Definition:Likely under ill-fated circumstances, every now and then a vehicle is damaged beyond repair. A total loss refers to a vehicle that has significant physical damage or is stolen. Usually a vehicle is a total loss if:
- The vehicle is stolen
- Damage to the vehicle is so severe that it can't be repaired safely
- The repairs will be more expensive than the value of the vehicle itself
- The amount of damage is severe enough that state regulations require the vehicle to be declared a total loss.
Examples:
An elderly man with a twelve year old camper is carrying comprehensive coverage on his RV insurance policy. A deer runs into the side of his camper while driving down the highway. The estimate to repair his camper is $4,000 but the actual cash value of his camper is also $4,000. His RV will be declared a total loss and the actual cash value will be paid minus his deductible.
