A total loss vehicle has undergone an insurance incident and been deemed to have less residual value than the cost of repairs. In some cases, the maze of insurance regulations means that even vehicles that would cost less to repair than they’re worth can be deemed a total loss. To make matters more complicated, most insurance agencies have completely unique protocols for deeming cars as a total loss — and if that wasn’t enough, each state has its own insurance laws.

What’s the key takeaway here? There are a lot of perfectly good vehicles sitting in salvage lots for reasons that only lawyers will understand.

What Factors Determine if a Vehicle is a Total Loss?

As we mentioned earlier, how a vehicle is determined a total loss can be very complicated due to both state regulations and insurance agency policies. The unifying principle is that the cost to repair a vehicle has exceeded its total value. That said, there are plenty of exceptions.

Say that you’re driving an older vehicle, you get into an accident, and the cost of repairs make up 75% of the vehicle’s value. Many insurance agencies will go ahead and total this car. That’s because each state has specific laws about the allowable loss of value a car can experience before it’s designated a salvage title vehicle. This is called the Total Loss Threshold. Because of this factor, insurance agencies will add the Total Loss Threshold (legal salvage value) to the cost of repairs to see if it is greater than the actual cash value of the car. If it isn’t, the vehicle is “totaled.”

Cost of Repair + Salvage Value > Actual Cash Value

As we mentioned, previously, there are many “totaled” vehicles out there that are driveable, and cost-effectively repairable in the right hands. That’s where AutoSavvy comes in.

We efficiently and effectively restore total loss vehicles to excellent condition and pass the savings onto you and your family in the form of a safe vehicle that will last you for years to come.

Come to AutoSavvy to Take a Test Drive

Now that you know what a total loss vehicle is and what determines if a car is a total loss, you can explore our inventory of branded title vehicles, fill out a pre-approval, or contact us online with any questions. Have questions unrelated to how a vehicle is deemed a total loss? We can answer those too. You can also explore our library of helpful guides on popular topics about branded title vehicles. We cover everything from the types of hail damage to everything you need to know about rebuilt titles and more!