May 7, 2012

What Drivers Should Know About Total Loss Claims

The law requires all drivers to carry auto insurance in Connecticut. It is necessary protection for the family. Car insurance companies vary slightly on pricing, but all offer the coverage required by law and the finance companies. Most finance companies require comprehensive collision insurance to protect their investment. Collisions happen to the best drivers. It only takes a one second distraction for a driver to lose control.

A total loss claim occurs when the cost of repairs exceeds the value of the car. For example: If the value of the auto is $1,000.00, and the cost of repairs is estimated at $1,200.00 then the car is "totaled". The insurance will cover only actual market value of the car plus Connecticut sales tax. Your policy will obligate you to transfer title to the insurance company and they will keep the car. The insurance carrier will provide you with information about salvage companies and where they'll sell your vehicle and then give you all the necessary paperwork. Your agent will be glad to sit down with you to explain the process.

You can determine the value of your car by referring to the NADA Used Car Guide plus one other source from the automobile industry that has been approved by the Connecticut Insurance Commissioner.

If you decide to keep the vehicle instead of selling it for market value, the insurance company will take the market, or retail, value at the time of the collision minus the salvage value to determine the amount they will pay for the loss. Since you're keeping the totaled vehicle you assume responsibility for all repairs and the Department of Motor Vehicles will stamp your title as "salvage". You'll have to get your car re-inspected before the Department of Motor Vehicles will allow it back on the road after it's repaired. The state considers the vehicle as "salvage" even if you get the repairs done at a shop for less than the estimates that you submitted to the insurance company.

A finding of fault on the part of the other driver for the accident by the state would entitle you to compensation for the loss of your car. You will also receive reimbursement for a rental vehicle for a reasonable length of time, even if you opt not to rent a replacement automobile. If you have rental reimbursement coverage on your policy, it is a good idea to check with your agent about your car rental options.

Auto insurance in Connecticut is important for not only the driver but also his or her family. Car insurance is vital protection when you have been in an accident.