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Facing total loss after a Car crash: Understand the options when car Insurance falls short

Updated: Jun 19, 2023

Car Insurance

Dealing with the effects of a car crash may be extremely upsetting and stressful. It can be even more difficult if your car is beyond repair, especially if you have to cope with the cost of repairs or a total loss.

This might be particularly challenging if you assumed that your car insurance would protect you only to discover that it is insufficient to pay for the damage. This blog post will discuss your alternatives if your car is declared a total loss despite having car insurance.

What is total loss?

Total loss, commonly referred to as a "write-off," is a term used when a car suffered enough damage that repairing it would be unsafe or unprofitable. Different factors are taken into consideration by insurance companies to determine whether a car is a total loss, but usually, if the cost of repairs exceeds a predetermined portion of the value of the car, the car is deemed a total loss. The amount is normally between 75% and 80% of the value of the vehicle, though it might differ from state to state and insurer to insurer.

The insurance provider will normally make you an offer when your car is deemed a total loss. This sum is determined by subtracting any applicable deductibles and salvage value from the car's pre-accident value.

The estimated value of the wrecked car and its components is what is known as the salvage value. Typically, the insurance company will sell the damaged car to a salvage yard or auction while keeping the salvage value.

What Happens When Your Car Goes into Total Loss Even After Car Insurance?

Even with car insurance, if your automobile is deemed a total loss, it indicates that the repairs would be more expensive than the car is worth and the insurance company is unable to cover the costs. There are a number of causes for this, including:

Insufficient Coverage:

If you merely purchased liability insurance, your coverage will not pay for vehicle repairs. Liability insurance only covers losses you cause to other people and their property; it does not, however, cover losses you sustain to yourself. You must have collision and comprehensive insurance if you want your own losses to be covered.

High Deductibles:

If your deductible is large, you might have to fork over a significant amount of money before your insurance coverage begins to pay. You might not be able to afford the repairs even with insurance if the cost is near to or more than your deductible.


If your insurance coverage is insufficient, the insurance company's settlement offer could not be sufficient to pay for the necessary repairs. This may occur if you did not buy adequate insurance coverage or if your car has lost a lot of value since you bought your insurance policy.

Car value:

The insurance company will consider your automobile a total loss if the cost of repairs exceeds the worth of the car. This means that you won't receive enough money to pay for the necessary repairs. This may occur if your car is older or has a high mileage because as time passes, a car's value declines.

What are your Options When Your Car Goes into Total Loss Even After Car Insurance?

You still have options if your car is deemed a total loss despite having car insurance. Here are a few of the most typical:

Accept the Settlement:

You can accept the settlement and use the money to buy a new car if the settlement amount provided by the insurance company is reasonable and covers the cost of replacing your vehicle.

Negotiate the Settlement:

If you think the insurance company's offer of a settlement is too low, you can haggle with the adjuster. You can offer proof of the value of your car, such as the most current service records or the receipts for improvements or repairs.

To support your case for a larger settlement, you can also offer prices from dealerships or private sellers for similar reasons .

Make a Claim with the Other driver's Insurance:

If another motorist was at fault for the collision, that driver's insurance provider may be liable for covering the cost of your car's damages. You can approach their insurance provider and discuss a settlement with them.

Consider Legal Action:

You may want to think about pursuing legal action if you feel that the insurance provider or the insurance provider for the at-fault driver is not providing a reasonable settlement amount. To obtain compensation for your damages, you can employ legal counsel, sue the at-fault driver's insurance provider, or both.

Explore Salvage Options:

If your car has salvage value, you may be able to sell the damaged car at an auction or salvage yard. This may enable you to recover part of the accident-related expenses.


After an accident, dealing with the total loss of your car can be a stressful and upsetting process, especially if you believed your auto insurance coverage would fully protect you.

To make the finest choice for your circumstances, you still have options, therefore it's critical to comprehend them. It's important to take your time and make a well-informed choice, whether you want to accept the settlement amount provided by the insurance company, bargain for a larger amount, file a claim with the other driver's insurance, or investigate salvage possibilities.

If you're confused about what to do, you can always see a reputable lawyer or financial expert who can help you navigate the process.



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