Important Things to Know About Total Losses
What does “total loss” mean?
Usually, when a unit's repair costs exceeds its actual cash value or amount of insurance, it is deemed a total loss. In most, but not all cases, a total loss unit is more expensive to repair than the unit's actual cash value. We also consider whether repairs can be safely completed on your unit.
How is my “actual cash value” calculated?
We consider the year, make and model of your unit, plus other factors such as mileage, options and condition. We compare that to similar units in the market and adjust for differences. The adjustments may go up or down depending on the differences. We follow your state’s laws and guidelines for this pricing process.
What is the next step?
You will need to release your unit and you will need to locate all keys and your title. Your claim representative will contact you, to finalize your settlement and answer any questions you have. They will also provide any paperwork that we, or your state, require to conclude the settlement.
What if I am still making payments?
It is a good idea to contact your financial institution and advise them your unit has been declared a total loss and that your insurance company will be contacting them to obtain information about your loan. Your financial institution has the right of first payment before payment is made to you. You may owe more than its actual cash value. Please be sure to remain current on regularly scheduled loan payments until that balance is cleared.
Can I keep my unit?
Depending on state-specific statutes, you may be able to retain your unit, in a process known as “owner retained salvage.” The value of your unit in its current damaged state is determined (salvage value) and then the salvage value is deducted from your claims settlement. Keep in mind that you may not be able to carry first-party collision or comprehensive coverage, and you may have to report your unit to your Department of Motor Vehicles (DMV) as salvaged. In some cases, certain repair shops will not repair a unit that has been declared a total loss. It is a good idea to consult with your local agent about these coverage issues.
If you have any other questions, contact your Claim Representative.