Owning a car isn’t always easy riding. There are the issues of keeping up with car loan payments, making sure the registration is current, and finding affordable car insurance in Texas. But none of that matters when your car is totaled. After the shock of the experience, it’s hard to know where to even begin.
What do you need to know about totaled vehicles in Texas and what should you do when your car is totaled?
What Counts as a “Totaled” Vehicle in Texas?
In Texas, a vehicle is considered to be a total loss, or “totaled,” when the actual cash value (ACV) of the car is less than the value of the repair costs. Note that total repair costs include parts and labor but don’t include sales tax or the cost to repaint the car after it’s repaired.
Insurance companies in Texas use this definition to determine whether your car is worth repairing — or if it’s cheaper to send the car to a scrap yard and send you a check for your loss (if you have the right amount of coverage).
Most people think of a totaled car as one that’s been in a serious accident. While that’s certainly true in many cases, it’s possible for your car to be totaled even in a minor fender bender if you have an older car with a low ACV. Even if the damage looks small, hidden problems along with unavailable or hard-to-get replacement parts, can dramatically increase the cost of repairing your car.
What is Actual Cash Value in Texas?
The ACV is the difference between the original value of a car minus the lost value from depreciation.
For example, suppose that you purchased a car for $20,000. A few years later, you’re involved in an accident that will cost $8,500 in repairs. However, your car has lost $12,000 in value since you bought it, meaning that the ACV is now $8,000. In this case, the ACV is less than the total repair costs, and your car will be considered a totaled vehicle in Texas.
Will I Get Compensated if My Car is Totaled in TX?
It depends. If you were involved in an accident in Texas with another car and it wasn’t your fault, then you can make a claim with the other driver’s liability insurance company. If you were at fault for the accident, then your collision insurance company can compensate you if you decide to make a claim. And if your car was damaged by a natural disaster or from hitting an animal, then your comprehensive insurance coverage would take over.
In short, if you want to make sure you’ll get compensated for your totaled vehicle in Texas, then don’t drop collision and comprehensive coverage.
What to Do If Your Car is Totaled in Texas
Dealing with a totaled vehicle in Texas is different from any other kind of insurance claim. Here are four steps to take when your car is totaled.
IMPORTANT NOTE: These steps assume that you’ve already ensured that everyone involved in the accident is safe and that you’ve moved your car off the road if possible. If you were just involved in a car accident, you should immediately call 911 — whether you think your car is totaled or not.
1. Call the Insurance Companies
The first thing you should do after your car is in a wreck is to contact your insurance company and make a claim. The sooner you get in touch, the more helpful the insurance company can be and the faster they’ll be able to process your claim. You’ll also have a much more accurate memory of what happened if you call soon after the accident.
While you’re at it, you should also call the insurance company of the other driver and explain the incident from your point of view. It’s always good practice for drivers to exchange insurance information after an accident. If it turns out that the other driver was at fault, then it’s their liability insurance that will compensate you for the loss of your car.
2. Take Your Car to an Approved Repair Shop
The next step is to bring your car to a repair shop so that you can get an estimate for the repairs. Most insurance companies have a list of approved auto repair shops, and working with one of them will help your claim be processed much more quickly.
If you think your car might be totaled, then chances are that you won’t be able to drive it. That’s why it’s important to have a reliable Texas roadside assistance service that can tow your car to a repair shop when the unexpected happens.
3. Research Your Car’s Value and Repair Costs
The insurance company will have its own internal sources and formulas for calculating the ACV of your car, but that doesn’t mean that you shouldn’t do your homework too. If you think that your car is worth more than their ACV, you may be able to convince the insurance company to adjust the value. The best way to do this is to get quotes from local used car dealerships and look up selling prices for similar cars online (just watch out for scams).
The same goes for repair costs. If you think the quoted repair costs are too high, look for quotes from nearby garages. By doing a little research, you can convince the insurance company that your car is worth saving.
4. Decide What You Want to Do With Your Totaled Car
If the insurance company still considers your car to be a total loss, then you have two options: accept the check or repair the car yourself.
If you decide to accept compensation from the insurance company, then they’ll take ownership of the car and recover its scrap value, and you can put the money toward buying a new car.
Another option for a totaled vehicle in Texas is to keep the car and pay for the repairs yourself. In this case, the insurance company will send you a check for the ACV minus the salvage value of the car — the value left from selling the car’s scrap metal and intact parts.
After the car is repaired, you’ll need a new title recording that the car is a salvage vehicle. If you absolutely need a car and can’t afford to buy a new one, repairing your totaled car could be a good option. However, keep in mind that a salvage title will drastically reduce the value of the car. You’ll also need to get the car inspected as well as find affordable car insurance in Texas before you can legally drive it again.
Protect Your Car with Affordable Car Insurance in Texas
Remember that unless another person is at fault for totaling your car, you won’t get any money for your totaled vehicle in Texas without collision and comprehensive coverage. At Baja Auto Insurance, we work with drivers all over the state to find the insurance they need at the best price. All it takes is a few minutes for a quote for affordable car insurance in Texas. Or feel free to visit our offices or give us a call at (800) 401-6870.