When your car is involved in an accident or suffers severe damage, your insurer may declare it a total loss. But what does that mean, and how does it affect you as a policyholder?
What Does Total Loss Mean?
A car is considered a total loss when the cost of repairs exceeds a certain percentage of its market value, typically 50% to 75%, depending on your insurer and local regulations. It can also be declared a total loss if the car is so damaged that it is unsafe to repair.
Types of Total Loss
What Happens After Your Car is Declared a Total Loss?
Once your insurer determines that your car is a total loss, the following steps typically occur:
What If You Still Owe Money on Your Car?
If you have a loan on the car, the payout will first go to the lender.If the settlement is lower than what you owe, you may have to cover the remaining balance unless you have gap insurance, which covers the difference.
How to Ensure a Fair Payout?
Conclusion
Understanding total loss helps you navigate the claims process efficiently. Reviewing your policy and considering gap insurance can preventfinancial surprises if your car is declared a total loss.
When you're on the road, the last thing you want is for your car to break down unexpectedly. Whether you're driving through a quiet country road or stuck in heavy traffic, the situation can quickly turn stressful and inconvenient. That's where roadside assistance cover comes into play. This service can be a lifesaver when you encounter problems like flat tires, engine failure, or even running out of gas. But why is roadside assistance cover so essential? Let’s explore.
