If you are ever involved in an auto accident in Ohio, and the damages are serious enough, chances are good your car might be totaled as a result.
But what does the word “totaled” actually mean? And what does that mean for your claim settlement? Let's start with working through the typical steps of an auto accident first. *Please note that not all accidents may have these steps occur in this exact order and some accidents may have them all occurring at once. But this gets us going in the right direction. You can also read our article "What Should You Do If You Have an Auto Accident?" for more detailed information.
- Accident happens.
- Police are called to clear the scene and take a report, which includes interviewing the drivers, passengers and any witnesses.
- Police will cite the at-fault party.
- Contact information and insurance information is exchanged between the drivers.
- Each party contacts his or her insurance company/agent for advice as to what to do next.
- If YOU were cited, then chances are good that you'll want your insurance company to pay to fix the other person's vehicle and take care of their injuries, especially if the damages/injuries are severe. Yes, you can elect to pay out of pocket, but that may not be realistic.
- If the other person was cited, then his or her insurance will pay for damages and bodily injury.
Again, keep in mind I'm discussing Ohio here. The process for a no-fault state is probably slightly different. We're not a no-fault state, so I don't speak to that here. If you're curious about no-fault states, you can get a feel for them by reading our article Is Ohio a No-Fault State for Auto Insurance?
6. The adjuster is assigned and will be in charge of collecting all information regarding the accident, including obtaining the police report, taking statements from drivers, passengers and witnesses and making a final determination of fault.
7. Regardless of the carrier, all damaged vehicles will be asked to get an estimate for repair. This could be as simple as visiting a body shop for an estimate, the carrier sending a property damage appraiser to your vehicle to do an estimate, you taking the car to a claims center or even taking photos and sending to the carrier so they can prepare an estimate (crazy I know, but I've seen this).
Step 7 is where the concept of “total loss' comes into play.
What Happens When Your Vehicle is Totaled
ALL insurance companies have a formula they use to determine a total loss. It can vary from company to company so I can't offer up a concrete example. But I can offer this explanation- when an insurance company totals a vehicle, they are saying the cost to repair the vehicle exceeds (or is within a certain percentage) of the actual cash value of the vehicle. So it doesn't make any sense to repair the vehicle.
Although the definition of “Actual Cash Value” is replacement cost minus depreciation, in this case the market value and actual cash value are pretty close to the same thing. Kelley Blue Book is a popular resource to determine a car's value, but the carriers also have data sources at their disposal to search what a similar car in your area would sell for.
The insurance company will in essence “buy” the car from you by paying the actual cash value. You'll sign over the title and they take possession of the car. Most of the time they sell it to a scrapyard for salvage, as a way to recoup some of their cost.
Can I Keep the Totaled Vehicle?
In most situations, you can. But keeping a totaled car brings with it several problems, including getting insurance. Read our article “Can I Get Insurance on a Vehicle with a Salvage Title” for the pitfalls and nuts & bolts of the process.
If you've ever been in an auto accident, it can be scary and confusing. We do our best to take away the confusion and will work with our customers (when requested) if they need help through the claims process. We work hard to be your advocate and stand up for you. If you want the same experience, call or click today to discuss your Ohio auto insurance. We'd love to help!