Whether a vehicle involved in a collision is considered “totaled” for insurance purposes is an issue of great torment and confusion for our clients. We hear horror stories about older, pristine, well-functioning automobiles being totaled out simply because the frame is bent or other seemingly minor and hidden damage occurs. In most cases the insurance company of the at-fault driver will pay for repairs for property damage to your vehicle. However, the level of damage to a vehicle relative to its Actual Cash Value (ACV) can affect whether an insurer is required to repair a vehicle or whether it will be considered a total loss. This is called the Total Loss Threshold, and in South Carolina if the repair costs are greater than 75% the insurer can total out the vehicle.
This can be good or bad depending on your car loan status. For instance, if you just purchased a new vehicle, the ACV will likely be less than your payoff. While it does not seem fair, the insurance company is not required to pay off your loan – they are only required to pay ACV. So if you are upside down on your vehicle loan you will be responsible for making up the difference in the ACV and the loan payoff. Therefore, it may be in your best interest to try to repair your vehicle, so I would push to get the vehicle repaired by the insurer if it is close to the Total Loss Threshold. If you are not upside down on your loan, you may want the vehicle totaled out so you can purchase a vehicle that has not been involved in a collision.
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If it is a third-party claim where you are filing under the at-fault driver’s insurance, and the vehicle is being repaired, be sure to ask for the “diminished value” of the car. This is the difference in the value before the accident (no prior wrecks) vs. the post-collision value (after the wreck). The reality is that your vehicle after a wreck is less after it has been in a collision reported to Carfax. The insurer will try to minimize this value, but you should be entitled to up to 20% of the value of the car before the collision, depending on the severity of the damage. This may end up being your saving grace on the property damage claim. If you have questions on this please feel free to call us to discuss.
If you have been in an auto accident it is important to be in touch with the at-fault driver’s insurance company to be sure to receive compensation for your vehicle. The insurance company should offer you fair market value for your vehicle, but that isn’t always the case. It depends on the at-fault driver’s insurance, the condition of your vehicle, and the amount of available coverage. If the at-fault driver does not have insurance, or if their insurance policy is not enough to cover the property and personal damages, then your Underinsured or Uninsured (UM/UIM) coverage may come into play to fully compensate you for your damages.
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It is important not to discuss your injury and the status of your personal injury case with the insurance company. It is fine to discuss the property damage and basic facts of the accident, but do not agree to a recorded statement. Instead say that you will allow an interview but nothing recorded. They can and will use anything you say regarding the case against you, if it applies. Be sure to discuss the details with your Greenville, South Carolina car accident injury attorney if you have any questions. Call for your free consultation today at 864-326-3333.
If you have been in an accident contact the attorneys at Hammack Law Firm today. Our attorneys have decades of experience with these kinds of cases. Call us today at 864-326-3333 for your free legal consultation!
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