What Happens if My Car is Totaled in an Accident?

You were driving your pride and joy down the highway on a sunny day without a care in the world.  The stereo was belting out your favorite song, and the weekend was just around the corner. What could possibly go wrong? Suddenly, the answer to that question appeared in the form of a pickup truck on the wrong side of the road. The collision was inevitable; the damage was colossal, and you feel your once beautiful motor has been totaled. The insurance company disagrees, however, so it’s probably time to call in a Portland property damage attorney.

Who decides whether my car is a total loss?

A number of factors will be used to determine whether or not your car is a total loss. An insurance claim adjuster will look to see whether:

• The damage to the car is so severe it cannot be repaired safely
• The cost of repairs is more than the car is actually worth
• The damage is severe enough that Oregon laws require the car to be declared a total loss

Once the insurance adjuster has arranged an inspection of your car—which should occur within a day or two after the accident occurred—they will inform you whether or not your car has been “written off.” At that stage, you will probably be asked to remove any personal items from the car, such as CD’s, documents, any clothing left behind, etc. The adjuster will also want a key to your vehicle, and will no doubt ask you to fill out the necessary forms, explaining your version of what happened. You will also be asked for contact information, which will be provided to whatever financial institution organized the finance on your vehicle.

My car is worth a lot more to me than blue book value.

Let’s face it. When your car has been totaled, no one wins. And about the only ones who don’t lose are the finance companies. A Portland property damage attorney will advise you what your vehicle is actually worth, should you be unwilling to accept the insurance company’s offer. Be aware that even if the actual cash value (ACV) is about what you expected, you won’t receive that amount in a write off situation. You may have treated your car like a baby, but the insurance company’s offer will be based on cars of a similar age, with similar mileage and with similar optional extras to your own. The insurance company’s procedures will be to:

• Determine the ACV of your vehicle
• Add on applicable state fees and taxes
• The settlement will then be reduced by the deductible amount on your policy.
• The insurance company will also determine a scrappage value for your car, but this is a tricky area. In some cases, if you surrender the vehicle, the insurance company will pay you what they deem a “fair” scrappage value. If you decide to hold onto the car, for sentimental reasons or because you think you could get more for it yourself, the insurance company may allow this, but they will deduct the scrappage value from your settlement offer.

It’s not necessary to accept the first offer the insurance company makes you. Remember, insurers have a vested interest in paying the smallest possible settlements, and you may want a Portland property damage attorney to negotiate a better offer for your car. Rather than just accepting the NADA “blue book” offer, try comparing the value of your vehicle with those on www.Edmunds.com, which may give a fairer reflection of what your car was really worth.

If I owe money on the car, who gets paid first? 

As stated earlier, the finance companies are the only ones not to lose out in these situations. Once a final settlement figure has been agreed, if you own the vehicle outright, you will receive the check in your own name. If, however, a finance agreement is in place, the payment to settle that agreement in full will be made to the finance company first. If there’s anything left over, you’ll get the balance, but if the settlement doesn’t cover what you owe the finance company, you’ll still be responsible for the balance.

Paying for a car that you’ll never drive again is a horrible reality that no one wants to face, but many end up having to deal with. There is a way to protect yourself against this eventuality, however. “Gap insurance” will cover you for unpaid balances in just such a situation, and you should check with your finance company to see whether you have gap insurance built into your agreement.

Having your car written off is a miserable, traumatic event for drivers of all ages. Yet it happens every day in Oregon and across the rest of the country as well. You can protect yourself financially by having appropriate insurance cover, including gap insurance built into your finance agreement. If, however, you feel you are being unfairly treated by the insurance company, or you simply want some good advice, then contact a reputable, experienced Portland property damage and injury attorney, who will listen to your story and then clearly explain the various options that are open to you.