3 Things To Know About Car Insurance And A Totaled Car
If you ever encounter a car accident that is so bad it leaves you with a totaled car, or severely damaged car, you may wonder how your claim will work. The good news is that if you did not cause the accident, the other person's insurance should pay your repair bill, and here are several important things to understand about car repairs and compensation for a totaled car.
What makes a car totaled
The first thing to understand is how insurance companies even determine that a car is totaled, and this depends on the insurance company and the state. In some cases, a car is considered a totaled vehicle if it would cost more to fix it than what the car is actually worth. In other situations, they use a percentage method. For example, they may label a car totaled if the damages are 75% of the value of the car. If you are not sure how your insurance company determines this, you could always ask them if you are curious.
The effects when you cause the accident
It is also important to note the differences between if you cause the accident versus if someone else causes it. If you cause it, it is your insurance that must pay for the claim, but this would only occur if you have collision coverage. If you do not have collision coverage, your insurance company would not pay anything for your damages. If you have collision, the insurance would pay the total of the value of the car if the car is totaled; however, you might have to pay the deductible first.
The effects when someone else causes the accident
When someone else causes the collision that leads to your car being totaled, it is their insurance that pays the bill; however, if they did not have any insurance, your policy would likely cover the damages.
Other things to know about dealing with a totaled car claim
One last thing to know is that having gap coverage on your car is important if your car is valuable, as it pays the difference between the value of your car and the amount you owe. Without gap coverage, you might end up owing money on a totaled car that you cannot even drive or use.
Accidents can occur at any moment in time, and that is the top reason you should always have auto insurance. If you would like a quote for coverage on your car, talk to an auto insurance agent.