Yes, an insurance company can force you to total your car because state laws regulate when cars need to be totaled. Your only option is to negotiate with your insurer about the car’s value, as convincing the insurer to adjust the value might affect whether the car has to be totaled according to state law.
Cars are totaled when the cost of repairs exceeds either the vehicle's pre-crash value or a specific total loss threshold established by the state. For instance, in New York, a car is considered totaled if the cost of repairs is more than 75% of the vehicle’s actual cash value (ACV). Total loss threshold laws account for the fact that damage is often more extensive than it first appears.
It’s also important to note that the ACV is not the price you paid for the car. Instead, the ACV is an approximation of the car’s worth just before it was damaged, so it factors in things like depreciation and mileage.
What You Can Do If Your Insurance Company Wants to Total Your Car
Even if you don’t want your insurer to total your car, you can’t argue with your state’s total loss threshold or ask the insurer to use a different system. However, you can argue that your car was worth more than the ACV chosen by the insurer.
Just bear in mind that you cannot simply choose an estimate based on your own opinion. Instead, you need to provide justification for your estimate of the car’s value, such as an independent appraisal, photographs of upgrades or modifications you made to the car, and/or the prices of comparable vehicles for sale in the area.
If the insurer does not agree with your statements regarding the car’s ACV, you can reach out to your state’s insurance regulator for help. You can also seek arbitration or litigation, though legal fees are likely to decrease or even negate any monetary gains that you make.
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