Install
Totaled Cars terms
Total-loss math and negotiating the payout.
Actual cash valueWhat a car was worth just before a loss — replacement cost minus depreciation — and the basis of most total-loss payouts.Agreed valueCoverage where you and the insurer set a car's value when the policy is written, and that amount is paid if the car is totaled, with no depreciation.DepreciationThe loss in a car's value over time from age, mileage and wear, which insurers account for when calculating actual cash value.Diminished valueThe resale value a car loses after a crash, even when fully repaired, because buyers pay less for a car with an accident history.LienholderThe bank, credit union or finance company with a legal claim on a financed car until the loan is paid off, usually named on the insurance policy.Loss payeeThe lender or leasing company named on your auto policy to receive claim payments for the car, alone or jointly with you, until the loan is paid off.Owner-retained salvageKeeping your car after the insurer declares it totaled; the payout drops by the car's salvage value and the title is usually branded.Replacement costWhat it would cost to replace damaged property with new property of like kind and quality, with no deduction for depreciation.Salvage titleA branded vehicle title issued after a car is declared a total loss, warning future buyers of serious damage; it must be rebuilt to drive legally.Salvage valueWhat a damaged or totaled car is worth as a wreck, usually the amount an insurer expects to get for it at a salvage auction.Total lossA car so badly damaged that repairs would cost more than it is worth, or more than a state threshold, so the insurer pays its value instead.Total loss thresholdThe point, set by state law or insurer practice, at which a damaged car is declared totaled rather than repaired, often a percentage of its value.