Total Loss
When an accident causes extensive or costly damage to your vehicle, it's possible that we'll declare your vehicle a total loss.
The total loss vehicle claim procedure takes our business experience, customer expectations and state laws and regulations into account, so the process is as fast and easy as possible. If your vehicle qualifies for a total loss, our claims representatives will manage the process for you, as well as answer any questions you may have.
What is a total loss vehicle claim?
In general, your vehicle will be declared a total loss when the cost to return it to pre-accident condition would be as much, or more, than the actual cash value of the car. For more information, see the examples below.
Actual Cash Value vs. Repair Costs
|
| Your vehicle’s actual cash value: | $10,000 |
| Cost to repair: | $3,000 |
| Difference: | $7,000 |
|
| Your vehicle’s actual cash value: | $3,000 |
| Cost to repair: | $4,000 |
| Difference: | $1,000 |
Your vehicle may also be declared a total loss when the repair cost, plus the salvage
value (money recouped when your vehicle is sold through a licensed salvage vendor)
exceeds the vehicle's actual cash value, or if required by state laws or regulations.
(What is salvage?)
|
| Your vehicle’s actual cash value: | $7,000 |
| Cost to repair to pre-loss conditions: | $6,800 |
| Salvage value: | $700 |
| Cost to repair + salvage value: | $7,500 |
Another reason your vehicle may be declared a total loss is if it cannot be safely or physically repaired to its pre-accident condition.
What happens if my vehicle is declared a total loss?
If your car is declared a total loss, we do not pay to repair it. Instead, you will receive a payment based on the actual cash value of the vehicle. In exchange, you will sign over the title to your vehicle to us, unless you choose to retain salvage and this is permitted by state law (see “May I Keep My Salvage Vehicle” for more information). Depending on the individual situation, payment for the vehicle will be made to the owner, the lienholder(s), or both. Then we will sell your damaged vehicle as salvage through a licensed salvage dealer. If you receive a total loss payment, you may use the money for any purpose, including purchasing a new vehicle.
How much will you pay me for a vehicle declared a total loss?
You'll receive what is known as the actual cash value* (ACV) of your vehicle. The actual cash value is the market value of the vehicle taking into consideration pre-loss condition, options and mileage.
To determine what you'll receive for a total loss, we do what many consumers do to determine how much a car is worth. And to some extent, this procedure is governed by state statutes and regulations. In general, however, this is our process:
First, we will determine your vehicle's market value. This usually includes looking at guidebooks, obtaining quotes from dealers and reviewing online and newspaper ads to gather information about the market value of vehicle models similar to yours. Adjustments may be made to account for differences in mileage and accessories. This information gives us a starting point.
The next step consists of assessing the condition of your car prior to the accident. Cracked windows, dented, scraped or rusted parts, and other excessive wear and tear or damage, such as a badly stained interior, will decrease its value.
To calculate the actual cash value of your vehicle, subtract the value of prior damage and excessive wear and tear from your vehicle’s market value. Then subtract the amount of your collision or comprehensive deductible (if you are insured with us, this is the deductible you selected when you purchased your auto insurance policy). The result is the amount you receive for a total loss. For more information, see the example below.
*For Progressive Commercial Auto and select auto insurance policies, Progressive will pay either the actual cash value or the stated amount of the vehicle, whichever is less.
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| Your vehicle’s actual cash value: | $15,000 |
| Your deductible: | $500 |
| Payment for your total loss: | $14,500 |
Will I still owe money on my loan or lease?
If your vehicle is declared a total loss, it's possible that you may still owe money on your loan or lease. This situation occurs when the actual cash value of your vehicle is less than what you owe.
To prevent this situation, you may want to consider adding Loan/Lease Payoff coverage to your Progressive Insurance policy. This coverage can provide some financial security for you in case your vehicle is declared a total loss. Loan/Lease Payoff coverage, commonly referred to as "gap" coverage, may pay the difference between the actual cash value of your vehicle and what you still owe on your loan or lease, minus your Comprehensive or Collision deductible. However, the payment made under this coverage may not exceed 25 percent of the actual cash value. Of course, the coverage must be added to your policy prior to any accident in order to be utilized.
What if I disagree with the total loss value?
If you disagree with the total loss value determined, you will be asked to provide documentation that backs up the reason for your disagreement. We will review the documentation for accuracy and applicability to the total loss vehicle, and your offer may be adjusted. If there is still disagreement, your Progressive Insurance policy contract describes how an appraisal can be arranged to resolve any differences.
Is there a pre-determined threshold to determine total loss?
No, we do not use a pre-determined threshold to determine total loss, such as when the cost to repair a vehicle reaches a certain percentage of the actual cash value — except in states that mandate or set specific thresholds.
What happens to my vehicle when it's declared a total loss?
Generally, your vehicle is sold at a salvage auction or to a licensed salvage vendor unless you decide to keep your vehicle and doing so is permitted by state law.
In all cases, we comply with the appropriate laws or regulations that require obtaining salvage titles or branding/marking the title. When we obtain salvage at the conclusion of a total loss settlement, we sell it through licensed salvage vendors. We do not directly sell vehicles determined to be a total loss to private individuals.
May I keep my salvage vehicle?
In some cases, you may be able to keep your vehicle after it's declared a total loss. In these cases, we deduct the amount we would have reasonably expected to obtain for the salvage. However, your vehicle may need to be re-titled to indicate that it's salvage depending on the law in your state.
If you retain salvage in a state requiring reporting and/or re-titling of owner retained salvage, you will need to comply with these requirements. Depending on state laws, the vehicle owner or the insurance company may be required to change the title to a salvage title.
Check with your Claim Representative if you are interested in keeping your vehicle.
Please Note: Some services described above are only available to customers who purchased coverages such as Comprehensive, Collision, Rental Reimbursement, Medical Payments, etc., before their loss. Coverage is subject to the terms of your policy. Please refer to your insurance policy to verify which coverages you have.
*For Progressive Commercial Auto and select auto insurance policies, Progressive will pay either the actual cash value or the stated amount of the vehicle, whichever is less.