How Does the Insurance Company Compensate If the Car Is Scrapped?

[MacSarah]

Insurance companies will compensate for the actual value of the car before it was scrapped. This is calculated by subtracting the depreciation amount from the original purchase price of the new car. 1. Depreciation calculation formula: Number of months between the accident date and the initial registration date × Depreciation rate × Original purchase price of the new car. The depreciation rate for passenger cars is 0.6% per month, and for large trucks, it is 1.1% per month. 2. Compensation for accident-related vehicle scrapping: For vehicles damaged in traffic accidents, insurance companies will advocate a 'repair-first' standard. If the vehicle does not meet the scrapping criteria, compensation will be provided according to the terms stipulated in the contract, and the compensation amount will be used for repairs. If the vehicle damage reaches the scrapping standard, meaning the estimated repair cost equals or exceeds the actual value of the vehicle, the insurance company will proceed with scrapping compensation. Therefore, if a car owner believes their car is scrapped, they cannot directly claim scrapping compensation; the assessment results from the evaluation department must be considered.