1. What is a Totaled Car?

A totaled car is a vehicle that has been damaged to the extent that the cost of repairs exceeds a certain percentage of the car's actual cash value (ACV). Insurance companies declare a car "totaled" when it's not economically feasible to repair it.

2. How Insurance Determines a Totaled Car

Insurance companies use a standard formula to determine if a car should be totaled:

Where:

• Repair Cost — Estimated cost to repair the vehicle to pre-accident condition
• Threshold % — Percentage set by insurance company or state (typically 70-80%)
• ACV — Actual Cash Value of the vehicle before the accident

3. Understanding the Calculation

Example: If a car has an ACV of $10,000 and the threshold is 75%, the repair cost threshold would be $7,500. If repairs cost $8,000, the car would be declared totaled.

4. Using the Calculator

Tips: Enter the estimated repair cost, your insurance company's threshold percentage (or your state's required percentage), and the actual cash value of your vehicle before the accident.

5. Frequently Asked Questions (FAQ)

Q1: What is the typical threshold percentage?
A: Most insurers use 70-80%, but this varies by company and state regulations. Some states mandate specific percentages.

Q2: How is ACV determined?
A: ACV is the market value of your car before the accident, considering age, mileage, condition, and comparable sales.

Q3: Can I keep a totaled car?
A: In most cases yes, but you'll receive a reduced payout and the car will have a salvage title.

Q4: What if I disagree with the insurance company's valuation?
A: You can negotiate, provide evidence of higher value, or in some cases hire an independent appraiser.

Q5: Does this apply to leased vehicles?
A: Yes, but the leasing company may have additional requirements or policies.