Georgia does not have a law in place that dictates when a motor vehicle should be considered a total loss. However, many insurance companies have criteria determining whether a car is deemed to be totaled.
In many cases, if the cost of repairing the vehicle is more than the vehicle’s fair market value, the insurance company will consider the car totaled. However, not every insurance company uses this standard. An attorney can explain more about what you can expect if an insurance company totals your vehicle.
What Determines Whether a Car Is Totaled in Georgia?
In Georgia, insurance companies determine when a motor vehicle is considered totaled. As a result, insurance companies can take different approaches to decide whether they should declare a vehicle a total loss.
Some insurance companies consider vehicles totaled if the cost of the repairs will be more expensive than the value of the car. For example, if a vehicle is worth $10,000, but the repairs cost $15,000, the insurance company would likely total this vehicle out.
Other insurance companies consider a vehicle totaled based on the percentage of the vehicle’s worth—usually 70% or more. For example, if your car was worth $10,000, it will consider the vehicle totaled if the cost of the repairs is at least $7,000. Each insurance company has the discretion to choose what percentage they consider for their valuation of a damaged vehicle.
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How Insurance Companies Handle Totaled Vehicles
Although Georgia does not have a law that determines when a vehicle is totaled, state law does govern how insurance companies can handle total losses. Under Georgia Rule 120-2-52-.06, the insurance company has two options:
- Cash Equivalent Method: The insurance company can pay the actual cost, minus the deductible, so you can purchase a similar vehicle of the same make, model, and mileage.
- Replacement Vehicle Method: The insurance company can replace the car with a similar vehicle of the same make, same or newer model year, mileage, body style, and other options.
Since Georgia is a fault state for car accidents and insurance purposes, your car accident attorney will contact the liable party’s insurance provider to determine how they have evaluated the damage to your vehicle.
You can expect the insurance company to do everything possible to lower the value of your claim, as this will reduce their payout. For this reason, it is critical that you get a trusted Georgia car accident lawyer on your side who will ensure a fair and accurate valuation of your vehicle.
What Happens When Your Car Is Totaled in Georgia?
It is more common than you might think for accident victims to want to keep their totaled vehicle. However, it is up to the insurance company whether it allows you to keep your car after the insurer declares it a total loss.
Vehicles that are considered total losses often have some value. As a result, the insurance company will expect you to leave the car with it in exchange for your insurance settlement. The insurance company may take the vehicle to a junk or scrap yard to recover some of the compensation it paid out on your claim.
However, if you can keep your vehicle, you must follow several steps to obtain a salvaged vehicle title. It must pass inspection and get registered as a salvaged vehicle before taking it out on the roads. This way, you can be sure that it is safe and legal to drive.
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How Is Your Case Affected if You Still Owe on Your Car?
There are several ways your claim could be affected if you still owe money on your totaled vehicle. However, the amount you owe on your car will not affect the determination of your vehicle’s value after a crash. For example, even if you still owe $5,000 on a $15,000 vehicle, the vehicle is still worth $15,000.
However, unless you purchased gap insurance as part of your auto insurance policy, you will still need to pay off the remaining amount of your loan. In this case, after you receive your $15,000 insurance settlement, you will then pay the remaining $5,000 you owe on your vehicle to pay off the loan.
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Meet With a Georgia Car Accident Lawyer Today
If you sustained severe injuries in a car accident and believe your vehicle is totaled, reach out to a dedicated Georgia car accident lawyer at Kaine Law for help holding the insurance company accountable for their financial obligation.
Schedule your no-cost, risk-free consultation today when you fill out our convenient contact form or call our office to discuss the details of your case.