Total Loss Vehicles
Some motor vehicle accidents in Michigan cause minor damage to your vehicle. In this situation, an insurance company can provide you with compensation for professional repairs. However, some collisions result in a total loss or a totaled vehicle.
Drivers can still get compensation for total loss vehicles. Learn more about how this process works with our team at Encore Insurance Group.
No-Fault Insurance and Total Loss Vehicles
Michigan has a no-fault auto insurance system. No-fault insurance means that you can get compensation for many of your claim related expenses directly from your own insurance company.
Car insurance can provide compensation even if your vehicle gets totaled in the accident. Your insurance company will review your vehicle’s actual cash value (ACV) when determining how much compensation you will receive after an accident totals your car.
Totaled Vehicles and No-Fault Insurance in Michigan
How does the insurance company issuing a no-fault insurance policy determine if your car should be totaled or not? Often, this decision comes down to a mathematical calculation. No-fault insurance in Michigan may cover the repairs for your vehicle if the cost of vehicle repairs AND the salvage value of the vehicle do not exceed 75% of your vehicle’s ACV.
We can review this calculation using an example to help you better understand the deliberation by insurance agents. Let’s say that your vehicle had a pre-crash value of $10,000. Repairs would cost $5,000. The salvage value of the vehicle is $2,000.
The sum of your repair cost and salvage value equals $7,000 in this example. $7,000 is 70% of $10,000. In this situation, the insurance company would not declare your vehicle a total loss.
Getting a Title for a Total Loss Vehicle
Many drivers in Michigan wonder if they can keep the title for their vehicle after insurance claims adjusters declare it a total loss. In some situations, you can keep the title and your vehicle.
Drivers receive a salvage title if assessors consider their vehicle 75% to 90% damaged. Salvage titles are orange and depreciate the value of your vehicle. You can get a new registration for a vehicle with a salvage title, but only after a company completes repairs and you get the vehicle inspected.
Determining the Actual Cash Value of a Vehicle
Insurance claim adjusters consider the ACV of your vehicle when deciding whether or not to declare it totaled. Determining the value of your vehicle requires our insurance agents to look at the following:
- Condition of your vehicle
- The vehicle’s current mileage
- Any options you selected when buying the vehicle
You may also hear the ACV called the private property value. Generally, your ACV represents an estimation of what someone would pay for your vehicle (pre-accident) if you tried to sell it privately.
Your insurance policy may cover vehicle repairs or reimbursement for a new vehicle in the aftermath of a car accident. We can also help you discuss your options to get coverage for your medical expenses. Depending upon your policy, you may have to pay a deductible before insurance kicks in.
Ask a No-Fault Insurance Agent About Total Loss Vehicles
Do you have more questions about total loss vehicles in Michigan? Allow a no-fault insurance agent to provide you with the answers you want. You can reach our team at Encore Insurance Group at (248) 466-0200. We also have an online contact form that allows you to discuss your insurance options in Michigan.