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The insurance company says my car is totaled – what does that mean?

August 17, 2009

You’ve been in a car accident, and your vehicle was damaged so you make an insurance claim. Now the insurance company has one of two choices: they can either pay for the necessary repairs to your car or they can “total” it.

The phrase “totaled” conjures up images of a car smashed up beyond recognition, a car that is completely beyond repair. However, in insurance lingo “totaled” doesn’t mean what it sounds like. Rather, a car is “totaled” if the cost of repairing the car exceeds the value of the car.

What you will receive for your “totaled” car is its “actual cash value.” Actual cash value is defined as the cost of replacing your car with a car of similar make and quality in Texas, with some deductions made for your current car’s wear and tear.

In some cases, a car accident victim will disagree with the insurance company that their car is totaled. The victim may want to keep their car and pay for the repairs. You do have this right.

The process of reclaiming your totaled car works like this: the insurance company will pay you the actual cash value of your car. However, the insurance company will deduct the amount they would have gotten for your car at a salvage yard. If you want to go this route, it’s important that you inform your insurance company right away before your car is sent off to an auction at a salvage yard.

If you have been involved in a car accident, it is wise to seek the advice of a Texas car accident attorney before accepting any offer from an insurance company. The insurance company’s goal is to pay you as little as possible for the damage to your car. A car accident lawyer can help ensure that you get a fair settlement.

For free legal advice on car accident insurance claims as well as personal injury claims arising from car accidents, contact Fears Nachawati today. Simply email us at or call us on our toll-free hotline at 1.866.705.7584.

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