Car Salvage Value is important after you have an accident and your car becomes useless as your insurance company will have to pay up. Has your car been “totaled” by the insurance company claims adjuster? Is it now being towed to a salvage yard because it has been rendered unusable in an accident?

The laws of states vary somewhat, but typically there are state laws involved with “totaled” vehicles in order to keep unsafe “junk” from being driven on public highways. Part of each insurance companies’ procedures must follow the state statutes in order to comply in the claims process.

Generally, the definition of “totaled” means the cost of repairing the vehicle will exceed its “blue book” trade-in value, or a value which is the lowest possible price that a similar car can be purchased by a car dealer.

So, if your car is worth $4,695 trade in value, but the body shop will require $7,000 from the insurance company to repair it, then the claims adjuster will have no other choice by state law, and the insurance companies’ own guidelines, than to total the vehicle.

Assuming the Collision portion of your auto insurance policy has a $500 deductible, you would receive from them a check for $4,195, which would be the Actual Cash Value (ACV) of the vehicle, $4,695, minus the $500 deductible. Of course this is a hypothetical example and may be overly simplified.

For more information on how the worth of your vehicle is determined it is usually done by comparing your vehicle’s model condition to similar vehicles in your area. This may include input from local auto dealers, private parties or recent sales which the adjusters use in their valuation. Condition, equipment and mileage differences are all taken into consideration.

In addition, your insurance company may use a computerized evaluation process to assist them in determining the value of your vehicle. Insurance companies purchase third party computer systems that help them estimate costs in automotive claims and collision repairs. Third party software supplies insurers with software and a database that helps determine the value of a vehicle based upon automating the claims process. These systems have databases and systems that contain benchmarking tools to find the true value of a vehicle from repair shops and dealers.

Once an the ACV amount of your vehicle is determined and accepted by you, if you want to negotiate on the amount you will need to prove to the insurer that your car is worth more than their offer usually this is done by proving from local dealers estimates that your car was worth more, than the vehicle would become the property of the insurer so that you could receive your settlement payment.

So the insurance company would, by state law have you sign over the title of the vehicle to them and take legal possession of your vehicle. They then normally sell the vehicle to a salvage yard and have them pick up the car. If the car is not junked then it is required to have a special state issued (branded) title, which is called a “salvage title” in most states.

In many states a salvage titled vehicle legally indicates the status of the car is one that means it is not drivable on the roadway. Now, usable parts will be taken off the car, and eventually the shell and frame will be sent to the auto crusher and sold so the steel can be mel

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