Total Vehicle Loss and What Insurance Owes you

When your car is totaled and you submit a claim to your insurer so you can quickly purchase a replacement vehicle, your insurer enters what is called a total loss car insurance settlement.

The purpose of this settlement is to reimburse you for your vehicle’s replacement cost.

However, there are cases when your insurance will fail to reimburse you for included fees such as:

  • Sales tax
  • Vehicle registration fees
  • Title transfer fees
  • License plate transfer fees
  • Other mandatory fees required by the state

What Happens When Your Insurance Totals Your Car?

A car is considered totaled when the cost of repair outweighs or comes within a certain percentage of its actual value (before the accident occurred).

Instead of paying for repairs, your insurance company will ‘total’ the vehicle and reimburse you its replacement cost.

Calculating Your Totaled Car Value

The replacement cost or Actual Cash Value (ACV) of a vehicle is often determined by factors such as:

  • Make, model, and year of the car
  • The condition of the vehicle
  • Mileage
  • Resale value comparisons

If the repair costs meet a certain percentage threshold based on these factors, the vehicle may be considered a loss.

The threshold percentage that determines if a vehicle is totaled varies by State.

In some states, such as Illinois, insurance companies use a Total Loss Formula that will include factors such as the salvage value of the vehicle.


Get the Most from Your Total Loss Car Insurance Settlement

Courts have found that a car’s replacement cost includes such items as sales tax, vehicle registration fees, and other mandatory fees that are required to be paid by state or local law.

Title transfer, license plate transfer fees, and sales taxes have also been held to be mandatory fees included in the replacement costs of a total loss vehicle.

Your insurer may not be paying you the correct amount for your total car loss settlement if they have not paid the correct amount of or omitted to pay sales tax, title, and/or transfer fees.

Contact Us About Your Total Loss Vehicle Settlement

If you have sustained a total vehicle loss, we would be happy to review your settlement documents, your insurance policy, and the invoice for your replacement vehicle to determine if you are owed additional money.

If you are interested in a free consultation to explore whether you have a claim and may be entitled to a refund, please call us at 888-505-0953 or email us at

Anderson + Wanca works with attorneys licensed throughout the United States.

Total Vehicle Loss