Mar 9th, 2023
Paulozzi Joseph

Your car has just been in an accident and has extensive damage.  But does that automatically mean it has been totalled?  The best way to determine whether or not your car is totalled is to get several repair estimates and then compare those amounts with how much it would cost to replace your vehicle.  If repairs cost more than a similar replacement car, it is probably totalled. Read on to learn when you might want to file an insurance claim for a total loss in Ohio.

What is a “Total Loss” Insurance Claim in Ohio?

A “total loss” insurance claim in Ohio occurs when you file a claim after an accident that would require you (or the insurance company) to pay more to repair the vehicle than it would cost to replace it.  Just because your vehicle is damaged, that does not mean it would qualify as a “total loss,” and insurance companies must follow state laws when determining whether your vehicle meets the definition of a “total loss.”

The Definition of a Total Loss Vehicle According to Ohio Law

So, what is a “total loss vehicle?”  In the state of Ohio, a “total loss vehicle” for insurance purposes is when the cost to repair the vehicle is more than what it would cost to replace it.  The cost to replace the vehicle is based solely on the actual cash value, and is not tied to a set dollar amount to replace or repair the vehicle.  It is not the same thing as the cost to buy a new (current model year) vehicle, either.

Actual Cash Value

Actual cash value refers to what you would have been paid if you sold the car prior to the accident, not the price you paid when it was new or when you bought it.  Actual cash value does not include any amount you may owe on a car loan, and Ohio insurance companies are not required to add that expense into their calculations of the actual cash value for your vehicle.  

Cost of Repair

“Cost of repair” is exactly what it sounds like:  how much it would cost for you to have the totalled car repaired by a local body shop or mechanic.  This is only to restore the vehicle to the state it was in prior to the accident, and does not include any upgrades you may wish to have done to the vehicle.

Salvage Value

Salvage value means how much the metals, undamaged parts, and other reusable materials in the vehicle are worth.  This value is typically significantly lower than the actual cash value of the car before it was in the accident.  Ohio insurance companies are not required to consider this value when determining cash offer amounts or vehicle replacement costs.

What is the Ohio total loss threshold?

The Ohio total loss threshold is based on the actual cash value of your vehicle, and is not set at a certain percentage or dollar amount. That means the total loss threshold for your vehicle might be different than the total loss threshold for someone else’s vehicle, and is determined by several factors, including the vehicle’s age, condition, mileage, and any upgrades or special features it may have.

What Happens If Your Car is Deemed a Total Loss

In Ohio, insurance companies have the option to replace your vehicle with one that is comparable to yours or to offer you a cash settlement based on the car’s actual cash value, but they must follow strict guidelines regardless of which option is chosen.  Typically, Ohio insurance companies choose to offer a cash settlement for total loss claims.

How Is Total Car Loss Value Calculated?

If the insurance company chooses to give you a cash settlement instead of replacing your vehicle, they must determine the total car loss value by calculating your car’s actual cash value.  This can be done though one of the following methods:

  • Taking the average cost of at least two similar vehicles for sale or sold within the last 90 days in your area.  The cars must be similar to yours in:  model, year, condition of the vehicle, and make.
  • Taking the average estimate from two or more area dealers if actual vehicles were not available for sale within the past 90 days in your area.
  • Or, using a service like Kelly Blue Book, J.D. Power, NADA, or another organization that can provide accurate vehicle prices for your local car buying marketplace.

It is possible that you could owe more on your vehicle than the actual cash value.  In that case, an Ohio insurance company is not required to offer a cash settlement amount equal to the amount you owe. 

How Is a Replacement Car Selected?

If an Ohio insurance company offers to replace your vehicle, it must:

  • Offer a vehicle that is the same make and year (or newer)
  • Ensure the replacement vehicle has similar mileage and features
  • Be in the same condition (or better) as your vehicle was before it was totalled
  • Ensure the vehicle doesn’t have any unpaid tax liability or transfer fees
  • Make the replacement vehicle available to be inspected

Do You Pay a Deductible When Your Car is Considered Totalled?

Yes, you will still pay the deductible when your car is considered totalled in Ohio.  It will be deducted from the cash settlement amount or be included in the repair estimate for your vehicle.

How Much Does Insurance Pay in Ohio When Your Car Is Totalled?

Insurance companies in Ohio are only required to pay the actual cash value or the cost to replace your vehicle.   (The cost to replace your vehicle may be less than the actual cash value, depending on the inventory available in your area.)  Ohio insurance companies are not required to pay more than your car’s actual cash value, or to pay what it would cost to buy a brand-new (current model year) vehicle.  They are also not required to give you an amount that would pay off any remaining car loans you may have on the vehicle.

How to Know if You Should File for a Total Loss Claim

You should file a total loss claim when it becomes clear that your car’s repair bill will cost you more than it would cost you to replace your vehicle.  You may need to get several repair estimates and compare prices of similar cars in your area to determine if your vehicle will cost more to repair than it would to replace.  When comparing the costs of replacement cars, keep in mind that you are only looking at cars with similar wear and tear, mileage, and the same make and model, if possible.  You are not looking at the cost to buy a brand-new car or a vehicle that is an upgrade from the one that was totalled.

It should be noted that the salvage value of your vehicle is not used in the state of Ohio to determine whether your car is a “total loss” or not.

Is it worth hiring a lawyer for a total car accident?

Yes, it is worth hiring a lawyer for a total car accident, because an experienced law firm can help protect and safeguard your rights if you have a dispute with an Ohio insurance company or other driver(s), and to ensure you are offered a fair cash settlement offer or appropriate replacement vehicle.

Get in Touch With Paulozzi LPA to Help With Your Total Loss Claim in Ohio

Dealing with the aftermath of a car accident is complicated and causes tons of headaches for all parties involved. If your car has suffered significant damage, you might find yourself wondering if it is totalled and what that means for your insurance. By working with an attorney experienced with total loss claims and skilled at working with insurance companies, you can avoid the drawn out, confusing experience all together. If your car has been badly damaged from a car accident, get in touch with our team at Paulozzi LPA today to help with your total loss claim.

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