What does it mean when your vehicle is deemed a total loss?
When your insurance company deems your vehicle a total loss that means that the damages are beyond repair or that it is “totaled.” Basically, the repairs would cost more than the actual value of the vehicle. Additionally, the insurance company may be required by specific provincial laws to classify it as a total loss if the car wouldn’t be safe to operate even if it was fixed.
Vehicle Write Off Calculation
Here is a simple calculation to help you determine if your vehicle falls into a total loss category:
Repair Costs + Salvage Value > Actual Cash Value = WRITE OFF
Repair Costs + Salvage Value < Actual Cash Value = REPAIR
Example:
Your vehicle Actual Cash Value =$8,000.
Repair Cost =$13,000
$8,000-$13,000 =-$5,000
In this situation the value of this vehicle is less than the repair cost. Therefore, your insurance provider will deem your vehicle a total loss.
Keep in mind, if the repair costs are close to the current market value (about 80% or higher) your insurer may still consider it a write-off, even if it’s less than the market value. Insurance companies generally factor in other costs associated with the claim such as rental cars, claims services, etc.
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If you’ve recently been in an accident and have retained your “total loss” vehicle, give us a call toll-free at 1(800) 261-9854 or fill out our online offer form. CashForCars.ca buys vehicles in all conditions, and you can rest assured that we’ll give you a competitive price for your vehicle.
