Can You Prevent The Insurance Company From Totaling Your Vehicle?
When you're involved in an accident, your insurance company will inspect the car to determine how much it will cost to repair it. If the repair costs exceed the vehicle's value, the company will typically total it and cut you a check for the market price of the car. However, you will usually be required to relinquish the vehicle in return. But what if you want to keep it for practical or sentimental reasons? You have a couple of options for making this happen.
Prove the Vehicle Is Worth More
The general consensus is if a vehicle costs more to fix than it's worth, it should be discarded. However, auto insurance companies may have a lower threshold when it comes to determining whether to scrap a vehicle or not. For instance, if the car is worth $5,000 but will cost $4,000 to fix, the insurance company may total the car even though the repairs are less than the vehicle's value.
Each insurance company has its own formula it uses to figure out when they'll total a vehicle, and sometimes that value is determined by state law. In New Hampshire, for instance, the damage must be 75 percent of the vehicle's market value before an insurance company can declare it a total loss.
In either event, showing the vehicle is worth more than the insurance company is valuing it may prevent it from being totaled. For instance, vehicles with low mileage and in excellent condition are typically worth more than those with a few dings in them. If you can prove you took great care of the car, it might increase its market value enough to skew the threshold in your favor.
Vehicles with customizations may also be worth more than those with standard offerings. Providing the insurance company with a workup of changes you made to the vehicle and the positive effect they've had on the vehicle's value may also result in a higher price.
Take a Payout
The other option available is to tell the insurance company you want to keep the vehicle and take a payout. The company will typically cut you a check for the market value minus your policy deductible. You can then put that money towards the repairs and pay the difference out of pocket.
Be aware, though, this may not always be the best move. Car accidents are unpredictable, and the damage the vehicle sustained may be more extensive than you realize. There could be hidden damage you won't know about until the mechanic takes the car apart to fix it. Before opting for the payout, have the vehicle thoroughly inspected by a mechanic you trust to give you the real cost of fixing the issues to help you determine if you can afford to pay for those repairs.
For more information about this issue or help with an auto accident case, contact an attorney like Palmetto Injury Lawyers.