How to Handle Auto Insurance After a Totaled Car

Your auto insurance is an essential and often legally required investment that can help offset losses and expenses following vehicle-related incidents. But what happens when your car is damaged beyond repair? In the event of a total loss, handling the resulting auto insurance claims process and understanding your best course of action can be stressful and complicated. Fortunately, the dedicated team at Auto Pilot Insurance in Dallas, Texas, is standing by with guidance for these difficult situations.

When Is a Car Totaled?

You should first understand that in terms of auto insurance, “totaled” does not necessarily mean a car is completely destroyed. Rather, the industry generally considers a totaled vehicle to be one that would cost more to repair than it’s currently worth. After submitting a claim, your insurance carrier will typically send an adjuster to inspect your car, including its structure, value and condition, to determine if it qualifies as a total loss. Your location may also be relevant to this determination, as some states automatically label an automobile to be totaled if repair costs exceed a certain percentage of its assessed worth.

Am I Covered for Total Losses?

Depending on how your vehicle was damaged and the details of your auto insurance, you may receive a payout for your losses. For example, if your car was totaled due to a crash, collision coverage could assist, while damage caused by other incidents, such as a fallen tree, could require comprehensive coverage. If another driver is at fault for the damage, their own liability coverage will likely be tapped. If the responsible party lacks appropriate insurance, uninsured/underinsured motorist coverage may prove essential.

Total losses also inherently bring up the subject of gap insurance. This part of an auto insurance policy can be a critical investment if you’ve financed your vehicle. That’s because, due to depreciation, your vehicle could eventually be worth less than what you may still owe on your auto loan. In these situations, and when dealing with a totaled vehicle, lacking gap coverage would mean that your payout could not cover the outstanding balance on your loan. However, by including this component in your auto insurance, you can receive enough aid to pay off your lender and absolve yourself of remaining financial obligations.

We’re Here to Help

At Auto Pilot Insurance, we’re well-versed in auto insurance and will ensure you have the right coverage even when facing total losses. Contact us today to learn more or compare personalized quotes.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.