Can you repair your car if the insurance company declares it totaled?

Answer 1

Repairing a totaled carYou don't mention whether or not it's your own carrier or the carrier for another at-fault driver (i.e., a driver who struck your car and totaled it).

So, you've got several options:

If it's your insurance, you can certainly keep the car because it is, after all, your property. As a total loss, however, your carrier will remove the full coverage on the vehicle as it no longer has any value except salvage value. After you complete the repairs, your carrier may or may not agree to reinstate the full coverage on the vehicle. This is something you might want to ask them before proceeding.

If it's your carrier, and you have a lien through a bank or a dealership on the vehicle, the total loss can be handled in a couple of ways. One, your carrier might pay off your loan first, and then give you the remaining balance (or, if you owe more on your loan than what the car is worth, they might send all of the money just to the bank). If they do it this way, it's unlikely you'll have enough to complete the repairs. The second method involves your carrier issuing a check with both your name and the name of the bank on it. You'd then have to work with the bank on getting the repairs done (again, this is something you'd need to look into before you proceed, because the bank may refuse to endorse the check and insist that it be applied to the loan since the car is now considered a total loss). Either way, your carrier will still remove the full coverage on the car.

If it's another driver's insurance carrier, you always have the option of just retaining the salvage since, again, it's your property. Like your own carrier, the other insurance will remove a certain percentage of the settlement for the car's salvage value (since you're keeping it, they can do this because even a totaled car has some value). They will then issue you a check and you are free to do whatever you'd like with it. NOTE: Even if you're going through another carrier, if your own insurance is already aware that the car is a total loss, they will still remove the full coverage from the car. See #1 for your options.

You've probably noticed that I keep mentioning how the full coverage will be removed from your car since it's now considered a total loss. If you're working only through another driver's insurance, your carrier won't do this if they're not aware of the accident. But you still need to be very careful before you decide to keep a totaled vehicle and repair it. Why? Because most insurance companies have access to databases that flag vehicles deemed to be total losses. It's also possible that the state you live in requires you to have your car's title branded as "salvage" before you can receive payment for your damages.

So, even if you want to keep your totaled vehicle and get it repaired, be aware that you might be putting a lot of money into a car for which the value has been drastically reduced due to its total loss status. If, for instance, another driver hits you in the future and totals your car again, you might find that you're offered only half the regular value because of your car's status. Logically, this makes sense, given that the typical consumer is much less likely to buy your pre-totaled car when others are available. The total loss status decreases its market value substantially.

The repaired vehicle will always have a salvage-rebuilt title and will always be worth 40 to 60% less than an undamaged counterpart, so if you invest money in it and wreck it again, you have a real loss on our hands.