What should I do if my vehicle is deemed a total loss? (2025)
You might wonder what you should do if your vehicle is deemed a total loss. If insurance wants to total it, you need full coverage to pay your car's actual cash value, averaging $119/mo. Understand your options for a totaled car and how to get the most money from insurance for a totaled car below.
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Tracey L. Wells
Licensed Insurance Agent & Agency Owner
Tracey L. Wells is a licensed insurance agent and Farmers insurance agency owner with 23 years of experience. He is proud to be a local Farmers agent serving Grayson, Georgia and surrounding areas. With experience as both an underwriter and agent, he provides his customers with insight that others agents may not have. His agency offers all lines of insurance including home, life, auto, RV, busi...
Licensed Insurance Agent & Agency Owner
UPDATED: Jan 31, 2024
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Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider.
Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Jan 31, 2024
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider.
Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
You might wonder what to do if your vehicle is deemed a total loss. Maybe your insurance wants to total your car but you want to keep it. However, it’s usually best to file an auto insurance claim and collect a check for your vehicle’s actual cash value.
We’ll overview everything you need to know about total loss insurance, including what happens when your car is totaled, what to do when your car is totaled and you still owe money, and what happens when your car is totaled but still drivable. Enter your ZIP code above when you’re ready to compare quotes from the top providers.
What to Do When Your Vehicle Is Deemed a Total Loss
Your job is to file a claim with your insurance company so you can receive an ACV payout. If you suspect your vehicle will be deemed a total loss but haven’t contacted your insurance company yet, learn more about filing claims properly to ensure you’re compensated.
How much an ACV payout benefits may depend on how long you've had your car. Your car depreciates in value from the moment you take it off the lot, just like many other assets. Brand-new vehicles depreciate even faster.
Scott W. Johnson Licensed Insurance Agent
Learning how auto insurance companies value cars is important to understand what happens when your vehicle is deemed a total loss. For example, if you receive a $22,000 check for a vehicle worth $25,000 at market value, that’s because the insurance company calculates cash value and depreciation a bit differently than the market does.
Regardless, you still receive financial compensation for losing your vehicle. Even if you don’t get back as much as you hoped, you can still put that money toward replacing your car. To better understand ACV, here are some determining factors:
- Year
- Mileage
- Model
- Condition
- Vehicle history
- Personal customization
- Your location
If you’d like to understand even more about what your car is worth, you can learn how to get the total cash value of your vehicle.
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Total Loss Auto Insurance Definition
In the auto insurance world, a total loss is when your car costs more to repair than it is worth. In other words, it is when your car’s actual cash value (ACV) is lower than the cost to repair the damages.
When insurance companies evaluate bids for repairs, they’ll decide one of the following:
- Total loss: When the cost to repair plus salvage value is greater than ACV
- Proceed with repairs: When the cost to repair plus salvage value is less than ACV
Salvage value, in this context, refers to the residual value of the damaged vehicle before repairs.
So, what does auto insurance do for you after a total loss decision? It works differently than when the company pays to fix your car. If your vehicle is deemed a total loss, you will be paid your car’s ACV as it was the moment before the accident occurred, minus your deductible.
It’s also important to note the type of insurance you need when your vehicle is deemed a total loss. You should shop around for an affordable full coverage auto insurance policy, including collision and comprehensive coverages, to protect your car against total loss. Check out the table below to see how much you might pay for full coverage from the best auto insurance companies:
Full Coverage Auto Insurance Monthly Rates by Provider and Driving Record| Insurance Company | Clean Driving Record | One Speeding Violation | One Accident | One DUI Conviction |
|---|---|---|---|---|
| Allstate | $160 | $188 | $225 | $270 |
| American Family | $117 | $136 | $176 | $194 |
| Farmers | $139 | $173 | $198 | $193 |
| Geico | $80 | $106 | $132 | $216 |
| Liberty Mutual | $174 | $212 | $234 | $313 |
| Nationwide | $115 | $137 | $161 | $237 |
| Progressive | $105 | $140 | $186 | $140 |
| State Farm | $86 | $96 | $102 | $112 |
| Travelers | $99 | $134 | $139 | $206 |
| USAA | $59 | $67 | $78 | $108 |
While collision auto insurance coverage pays for total loss after head-on collision with another vehicle, comprehensive covers your car if it gets stolen or totaled by weather damage.
What to Do if You Owe More on a Loan Than You Receive as ACV Payout
You might wonder what to do when your car is totaled and you still owe money on a loan. If you receive a total-loss ACV payout less than what you owe, you’re still responsible for paying the difference. In that case, a type of coverage called gap insurance can protect you from this financially difficult situation.
Gap insurance covers the difference between your ACV payout and loan balance, and you can usually purchase it with your current insurance company. If you make a low down payment or take out a loan with a lengthy term, it’s a good idea to consider gap insurance.
Read More:
- What is gap insurance and do I need it when filing an auto insurance claim?
- How To Negotiate a Total Loss Auto Insurance Settlement
- Vehicle Depreciation and Its Effect on Auto Insurance Rates
How to Replace Your Total Loss Vehicle
If you’ve filed your claim correctly, you should receive a payment equal to the ACV of your car. You can then use that money to pay off any remaining loan balance and replace your vehicle.
You can consider financing or leasing if the money you receive doesn’t equate to the total cost of a car you want. You can also visit dealerships and private sellers and negotiate when appropriate.
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More About What to Do When Your Vehicle Is Deemed a Total Loss
Knowing that you will receive financial compensation in the event of a total loss should bring you peace of mind. However, whether this is enough to get the replacement car you want is another issue. Since cars depreciate constantly, you will receive less money than you originally paid for your car when your claim finalizes.
Frequently Asked Questions
Can I keep my car if it’s a total loss?
You may be able to keep the totaled vehicle. However, it might not be worth your time and effort. You need to get a salvage title that indicates that your car isn’t roadworthy until you complete extensive work. These cars are also difficult to insure as you will likely need a rebuilt title after securing a salvage title.
Who gets the insurance check when a car is totaled?
You’ll receive the check if you own the vehicle outright after it gets totaled. However, if you have an auto loan or lease, the check goes to the leasing company.
Do I need to notify the DMV if my car is totaled?
Usually, your car insurance company will notify the DMV if your car gets totaled.
How do I dispute a total loss on my vehicle?
As with other auto insurance claim decisions, you can file an appeal if you disagree with your insurance company.
If my car is totaled, will the insurance pay it off?
If you have full coverage, your insurance will send a check for the actual cash value of your vehicle if it gets totaled.
What happens to the license plates when a car is totaled?
Usually, you’ll be asked to remove the license plates and personal items from the vehicle. Then, you’ll want to either visit your DMV or mail them your license plates.
Will a total loss show up on my driving record?
A total loss should not appear on your driving record unless you were at fault for the accident that caused the damage. It may increase your monthly rates, but this depends on the insurance company, your driving history, and more
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Tracey L. Wells
Licensed Insurance Agent & Agency Owner
Tracey L. Wells is a licensed insurance agent and Farmers insurance agency owner with 23 years of experience. He is proud to be a local Farmers agent serving Grayson, Georgia and surrounding areas. With experience as both an underwriter and agent, he provides his customers with insight that others agents may not have. His agency offers all lines of insurance including home, life, auto, RV, busi...
Licensed Insurance Agent & Agency Owner
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.