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What is a Totaled Car?

A totaled car is a vehicle that has been deemed too costly to repair by a car insurance company. Totaled cars are vehicles that have been damaged to the extent that it is not economical to repair the vehicle. All totaled cars are damaged, but not all damaged cars are totaled cars. Vehicles with damage not covered by a car insurance claim are damaged cars but they are not totaled cars, even if it costs more to repair them than they are worth.

The definition of a totaled car is very plain. A totaled car is a vehicle that has been “totaled” by the car insurance company when the total loss threshold for repairs is reached or exceeded. Total loss thresholds used by insurance companies to total cars are set by the state in which the vehicle is insured. Totaled cars are always issued a salvage title that may be retained by the insurance company or the vehicle owner, as the owner chooses. This is true regardless of state.

Totaled cars are often called damaged cars, wrecked cars, or junk cars. Totaled cars come in a variety of conditions including exterior damage, interior damage, mechanical damage, or any combination of these. Totaled cars can be any vehicle year, make, or model because most totaled cars would be in running condition if they had not been damaged by a singular event. Many totaled cars are late model cars newer than 10 model years.

Total car insurance losses in 2021 totaled $196.82 billion according to Statista. This is only about 60% of the total value of the car insurance industry, which sits at $330.4 billion in 2023 per International Business Information Systems (IBIS). The cars totaled by insurance companies are processed through the automotive recycling industry, which itself accounts for a total market size of $67 billion according to imarc, another market research firm. Totaled cars also contribute to the used car industry. According to the National Salvage Reporting Program, 3.5 million salvage cars are sold at car auctions each year, and Repair Drive News reported in November 2022 that about 20% of those vehicles are rebuilt and returned to the roads each year.

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    Totaled car definition

    The definition of a totaled car is the same in every state and in every situation. A totaled car is a vehicle that has been totaled by insurance. Totaled cars have incurred enough covered damage that it is deemed too expensive to repair. Insurance companies use the estimates for repairs and the fair market value of the vehicle to determine if the car will be a totaled car. However, the formula for deciding if a vehicle is a totaled car is set by the state and is described in detail below.

    Totaled cars can be any year, make, or model, and are deemed unsafe to drive on the roads due to body damage, mechanical damage, or both. Totaled cars with a salvage title can only be owned and sold as a scrap car, junk car, or salvage car. However, most states allow totaled cars to be repaired and sold with a rebuilt salvage title that allows the owner to register the vehicle after passing rigorous inspections.

    How does a car become a totaled car?

    There are 5 main ways that a car becomes a totaled car.

    Vehicle accidents are the number one cause of totaled cars.

      1. Car accidents are a major problem in the United States, more so than any other country. According to the National Highway Traffic Safety Administration (NHTSA), there are over 5 million passenger vehicle crashes reported annually in the US, and an estimated 10 million unreported crashes each year.

    Vehicle fires are uncommon but result in totaled cars. Vehicle fires can happen for a number of reasons, usually as a result of mechanical failure. According to Statista there were about 174,000 vehicle fires on highways in 2021. In addition, NHTSA reported that 2% of vehicle crashes are caused by mechanical failure and junk cars that should have been removed from the roads.

    Natural disasters result in thousands of totaled cars per event. Natural disasters from wild fires in California to hurricanes in Florida are responsible for many thousands of totaled cars per year. According to Car Fax, there were as many as 350,000 flood damaged cars in Florida and the Carolinas by Hurricane Ian in 2022. Value Penguin reports that tornados cause about $2.5 million per storm, most of which is split between vehicles and homes. Meanwhile, Forbes reported in late 2020 that the exact number of vehicles totaled by wildfires is large but unknowable.

    Everyday weather events also total cars. Totaled cars occur as a result of weather patterns and events. Days-long precipitation and spring runoff lead to flash floods that damage cars when drivers underestimate the depth of water on the road. The states with the most flooding are Texas, Pennsylvania, Louisiana, Florida, and California. Hail storms can also total a vehicle if the hail damage to the body is severe enough to warrant it and are common in Texas, South Dakota, Kansas, Oklahoma, and Nebraska. According to the Rocky Mountain Insurance Information Association, there were about 849,000 hail damage claims in 2020.

