5 Tips to negotiate the best settlement for my totaled car


Save Money by Comparing Insurance Quotes
Compare Free Insurance Quotes Instantly
ZIP Code must be filled out!
 Secured with SHA-256 Encryption
writter logo
Written by
VP, People & Compliance
reviewer logo
Reviewed by
Licensed Auto Insurance Agent
UPDATED: 2021-06-16T17:54:49.403Z
Advertiser Disclosure

It’s all about you. We want to help you make the right coverage choices.

Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance provider and cannot guarantee quotes from any single provider.

Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different insurance companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

Editorial Guidelines: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance provider and cannot guarantee quotes from any single provider.
A totaled car on the side of the highway.

Having gone through two car accident negotiations with the auto insurance company within four months of each other due to two totaled car accidents (neither of which were our fault), it's apparent that understanding how to negotiate the best settlement for a totaled car is important to obtain the best deal on a totaled vehicle.

Many claimants accept the car insurance company's first offer, without reviewing the details of the offer. They assume their auto insurer is offering a fair payout for their car in its current condition. Many times, insured parties don't know what to expect.

For example, you may remember to tell the insurance claims adjuster the vehicle had a DVD player, but did you tell him/her that it was a split-screen DVD player? You may not realize it, but these types of added items may increase the settlement amount. There are also processes to challenge findings if you think the Kelley Blue Book value is higher.

If you do not have an agent, or if your agent is not particularly helpful, being armed with the best negotiation tactics could result in a higher settlement for you. Of course, it's important to get the facts. Putting in overly generous descriptions of your car on Kelley Blue Book won't get you a better payout. But first, get yourself familiar with the claims process.

Here are five tips on how to negotiate the best loss settlements for your totaled car.

1. Know what you are selling to your car insurance company.

If your insurance company deems your vehicle totaled, then according to certain policies, your insurer may need to buy your totaled car from you at a reasonable price. This is based on the value of your car immediately preceding the accident. By totaled, auto insurers generally mean the cost of repairs is greater than the actual cash value of the car.

It is in your best interest to provide the adjuster with the sticker details that accompanied your car when you purchased it. Some car insurance companies will total a vehicle if the damage to vehicle is at or above 51% of its pre-accident value. Other insurance companies will total it at 80%. It is within their discretion. If you think the damage is severe enough, though, you can also ask to have it totaled. A vehicle is considered a wrecked vehicle when it's so disabled that can't operate without substantial repair or reconstruction. If you keep it or your insurer tries to resell it, a car in this condition would be sold with a salvage title.

Didn't save the sticker? Contact the dealer where you purchased the vehicle and ask for a list of your vehicle's features. The dealer should keep records of the vehicles they have sold. This way, you can be sure you're getting the fair market value.

If you're unable to locate this information, then search online for your vehicle's year, make and model to determine exactly what features your vehicle had. Be sure to provide this information to the adjuster so that the adjuster may make the highest possible initial offer at the outset.

2. Prepare your counter offer.

After providing the adjuster with your vehicle's features, prepare your counter offer. Avoid waiting until you have the adjuster's offer to start your research. While they may come up with a fair value, doing your research after could lead to delays in your payout and therefore in your ability to get replacement coverage.

With the sticker or list of the vehicle’s features, one option is to visit nadaguides.com. Enter the information of your vehicle to determine the value of your car. Remember, the important amount is the retail value, not the trade-in value. You are not trading in your car; you are selling your car to the insurance company. Print the estimated retail amount and features used to determine the amount, as you will need to show this to the adjuster when you make the counter offer. Many sites offer a guide to how you should evaluate the condition of your vehicle as the current vehicle owner. Use this information wisely.

Also, find any receipts for any major work performed on your vehicle in the last seven or eight months, such as new tires. If you don't have the receipts, contact the mechanic and ask them to provide you with the receipt. If you've customized your car, keep in mind not all policies cover aftermarket upgrades.

