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How do car insurance companies know when to total out a flood damaged car?


Question: How do you know when to total a car from flood damage?

Answer:  How a vehicle is determined to be a total loss from an auto accident, or flood, varies according to your state's laws as well as your car insurance company's guidelines.

In general a car is determined to be a total loss when:

  • It's so severely damaged it cannot be safely repaired;
  • It costs more than the worth of the vehicle to repair it; or
  • The amount of damage or cost of repairing the vehicle is too much according to state regulations or the insurer's guidelines for total loss.

If you made a comprehensive auto insurance claim for a car that was in a flood, it would certainly be totaled out by your car insurance company if mechanics say it's not repairable due to the extensive damage it received, or if the cost of repairing it is the same or more as the actual cash value (ACV) of the vehicle.

If instead a mechanic says the car is repairable, and the costs are under 50% the vehicle's ACV, then it will likely not be totaled out and instead fixed.

Once the damage to the vehicle reaches 50% or more, than it's up to the insurance company (abiding by state regulations) to determine if it will be totaled or not, based on the adjuster's assessment of the vehicle.

A flood damaged car can be tricky for insurance adjusters, and mechanics, to determine the extent of the damages it received. It may first appear to be minimal, but once repairs are started it may end up being declared a total loss due to extensive electrical damage, mold or other issues that are uncovered.

Unless your state has spelled out specific rules for totaling out a flood car, which most don't, it's left up to the guidelines of your car insurance company. For this reason, if your car were in a flood you would need to speak to your auto insurance provider about how they determine a flood car a total loss.

You can ask your insurer if the car were submerged to a certain degree underwater if they would automatically total it out or not. You can also ask what will happen if your car is repaired, but later rust or mold appears, what rights you have, under your policy, to make a supplemental claim for these issues.

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