    Car thefts result in stripped cars that are totaled cars. According to the National Insurance Crime Bureau (NICB) there were 932,328 cars reported stolen to law enforcement in the United States in 2021. Almost every stolen vehicle will result in a totaled car because they are already stripped for significantly dismantled before it is recovered, or it is not recovered at all. According to Car Fax, only about 20% of stolen cars are reported as recovered, but it is important to note that many stolen cars are abandoned cars that are eventually processed and disposed of by the city in which they were abandoned without completed notification to insurance or vehicle owner.

    Although these are the main ways cars become totaled cars, this does not encompass all of the possibilities. Vehicles damaged for any reason that is covered by either comprehensive car insurance or collision car insurance that exceeds the total loss threshold for that state becomes a totaled car.

    When are damaged cars totaled cars?

    Not all damaged cars are totaled cars. Damaged cars and wrecked cars are only totaled cars when they are processed on a total loss claim by a car insurance company. However, not all damages are covered. There are differences in types of coverage and each policy is unique. There are four types of car insurance coverage that apply to totaled cars.

    Uninsured motorist coverage:

      1. Uninsured motorist coverage is mandatory in addition to liability insurance coverage in most states. Uninsured motorist coverage results in totaled cars when you are in a car accident caused by an uninsured driver. According to Money Geek, there are about 28 million uninsured drivers in the United States.

    Collision coverage: Collision coverage is optional car insurance that pays for damages caused by car accidents where you were at fault, or when you collide with a stationary object like a support beam in a parking garage. Money Geek reports that as many as 26% of drivers do not have collision coverage, which means that their damaged cars are not totaled cars.

    Comprehensive coverage: Comprehensive coverage varies by policy in what it covers. Most of the time comprehensive coverage pays for damages from natural disasters and other incidents, such as a tree limb falling on the car. About 78% of drivers have some form of comprehensive coverage.

    Theft coverage: Theft coverage pays for damages that result from theft. Theft coverage is sometimes included in comprehensive coverage, but many car insurance companies allow you to add on theft coverage as a separate rider without purchasing comprehensive coverage.

    Whether or not damaged cars are totaled cars also depends on the cost of repairs to bring the vehicle back to the condition it was in before the event that damaged it. When the cost of repairs is deemed to be worth more than the value of the vehicle the damaged car is a totaled car. How this is calculated is based on state level total loss thresholds.

    Total loss thresholds by state

    A total loss threshold is how a state requires car insurance companies to calculate whether or not a vehicle is a totaled car based on repair estimates and fair market value. There are two methods for calculating total loss thresholds. The majority of states use the Fair Market Value method (%FMV) in which a percentage of the fair market value is the threshold for repairs. If the repairs are higher than this amount, the vehicle is a totaled car. Each state sets their own FMV percentages.

    There are 28 states that use the %FMV method.

    State %FMV State %FMV
    Oklahoma 60% Nevada 65%
    Colorado 100% Texas 100%
    Florida 80% Missouri 80%
    Oregon 80% Arkansas 70%
    Indiana 70% Iowa 70%
    Minnesota 70% Wisconsin 70%
    Alabama 75% Kansas 75%
    Kentucky 75% Louisiana 75%
    Maryland 75% Michigan 75%
    New Hampshire 75% Nebraska 75%
    New York 75% N. Carolina 75%
    N. Dakota 75% S. Carolina 75%
    Tennessee 75% Virginia 75%
    West Virginia 75% Wyoming 75%

     

    The other method for determining if a damaged car is a totaled car is the Total Loss Formula (TLF). The TLF is calculated by subtracting the salvage value of the vehicle from the fair market value of the vehicle just before the damage occurred. When the cost of repairs are higher than this number the damaged car is a totaled car. The 22 states using the TLF are Alaska, Arizona, California, Connecticut, Delaware, Georgia, Hawaii, Idaho, Illinois, Main, Massachusetts, Ohio, Mississippi, Montana, New Jersey, New Mexico, Pennsylvania, Rhode Island, S. Dakota, Utah, Vermont, and Washington.

    What are common characteristics of totaled cars?

    There are 3 common characteristics of totaled cars.

    Totaled cars are unregistered cars.