3. Determine the comparables (comps) in the area.

Visit a few used car websites and print those that are for sale with similar features and mileage as yours. Some sites to visit include autotrader.com and cargurus.com.

Save Money by Comparing Insurance Quotes

Compare Free Insurance Quotes Instantly

ZIP Code must be filled out!

Secured with SHA-256 Encryption

4. Obtain a written settlement offer from the auto insurance company.

Once the adjuster contacts you with an offer, ask them to email it to you with the valuation report or CCC report (Certified Collateral Corporation report). Many insurance companies rely on this report to provide a market evaluation showing the value of the car and ultimately use it to determine the settlement amount. Confirm that all of your vehicle's features are considered on this report and that the report correctly lists the mileage. Upon receiving the written offer, ask the adjuster to show three additional items:

A. Sales tax   they are responsible to payout the state sales tax B.Payoff lien amount   the amount to be paid directly to the auto financing company for any outstanding vehicle loans C. Net settlement amount — the amount that you will receive from the company.

5. Make your counter offer for your totaled car.

Compare your written offer with NadaGuides.com (or similar website) and used car printouts you previously researched. Do they match up? Based on the these figures, determine a reasonable counter offer. Email the insurance carrier your counter offer and attach all documentation that you based your counter offer on, including the NadaGuides.com value, used cars reports, and recent repair costs. Without supporting documentation, your offer is less credible.

Proper research, documentation, and setting reasonable expectations should result in a fair settlement. If you believe you are not receiving a reasonable offer after negotiation attempts, contact your agent for guidance. In certain states, the office of consumer affairs may provide additional advice.

If the insurer totals your car, they will payout the car's actual cash value, minus your deductible. Your car will then sent to a salvage yard for an auction by the highest bidder and usually whacked up for parts. Insurance companies keep the money they got for the salvage vehicle.

What If You Want to Keep The Car? Do You Still Get an Insurance Payout?

What can you do if you want to keep the car because you don't agree with the insurance company's assessment of the damages? Options for keeping a totaled car are limited. Unfortunately, it could cost more to repair because not all the damage is immediately obvious. When you buy a car insurance policy, you sign a contract that says that you can't make your insurer payout more than your car is worth. In contrast, most states require insurance companies to follow the guidelines so you will be restored to the same financial condition you were in prior to the accident. If you still can't come to an agreement on value, you can contact a consumer representative at your state's insurance departments.

Bear in mind that you might not be able to buy collision coverage and comprehensive coverage on a rebuilt-title car. Once the car has a salvage title, you'll also need to pay for extensive repairs to register it for road use. But if the insurance check for your totaled vehicle is less than what you owe, you can save yourself and buy gap coverage when you buy a new car.

After a car accident, it's common for your car insurance rates to increase. It may be a good time to shop around for a new car insurance company. Our research shows that customers save an average of $390 annually when switching auto insurers.

If you're in the market for a new car insurance company, see who other drivers rate as the best car insurance companies.

Summary: How to negotiate the best settlement for your totaled car

  1. Know what you are selling to your car insurance company.
  2. Prepare your counter offer.
  3. Determine the comparables (comps) in the area.
  4. Obtain a written settlement offer from the auto insurance company.
  5. Make your counter offer for your totaled car.

Save Money by Comparing Insurance Quotes

Compare Free Insurance Quotes Instantly

ZIP Code must be filled out!

Secured with SHA-256 Encryption


The content on this site is offered only as a public service to the web community and does not constitute solicitation or provision of legal advice. This site should not be used as a substitute for obtaining legal advice from an insurance company or an attorney licensed or authorized to practice in your jurisdiction. You should always consult a suitably qualified attorney regarding any specific legal problem or matter. The comments and opinions expressed on this site are of the individual author and may not reflect the opinions of the insurance company or any individual attorney.

Save Money by Comparing Insurance Quotes
Compare Free Insurance Quotes Instantly
ZIP Code must be filled out!
 Secured with SHA-256 Encryption