A totaled vehicle is a phrase that you will hear after your vehicle gets damaged in an accident. Auto insurers will declare a totaled vehicle and even though many people think that this refers to the severity of the collision, in fact, your car can get totaled even if it has minor damage such as a dent. Everything depends on the vehicle’s value.
If this seems complex and you fear that you may be missing something, make sure to talk to a New Mexico car accident attorney. Here is what you need to do after the crash.
Determining a Total Loss and Cash Value by the Insurance Company
After the accident, the insurance company will calculate the auto’s cash value when the accident occurred. The actual cash value is calculated by considering the vehicle’s age, model, build, condition, demand, and the resale value of the parts and metal (salvage value). Finally, the insurer will determine the potential for unseen damage. If the crash wasn’t so harsh, the vehicle will have less unseen damage. Heavy damage will result in a totaled vehicle.
Total loss is declared if the reparation costs exceed the actual cash value. If the vehicle has severe damage that cannot be repaired, then a total loss will be declared. Every auto insurance company has policies and standards they will use when determining if your vehicle should be declared a total loss. If the vehicle is declared a total loss (a totaled vehicle, in other words) by one auto insurance company, the same will be considered by another.
Actual Cash Value vs. Damage
If your car’s current worth is $5000, and you have hit a parked vehicle and caused $500 damage to your car, then the damage isn’t even close to the actual worth of your vehicle. You’ll have to check for the number of damages, or it will be fixed directly for you. If your vehicle is cheaper, let’s say $2000, in such a case the amount of repairs is higher than the actual value of your car. In that case, you can expect it to be declared a totaled vehicle, and you can’t expect an offer higher than $2000, or the price the vehicle had before the damages.
Cash Settlements & Keeping Your Totaled Car
You can accept the cash settlement from your insurers which usually won’t be higher than the cash value of your car. The damaged vehicle will be returned to you after deducting the salvage value. Then, it will be marked as a salvaged vehicle. You can have another option – you can accept a settlement value from your auto insurers and give your totaled car away.
Take the statement value and it will go directly to you if you own the car. If you have a loan, the payment will be funded to the lienholder first. If there is some extra money, it will be refunded to you. This is a popular option because people get some cash this way, so they can buy another car. Many people choose this way so they won’t have to worry and deal with the damages of their old car.
What To Do After a Totaled Vehicle
Make sure to clean the car and remove your belongings from the vehicle (valuable things, important papers). Report the accident and file for a claim (make sure not to wait for the deadline). The sooner your insurers start to work on your case, the better. The car needs a reparation, so take it to the shop. In most cases the insurers will suggest their preferred shop; accept this suggestion so the work can be done faster.
Next, you’ll have to sign a title for the insurers and fill in the necessary work. The total loss accidents require a lot of paperwork, so finishing it on time will speed up the process. If all of this seems like a challenge for you, or you fear that you might not do things right without legal assistance, contact our office.
Here at FBD Law, we’ll do our best to review your case and help you with all the paperwork that comes along. Many accident victims aren’t capable of doing this while recovering, so they feel more secure if they have a car accident attorney by their side. Don’t let time pass by, since the New Mexico car accident statute of limitations lasts three years from the date of the accident. We’re here to take care of everything and help you get the compensation claim you deserve.