      1. Almost all totaled cars are unregistered cars. Totaled cars are issued a salvage title and are not eligible for registration and cannot be driven on public roads or highways. Salvage cars that are rebuilt are totaled cars that can be registered in most states.

    Totaled cars are extensively damaged cars. Regardless of the type of damage, totaled cars are always damaged cars. Totaled cars are totaled when it will cost too much to repair this damage.

    Totaled cars have salvage titles. In all 50 states totaled cars are given a salvage title. The salvage title can be used as an ownership document just like a regular certificate of title, but cannot be registered in any state. When totaled cars are repaired they are given a rebuilt salvage title after undergoing strict safety and emissions inspections.

    Totaled cars can also have additional issues that existed before they were damaged to the point of being totaled by insurance. In these cases totaled cars could also be clunkers, decrepit cars, derelict cars, or beater cars.

    Are totaled cars junk cars?

    Yes, totaled cars are junk cars and are bought by junk car buyers, junkyards, and salvage yards. Most totaled cars have body damage but most of its valuable reusable car parts intact and working. Cars totaled after a natural disaster may still only be good for scrap metal recycling. Totaled cars are junk cars in either case.

    What are other names for totaled cars?

    Other names commonly used for totaled cars include wrecked cars, damaged cars, and salvage cars. Depending on their condition and the circumstances in which the vehicle was totaled, totaled cars can also be called scrap cars, inoperable cars, or end-of-life vehicles. When totaled cars are returned to the roads they may also be called clunkers, beater cars, derelict cars, decrepit cars, or lemon cars. Totaled cars can also be unregistered cars, unwanted cars, or abandoned cars.

    What is a totaled car worth?

    The worth of a totaled car depends on its year, make, model, and condition. Vehicles that have reusable parts that are in-demand by used car parts stores will bring more cash than totaled cars good only as scrap metal recycling.

    It is important to note that location and the market for totaled cars in your area play a large role in how much totaled cars are worth.

    What are the price ranges of totaled cars?

    The price ranges of totaled cars depend on many factors, including the make and model of the vehicle, the vehicle’s condition, what parts are reusable and in-demand, and local scrap metal prices. What are the most valuable parts of totaled cars?

    Totaled cars that have been flooded or burned do not have reusable parts, but most parts also have value as scrap metal. The most valuable and in-demand used car parts from totaled cars are the engine, transmission, and catalytic converter.

    What are the most valuable scrap metals in totaled cars?

    About 65% of a vehicle is recyclable steel and iron alloys, with the majority of this found in the frame, body, engine, and drive train of the vehicle. Aluminum is also in high demand, and most transmissions are made of aluminum with a steel or cast iron casing. Catalytic converters contain small but very valuable amounts of platinum, palladium, and rhodium. Mercury, magnesium, and other metals and elements are also present in totaled cars.

    What to do with a totaled car

    There are 4 things you can do with a totaled car.

    Let the car insurance company keep the totaled car.

      1. If you do not opt to keep the totaled car, the car insurance company will pay you fair market value for the vehicle as it existed on the day before the covered event and dispose of the totaled car for you.

    Keep the totaled car and rebuild it. Most states allow totaled cars to be repaired and retitled as a rebuilt salvage car. If you live in a state with a low total loss threshold and you have sentimental ties to the vehicle, it may make sense to retain the totaled car and pay for the necessary repairs.

    Keep the totaled car and donate it to a charity. Some charities accept totaled car donations when they have a resource for rebuilding and reselling these vehicles. Whether or not the charity will accept the totaled car depends on the extent of the damage and how the charity will dispose of the vehicle. Most of the time it is best to dispose of the totaled car and give the charity a percentage of the insurance payout instead.

    Retain the totaled car to sell it to a junk car buyer. In all 50 states you have the right to retain your salvage vehicle and sell it yourself by finding a buyer at the best price. When you keep the totaled car the insurance company will deduct the fair market salvage value of the vehicle from your paid insurance claim. This amount could be higher or lower than the actual price of the totaled car in your area depending on local demand for the vehicle and its recyclable materials.

