Total loss is defined by the California Department of Insurance as damage or destruction to real or personal property to such extent that it cannot be rebuilt or repaired to its condition prior to the loss or when it would be cost prohibitive to repair or rebuild in comparison to the value of the property prior to the loss. So California does not require that an insurance company find a car to be a total loss using a certain formula or by finding that the cost to repair the vehicle is a certain percentage of the value of the vehicle.

In CA it is left up to the insurance company to determine when they do not find the cost of repairs (and associated costs such as storage, rental car, etc) economical and thus find a vehicle to be totaled out.

Without a specific state law as a guideline most insurance companies will determine a vehicle to be a total loss when it is between 51 to 80 percent of its actual worth (because of added storage costs, rental car, etc) or basically when the repairs costs are more than the value of the vehicle.

The CA Department of Insurance notes that generally an insurance company will pay the lesser of: the amount necessary to repair the vehicle or the actual cash value (ACV) of the vehicle.

When you are in an accident a qualified adjuster or appraiser usually inspects the vehicle damage first. The adjuster or appraiser then writes an estimate based on the initial inspection. If further damage is found during the repair process, the shop will contact the insurer to get the additional cost of repairs approved. Keep in mind the insurer may send out an adjuster to re-inspect the additional damages. If the damage is relatively minor, the company may instead ask you to submit competitive repair estimates. In California it is your responsibility to sign and authorize the shop to repair your vehicle once you are satisfied with the final estimate and repair facility.

If your car is found to be a total loss you should receive Actual Cash Value (ACV) for it. The CA insurance regulator states that unless otherwise defined in the policy, actual cash value in California means fair market value. The fair market value of an item is the dollar amount that a knowledgeable buyer (under no unusual pressure) is willing to pay, and a knowledgeable seller (under no unusual pressure) is willing to accept.

Under the CA Fair Claims Settlement Practices Regulations insurance companies are required to offer a fair settlement. If you suffered a total loss, settlement must include taxes, license and transfer fees. The settlement must reflect the value of a comparable vehicle of like kind and quality. If you retain the salvage, deductions from the settlement for salvage must be fair, measurable, and discernable

Salvage Value is what you would pay, or normally can be deducted from your ACV settlement amount if there is not a lien holder on the vehicle, if you wanted to keep the car that has been declared a total loss.

Salvage value is the remaining value of your damaged vehicle after it is determined to be a total loss. It is usually determined through bids from salvage buyers. The company may sell the salvage to the highest bidder. However, it is not obligated to do so. If you decide to keep the damaged vehicle, the highest salvage bid may be deducted from your settlement. In effect, you are “buying back” your vehicle for the salvage value. If you retain possession of the salvaged vehicle, it is your responsibility to file a salvage certificate with the CA Department of Motor Vehicles.

If you want to find out how to file a salvage certificate than contact the CA DMV. Also if you are thinking of keeping the car with the salvaged title you should check around for insurance to put on it since it can be difficult to find insurance for cars with branded (salvage or rebuilt) titles typically.

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