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Settling a total loss claim involves several steps that can be complex. When an insurance company declares a vehicle a total loss, it means the cost of repairs exceeds the car’s value. The settlement process typically includes assessing the vehicle’s value, negotiating with the insurer, and finalizing the payout. Understanding this process is crucial for ensuring a fair outcome and dealing the complexities of insurance claims effectively.

Key steps in settling a total loss claim

  • Assessment and inspection – An insurance adjuster examines your damaged car to determine if it’s a total loss. They assess the extent of damage and calculate repair costs.
  • Pre-accident value – The adjuster determines your car’s pre-accident value, often called Actual Cash Value (ACV), by considering factors like make, model, mileage, and condition.
  • Repair cost comparison – The cost of repairs is compared to the car’s ACV. If repairs exceed a certain percentage of the ACV, it’s likely to be declared a total loss.
  • Settlement offer – If your car is deemed a total loss, the insurance company will offer a settlement. This settlement is usually the ACV minus your deductible.
  • Accepting the offer – If you agree with the settlement offer, you’ll sign the necessary paperwork to finalize the claim. The car insurance company will then issue the payment.

Buying back your car

If you wish to keep your totaled car, you can ask the insurance company about the option to repurchase it at salvage value. In this case, the salvage value will reduce the settlement amount, and you can then repair the car yourself.


Understanding the steps in settling a total loss claim can help you navigate the process more confidently. You should know about the policy, the offer given, and any potential options for retaining your totaled vehicle.