    One should always get local free junk car quotes for totaled cars before deciding whether to retain the vehicle or allow the insurance company to dispose of it. Getting quotes from junk car buyers like Junk Car Medics gives you something to compare to the offer from the insurance company. This way you can take the option that brings you the most financial benefit.

    Can I sell a totaled car with no title?

    No, you cannot sell a totaled car with no title. Every totaled car is given a salvage title. The salvage title must be in your name to sell the totaled car. If the salvage title is in your name but has been lost or destroyed, most states require you to complete an application for duplicate salvage title. If you lose the title before you apply for a new salvage title in your name, you will have to contact the insurance company to obtain the duplicate salvage title.

    Can I sell a totaled car with no registration?

    Yes, you can sell a totaled car with no registration. Most totaled cars cannot be registered. However, a previous registration can be used to prove ownership when getting duplicate salvage title from your local DMV.

    Who buys totaled cars?

    There are 3 main places who buys totaled cars.

    Local junkyards and auto salvage yards.

      1. Most totaled cars have extensive body damage but few if any mechanical problems. For this reason junkyards and auto salvage yards are happy to buy totaled cars so that they can sell the salvageable used parts. Some salvage yards may also buy the totaled car so that they can repair it and sell it as a rebuilt salvage vehicle. Used car parts stores also thrive on parts from totaled cars, but they do not usually buy totaled cars from the general public.

    Local junk car buyers pay cash for totaled cars. Junk car buyers operating locally will be able to give you the most cash for totaled cars. Junk Car Medics is a junk car buyer with locations in all 50 states to process totaled cars near you. Junk car buyers then pass the totaled car on to junkyards, salvage yards, auto dismantlers, vehicle recyclers, mechanics, and used car parts stores in your area.

    Local mechanics buy totaled cars. Totaled cars that could be repaired are sometimes in demand by local mechanics. If you know a mechanic that rebuilds and sells salvage cars, getting a quote from them for your totaled car will give you an idea of whether or not this option brings more cash for your totaled car.

    The easiest way to sell a totaled car is to choose a junk car buyer like Junk Car Medics. Junk Car Medics makes sure your totaled car goes to the right buyers for the right price to pay more cash for totaled cars near you.

    How to choose a junk car buyer

    The amount you get for your totaled car and the experience you have in selling it depend on finding the right junk car buyer. Here are 4 ways to choose a junk car buyer.

    Research the reputation of junk car buyers.

      1. The first place to start is with the reputation of junk car buyers. Make sure that the junk car buyer you choose is locally licensed and operates according to state and federal laws about buying and selling totaled cars. You can check the reputation of junk car buyers by looking at online reviews and consumer watchdog sites like the Better Business Bureau. Junk Car Medics has an A+ rating with the BBB and thousands of positive online reviews with Google, Yelp, and Trust Pilot.

    Compare junk car quotes. Get quotes for your totaled car from multiple junk car buyers to compare prices. The process of getting junk car quotes will also acquaint you with the customer service provided by the junk car buyer. Junk car quotes should be free, fast, and guaranteed for a specific amount of time. Junk Car Medics provides free quotes for totaled cars in your area online or by phone and gives instant cash offers and guarantees them for 7 days.

    Confirm junk car removal details. When getting quotes from junk car buyers make sure that you also confirm how and when the totaled car will be towed. Junk car buyers paying cash for totaled cars should offer free junk car removal. The cost of towing is calculated into the price paid for the totaled car. Never pay for removal or towing of totaled cars sold to junk car buyers. Junk Car Medics uses the best local towing companies to remove totaled cars to keep removal costs low so that we can pay more for totaled cars.

    Look for experienced junk car buyers. The most experienced junk car buyers are able to help with every step of the process to sell your totaled car, including the paperwork necessary when the salvage title is missing. Experienced junk car buyers will also have a larger network of people who want totaled cars. Junk Car Medics is able to give the best prices for totaled cars because our network consists of all of the entities and private buyers that may be interested in your vehicle. Junk Car Medics also provides all paperwork to sell totaled cars with no title along with instructions for completing the salvage title transfer.

    Junk Car Medics is the best junk car buyer overall with our quick, easy, painless, and rewarding process for selling totaled cars. When retaining a totaled vehicle to turn a profit, Junk Car Medics is able to give the best prices for totaled cars.

     

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