Understanding Total Loss Evaluation After a Car Accident in Orlando

A vehicle is deemed a “total loss” when an insurer decides it is beyond repair. However, this is only the start of the claims process. At JustCallMoe, our Orlando car accident lawyer provides an overview of total loss evaluation and encourages you to contact us if you have questions. Most loss evaluation is straightforward, but some issues can arise.

Florida Total Loss Value Guidelines

A vehicle is deemed a total loss when the repair costs exceed a certain percentage of the vehicle’s actual cash value. At that point, the vehicle is too expensive to fix, and the insurance company will consider it totaled. They should pay you for the value of the vehicle so you can buy a new one.

Under Florida total loss guidelines (Florida Statutes § 319.30(3)(a)(1), a vehicle is a “total loss” in one of two situations:

1. The insurance company pays the owner to replace the damaged vehicle with a similar one, or
2. An uninsured vehicle is damaged, and the cost of repairs is 80% or more of the cost of replacing the vehicle with a similar one.

A vehicle is not a total loss where the owner and the insurance company agree to repair the vehicle.

How Much Was Your Vehicle Worth?

This is a critical number in the total loss evaluation. Your insurance company wants to figure out the value of the vehicle right before the accident. This is not the value you necessarily paid when you bought the vehicle, nor is it the value of the vehicle when new.

For example, you might drive a 2018 Toyota Corolla. The insurer will not value the vehicle as new. Instead, the ACV will account for the depreciated state of the vehicle and should be based on various factors:

• Age
• Mileage
• Condition

Under Florida Statutes § 626.9743, an insurer will base actual cash value on Kelley Blue Book or a similar electronic database, or from the sale of at least two comparable motor vehicles in the area within the past 90 days. An insurer can also use two or more quotes from at least two licensed dealers in the market area. The value should also include applicable sales tax.

Was Your Vehicle Totaled?

Suppose your 2018 Corolla had an Actual Cash Value of $13,000. The cost of repairs is $11,000. In this case, the vehicle is considered “totaled” under Florida law.

However, the same uninsured vehicle might require only $6,000 in repairs. In that case, the vehicle is not considered totaled.

An Insurer’s Duties to Their Insured

Insurance companies are regulated by the state of Florida. They have various obligations under the law, including a duty to act promptly on a claim. The Florida Insurance code typically requires an investigation within 30 days of receipt of a claim. You should not be waiting around indefinitely to hear from an insurance company.

An insurance company should also provide a notice that details the appraisal process, including the calculation of the Actual Cash Value.

This notice should also explain your right to dispute any valuation.

Disputes Involving Total Loss Evaluation

Many disputes arise regarding total loss valuation. For example, you might believe the insurance company has undervalued your vehicle and considered it a total loss even though you believe it can be repaired. In other situations, an insured might believe a vehicle has been totaled, but the insurer minimizes the cost of repairs.

Insurance companies have a duty to act in good faith with their insureds whenever handling a claim. This means they cannot misrepresent the policy, lie to you, or drag their feet. If they commit insurance “bad faith,” then an insured can usually sue for compensation. An insured can seek compensation above and beyond their policy limits in certain situations.

An insurance dispute might also be settled with arbitration. This is a method of resolving disputes which does not involve the courts.

Arbitration is often viewed as a faster way to resolve legal disputes, and your insurance agreement might provide for arbitration.

Are You Unhappy with the Valuation?

You might want to contest the total loss valuation, which is your right under Florida law. You should look for the following supporting evidence:

• Proof of the vehicle’s pre-accident condition. Nobody knew the state of your vehicle before the accident like you did. Look to document the condition, including maintenance records and proof of any upgrades or modifications. For example, you might have installed new tires and had a new windshield installed in the vehicle. Those modifications can increase the value of the vehicle.
• Comparable local market prices. Are cars like yours selling for more than the insurance company claims? That fact could boost the value of your vehicle. Or possibly local sales are much lower than the ACV assigned to your vehicle.
• Second valuation. You can seek a second opinion on the vehicle’s ACV. You might schedule an appointment with an independent appraiser and use their opinion in negotiations.

Another consideration is the cost of repairs. Some insurance companies insist that all repairs happen within a network of body shops. In this way, they can control the amount spent on repairs, which you might think is insufficient. For example, they might use Bondo to patch a vehicle, instead of welding pieces together. They save money, but your vehicle is worth much less.

Speak with an Orlando Car Accident Lawyer

Total loss evaluation is a confusing area of law, but a lot rides on whether an insurance company is prepared to pay out for a total loss.

Any car owner who is unhappy with the total loss evaluation should consider whether to challenge or seek an independent appraisal.

Contact an experienced attorney at JustCallMoe if you have any questions about the claims process after a collision. We have helped those with bad faith insurance claims get the compensation they deserve. We can also help anyone who has suffered bodily injuries seek financial compensation for medical care, lost wages, and pain and suffering, among other losses. Our consultations are free and without any risk to you.