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Texas Department of Insurance
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September 1, 2022

How to deal with a totaled car


One thing most drivers don’t want to hear after a car accident is, “Sorry, your car is totaled.” Learn what that means and what your options are.

What does “totaled” mean?

Totaled means that the cost to repair your car is more than its worth. If your car is worth $10,000, and the cost of repairs is $12,000, the insurance company will want to pay the lower of the two.

How does the insurance company decide to total my car?

Insurance companies use computer programs and databases to estimate the cost of repairs and the value of your car.

What can I do if I think my car is worth more than the insurance company says?

If your own insurance company is paying for repairs, you can ask them to reconsider the value. You may need to do some research. Find out what a car like yours – the same make and year – would sell for in your area. Get written quotes from used car dealers.

You can also ask for an appraisal. You and the company each hire an appraiser to determine the value of your car. The appraisers choose a third appraiser to act as an umpire.

How does my company decide how much to pay me?

It depends on your policy. If you have a “replacement cost” policy, you may get paid what your car is worth at today’s cost. Or, if you have an “actual cash value” policy, the money you get may be based on the age of your car.

Can I keep my totaled car?

Yes, you have the option to keep your car. Tell your company you want to keep it and the company will take off the “salvage value” amount. That means if they can get $3,000 for your car at an auto auction, they will lower the amount they pay you by $3,000.

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