Serious car accidents often result in having your car totaled. This is insurance speak for a total loss on a vehicle. Totaling out a car is the result of a mathematical formula. It is used to decide that your car is no longer worth repairing because it would cost more to fix than what it is worth. The formula is typically based on a percentage of the car’s total value. Sometimes a vehicle is declared a total loss when it is simply beyond repair. Payment is made to the owner of the car, and the insurance company will often then sell it for scrap.
Whose Insurance Company pays for my total loss?
Who pays for property damage to a vehicle, including a total loss, normally depends on who was at fault for the accident.
If the car accident was not your fault and the other driver’s insurance company is taking responsibility, they will be the ones paying out your total loss.
If the car accident was your fault and you are dealing with your own insurance company, the collision coverage portion of your auto insurance policy will be used. Remember, you likely have a deductible on your policy which must be subtracted before you are paid a settlement for your totaled car.
There is often a disagreement between insurance companies as to who was at fault for the accident. Your own insurance company may pay you for your car and then turn around to sue the other driver. They will be attempting to prove in court that they- your insurance company- should be reimbursed for the claim. This is called a subrogation action and is quite common in Illinois.
Who decides if my car is a total loss?
Insurance companies, not the car’s owner, will decide whether or not a car is totaled. This is determined by looking at the fair market value of your car. You have the right to know how the insurance company came up with their figure. This figure will not always match what is listed in a Kelly Blue Book, but using a resource like KBB is often a good place to start. The more details used which are specific to your car, the more accurate the estimate is going to be. For example, looking at the year, make, and model of your car isn’t enough. Mileage and the condition of the car before the accident also needs to be considered. There may be characteristics unique to your car that you can use to challenge the amount that the insurance company came up with. For example, a custom paint job or other “extras” that you added on to your car will increase the value. The insurance company isn’t going to ask you about things like brand new tires, so it’s up to you to speak up. Insurance companies always seek to protect their own bottom line to the greatest extent possible, which means that you should look into the value of your car in the Chicago area (or your specific locality). If you think that your car is worth more than what you are being offered, make a counteroffer to the insurance company and be prepared to back up your reasoning.
Do I need a Lawyer to deal with a Total Loss in Chicago?
Many Chicago area accident victims decide to deal with the property damage portion of their case on their own, without a lawyer. As long as you do not discuss your injuries with the other party’s insurance company during the course of your property damage claim, this approach often makes sense and can be used when the other insurance company has taken full responsibility for how the accident happened. At O’Connor Cadiz Law, we often take the position that it is not financially worth it for you, the car’s owner, to hire us to negotiate the property damage portion of your case, as you will then end up with less than your car’s value after paying legal fees. Just be cautious in discussing specifics on how the accident happened. If the other party’s insurance is taking responsibility, you may not need to go into it too much. The danger here is that your words could be misconstrued or twisted against you, especially if you haven’t really processed yet how everything happened.
What if I was hurt in a total loss accident that wasn’t my fault?
If your car was totaled in an accident, not only are you without a car, you or a passenger are likely also facing serious injuries to your body. It’s hard to know where to even begin in sorting out the mess with the insurance companies, but be aware that dealing with your property damage is a somewhat separate issue from dealing with your injury.
Property damage claims are usually wrapped up relatively quickly in comparison to the injury portion of your claim. This is because damage claims to your car are much more straightforward. Also, injury claims after a car accident will take longer because settlement discussions should not even begin until a person has completed their course of medical treatment (with some exceptions, due to legal time limits known as the statute of limitations).
Unless your injuries were minor, which is often not the case if your car was totaled, it is a very good idea to talk to an attorney early in the process. An experienced personal injury lawyer will ask you many questions about how the accident happened. The attorney will need to gain a clear understanding of how the events unfolded, in order to help you evaluate the strength of your case against the other driver. In the case of catastrophic injuries or death, it is often worthwhile to have your attorney hire an accident reconstruction engineer or to retrieve electronic data from the car, before your car is lost to the insurance company and sold off for scrap.
Keep all records, including police reports and photographs, as related to your car. This information will be useful in your personal injury case against the other driver. Personal injury claims are much more complicated than property damage claims. Unlike when dealing with a totaled car, it is not advisable to discuss what happened with the other insurance company at the outset. Details as to how the accident happened, as well as your injuries, should first be discussed with an attorney so that you can have a clear understanding of exactly what you may be up against.
If you were hurt in an accident, whether your car was totaled or not, and would like to discuss it with a Chicago area lawyer, feel free to give us a call to set up a phone call, or fill out a contact form on this site.