What To Do With A Totaled Car? - Diamond and Diamond Lawyers
  • Tuesday, 19 January 2021

What To Do With A Totaled Car?

Saying goodbye to something you love or need is never easy. A car is an essential piece of equipment to most of us, without which our everyday activities are severely impacted. Without it, you can’t pick up the kids from school and getting to work becomes a significant problem. 

Total loss accidents encompass everything from hitting a deer to disastrous collisions. In some cases, the physical car damage may not appear to be that bad. Yet, due to expensive parts needing replacement, the repairs may exceed the vehicle’s value, resulting in it being written off. 

Whatever the reason behind your insurer’s decision, dealing with a total loss accident is more intricate than getting your car repaired. These claims typically involve more steps than usual, and knowing what to do is essential. It’ll speed up the process, ensuring that you get compensated quicker.

Common causes leading to total loss collisions include:

However, having a thorough understanding of the situation and knowing what to do with a totalled car can help. These options are discussed below.

Take the Money from Your Car Insurance

Take the Money from Your Car Insurance

Your first option is to take the insurer’s money and use it to buy a new vehicle or settle the outstanding balance on the damaged one. Following an accident, the at-fault driver or your insurance will inform you of the automobile’s actual cash value. They’ll then make a decision to total your car primarily based on repair costs. 

The various provinces and insurance companies all have their own formula for determining a totalled vehicle. However, should the vehicle damage exceed 51 percent of the car’s overall value, it’s at the insurer’s discretion to either fix or write it off.

After determining the value, the insurer will compensate you with that amount; less the deductible should you claim from your own policy. In essence, the insurance company bought the damaged car from you, and they retain the vehicle’s title.

Should you need help dealing with the insurance companies, Diamond & Diamond can assist you. Our team of lawyers has the experience and knowledge to negotiate on your behalf.

Keep Your Totalled Car and Have it Fixed

You want to consider keeping the car if you can still safely drive or have it towed to a repair shop. 

Taking this route leaves you with one of two choices. You can decide not to file a claim and pay for the damages out-of-pocket. Alternatively, you can file a claim and opt to keep your car, should the insurance allow you to do so.

However, you won’t receive the full compensation amount. Instead, the settlement offer will be decreased by the vehicle’s salvage price and a deductible, should the accident be your fault. The insurer will issue you with a cheque for the excess amount and a salvage title.

Assuming you settle for this option, you’ll need to obtain a rebuilt title and roadworthy certificate for the car. If you can do the work yourself or have a friend that can do it for you, fixing a totalled vehicle may be worth it.

It’s important to note that it’s usually up to the insurer to determine the compensation amount that you’ll get from them. 

Salvage Parts of Your Totalled Car and Sell Them

Salvage Parts of Your Totalled Car and Sell Them

If your budget doesn’t allow for you to fix your damaged vehicle out-of-pocket, you’ve got the option to salvage and sell its parts. 

New parts are typically a lot more expensive than high-quality used parts. For this reason, most car owners are willing to pay good money for working components that are hard-to-find or no longer in production to fix their vehicles.

Entities that frequently buy salvaged parts include:

  • Repair shops
  • Local mechanics
  • Online groups or forums
  • Scrap yards
  • Collectors

Alternatively, you can also use the parts to fix another car you may have.

Donate Your Totalled Car

Another option you may want to consider is giving your totalled car to charity. Donation services will collect the vehicle from where it’s kept, tow it at their cost and sell the salvaged parts to gain funds for the foundation. Taking this route will entitle you to a tax deduction for the depreciated value of the vehicle.

The immediate aftermath of a car accident is exceptionally chaotic. In case of emergency, reach out to an Ontario personal lawyer from Diamond & Diamond to guide you through the insurance claim process.  

Send Your Totalled Car To The Junkyard

From time-to-time, insurance payouts aren’t significant enough to be useful or meaningful. If you want to avoid the hassle of dealing with the insurer or don’t have the time and patience to do so, you can send the totalled car to the junkyard.

Many scrap dealers will tow your vehicle for free and are usually willing to pay a reasonable sum for it. However, it’s advisable to get an estimated value of your totalled car before deciding to negotiate or deal with a junkyard.

Contact an Ontario Personal Lawyer from Diamond & Diamond

Suppose you need help negotiating with insurers or have recently been injured in a car accident. In that case, the personal injury lawyers at Diamond & Diamond can help you file a timely claim. Our law firm serves clients throughout the Alberta, Ontario, and British Columbia area. 

We’ve earned a reputation for being a proactive and assertive firm, applying our experience and knowledge to protect your rights. To schedule a free consultation with a Diamond & Diamond lawyer, call 1-800-567-HURT (4878) or use our online case evaluation tool.

PRO TIP:

“You can often get a better settlement after a car accident if you know the process, have some extra information on your side and talk to the right lawyers.”

Totalled Car FAQs:

When is a car considered totalled?

Insurers typically consider a car to be a write-off should the repair cost exceed the vehicle’s actual value. Some provinces also have laws defining a totalled automobile by specific thresholds. 

Therefore, should the vehicle be worth $10,000 and the repair estimate exceed $8,000, it may be considered a total loss. Should the province you reside in not have specific thresholds to determine an accident vehicle’s status, it’s up to the insurer to decide whether to write it off. 

Insurance companies typically use various factors to determine your vehicle’s actual cash value at the time of the accident, including:

  • The car’s age
  • Overall condition
  • Mileage
  • Resale value
  • The retail price of other similar vehicles in your immediate area

What happens to cars that are totalled?

Should an insurer decide that a vehicle is beyond repair due to repair costs being too high, it’ll most likely be declared a total loss. However, just because an insurance company writes it off, it doesn’t mean that no-one will never drive it again. Some are rebuilt and repaired.

In general however, totalled vehicles are stripped of their usable components, and what remains is sent to a car crusher. Even so, many states have imposed various regulations and laws covering totalled vehicles. Therefore, some of these automobiles wind up being rebuilt or repaired, issued with new titles and end up back on the road – often through illegal channels.

What should I do with my totalled car?

If your car was totalled after an accident, you’re most likely considering what to do with it. It’s essential to keep in mind that you’re not limited to one option. What you decide to do with it, however, will depend solely on your preference. The available options are:

  • File a claim and accept the settlement from your insurer.
  • Don’t file a claim and fix the vehicle out-of-pocket.
  • Opt to hold on to your car without repairing the damages (keep in mind that it should still be able to pass a roadworthy test).
  • Donate it to charity.
  • Buy the automobile from the insurer and fix it yourself.
  • Keep your car and sell the salvaged usable components.
  • Find a dealer that’ll accept a totalled vehicle as a trade-in on a new one.

To Wrap Up

If you’re involved in an accident, whether you’re at fault or not, and the repair costs end up being too high, the insurer will consider your car to be a total loss. When this happens, you can either accept the insurance company’s settlement or follow one of the other options discussed in this article.

Whatever your choice, the Diamond & Diamond team is there to assist you. Our experienced lawyers will file the insurance claim for you and pursue proper and fair compensation on your behalf.

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