Total Loss Claims: Everything You Need to Know

Everything You Need to Know about your Total Loss Claim.

This guide breaks down what a total loss claim is, how insurance companies calculate your payout, and the only proven strategy for fighting a lowball valuation.

Buckle up. This one covers every detail so you don't give away even a penny more than the insurance company deserves.

‍TLDR (To Long Didn't Read):

When your vehicle is severely damaged or declared a total loss, you’re suddenly forced into a confusing and high-stakes process. Most people unknowingly accept the insurance company’s first offer—often a lowball valuation—without realizing they have the right to dispute it and potentially recover thousands more.

At Total Loss Champions, we help drivers challenge unfair valuations, understand their rights, and secure a fair payout.

What Is a Total Loss Vehicle?

A vehicle is considered a total loss when the cost of repairs exceeds a certain percentage of its actual cash value (ACV). Depending on the insurer and the state, this threshold is typically between 70% and 80%.

A vehicle is usually totaled when:

• Repair costs exceed 70–80% of its value
• Damage makes repairs economically unreasonable
• The insurer decides it’s cheaper to pay ACV than repair the car

Your total loss payout is based on your vehicle’s value right before the accident. But insurance companies frequently undervalue cars with biased valuation reports—meaning the number you’re offered is often not the true market value.

How Insurance Companies Calculate Actual Cash Value (ACV)

Insurance companies use third-party valuation tools like CCC One and Mitchell to determine ACV. These systems pull data from dealer listings, auction results, and private-party sales, but they often misrepresent the true market value.

Factors that affect ACV include:

• Age and condition
• Mileage and maintenance history
• Local market pricing
• Trim level, packages, and aftermarket upgrades

Common problems with CCC and Mitchell reports:

• Comparing your car to cheaper out-of-market vehicles
• Applying excessive negative adjustments
• Ignoring premium features or recent repairs
• Selecting inappropriate comparables to suppress value

These systems are built to protect insurance companies—not drivers. If the number seems low, it probably is.

If you think the ACV your insurer offers is too low, you have every right to dispute it. Hiring an independent appraiser can help identify overlooked value and give you leverage during negotiations.

Can You Dispute a Total Loss Valuation?

Yes—and you absolutely should. We find that most total loss ACV offers are severely below market value.

Most online advice (“send your adjuster comparable listings” or “research similar cars”) does not work. Insurance companies almost never accept consumer-submitted comps.

There is only one proven, legally enforceable way to dispute a low total loss ACV offer. Invoke the "Right to Appraisal" (RTA) or "appraisal clause" in your contract.

How to Invoke the "Right to Appraisal" (RTA) or Appraisal Clause?

Read our full guide on the appraisal clause.

There is an appraisal clause in auto insurance policy contracts. It allows you and your insurer to hire independent appraisers to determine the vehicle’s true value. If they can’t agree, an umpire steps in.

The key steps to actually winning a total loss dispute:

1. Invoke your policy's appraisal clause immediately. Don't waste time with comparables
2. Hire an experienced public adjuster who specializes in total loss claims
3. Ensure your appraiser has a track record of fighting for consumers, not insurers
4. Work with a total loss service who can both appraise your vehicle AND negotiate your settlement

Here’s what most people don’t know:

• Many “independent” appraisers work regularly for insurance companies
• Your insurer will pick someone who consistently produces low valuations
• A simple appraisal report is not enough—you need actual negotiation

This is why most consumers lose appraisal disputes. The process is technical and heavily favors the insurer unless you hire the right professional.

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The bottom line: insurance companies have rigged this system in their favor, but the appraisal clause (when used correctly with the right professionals) remains the best way to get what you're actually owed.

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How to Actually Win an Appraisal Clause Dispute

• Invoke the appraisal clause immediately
• Hire an appraiser who works only for consumers
• Choose someone who both appraises and negotiates
• Work with a team experienced specifically in total loss claims

Total Loss Champions handles both the appraisal and the negotiation, giving you the leverage and expertise you need to recover a fair settlement.

Can You Keep a Totaled Vehicle?

Yes—you can keep the vehicle if you want to repair it yourself or use it for parts. But the insurer will deduct the salvage value from your payout, and the car will receive a salvage title.

Pros of keeping a totaled vehicle:

• You can repair it yourself
• You can keep a sentimental vehicle
• Extra time to shop for a replacement

Cons:

• Salvage title lowers resale value
• Insurance coverage may be reduced or denied
• Lower settlement due to salvage deduction

Total Loss vs. Diminished Value

A total loss occurs when the vehicle is beyond economical repair. A diminished value claim applies when the vehicle is repairable but worth less because of accident history.

If you weren’t at fault, a diminished value claim can compensate you for the loss in resale value after repairs.

How Long Does a Total Loss Claim Take?

Total loss claims often take a few weeks to over a month due to:

• Valuation disputes
• Title transfer requirements
• Documentation delays
• Negotiation back-and-forth

Working with an expert service like Total Loss Champions can reduce delays and improve your outcome.

Should You Use Your Own Insurance or the At-Fault Driver’s?

Using Your Own Insurance
• Faster processing
• Less adversarial
• You pay the deductible (may be reimbursed)

Using the At-Fault Party’s Insurance
• No deductible
• Often slower
• Possible disputes over fault

Your choice depends on coverage, timelines, and how quickly you want the process to move.

What If You Owe More Than the Car Is Worth?

If your loan balance is higher than the ACV payout, you’re considered “upside down.”
Gap insurance covers the difference.

Without gap coverage, you must pay the remaining loan balance out of pocket.

Should You Fight Your Total Loss Claim Alone?

You have two choices:

1. Fight the claim on your own
• You negotiate with the adjuster
• Your comps will likely be rejected
• Expect delays and frustration

2. Hire a professional to prove your car’s real value
• Expert appraisal and negotiation
• Accurate, market-based valuations
• Higher chance of a fair settlement

At Total Loss Champions, we advocate for drivers throughout the total loss process—from appraisal to negotiation—to ensure you receive the compensation you deserve.

If the insurance offer feels low, trust your instincts. You are probably right—and you don’t have to fight alone.

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