replacement value.
- Settle with Your Insurance Company: If you have full coverage insurance, the insurance company typically covers the damage. Depending on your policy, you will be reimbursed either the replacement value or the residual value of your vehicle. In the case of comprehensive insurance, coverage usually applies to events other than collisions with another vehicle, such as accidents involving wildlife.
Checklist for selling a damaged or salvaged car
Tips for Dealing with Your Insurance Company
- Report the damage to your insurance company immediately.
- Hire an independent automotive appraiser to assess the damage and determine your vehicle’s replacement value.
- Don’t let yourself be pressured, neither by the insurance company nor by dealers or buyers.
- Find out exactly about your rights and obligations as a vehicle owner.
An economic total loss is frustrating, but it’s not a reason to despair. With the right approach and good preparation, you can navigate the situation. If you have further questions or need assistance with processing the claim, we are happy to help.
More Helpful Information
- Golf 7 Accident: Information and tips for dealing with an accident involving a Golf 7.
- Car Total Loss: What You Are Entitled To: Detailed information about your rights and claims in the event of a car total loss.
Auto appraiser examining a damaged vehicle
Related Questions About Car Economic Total Loss
- What to do if the insurance company doesn’t want to cover the damage?
- Can I re-register my car after an economic total loss?
- Where can I find a reputable buyer for my damaged vehicle?
Feel free to contact us if you have further questions about “Car Economic Total Loss”. Our team of experts is ready to assist you.
