What Does Total Loss Vehicle Mean?

[OKayden]

Total loss vehicle refers to an insured vehicle that is completely destroyed or severely damaged, where the repair costs exceed the vehicle's actual value at the time. The calculation formula for a total loss vehicle is as follows: If the insurance amount is higher than the actual value at the time of the accident: Actual compensation = (Actual value at the time of the accident - Residual value) * (1 - Deductible rate). If the insurance amount is equal to or lower than the actual value at the time of the accident: Actual compensation = (Insurance amount - Residual value) * (1 - Deductible rate). Information about total loss vehicles is as follows: When repair costs exceed the vehicle's actual value at the time, the vehicle still has some value. Therefore, repair shops can purchase the vehicle, repair it themselves, and then sell it in the used car market. Total loss vehicles can be traded after approval from the insurance company. The disposal method for total loss vehicles can include auctions. Most repaired total loss vehicles end up in the used car market.