Depending on the terms and coverage limits of your insurance policy, the following components may be included when determining the ACV of your totaled car:
a) Vehicle's Market Value: This is the amount a similar car of the same make, model, year, and condition would sell for in your local market.
b) Depreciation: Insurance companies account for depreciation, which refers to the reduction in the value of a car over time due to wear, tear, and aging.
c) Salvage Value: If the insurance company believes the totaled vehicle can be sold or used for parts, they may deduct the estimated salvage value from the ACV.
d) Deductible: Your deductible, if applicable, will be subtracted from the ACV to determine the final settlement amount you receive from your insurance company.
e) Options and Upgrades: If your totaled car had any special options or upgrades, such as a sound system or custom wheels, the insurance company might consider these additions in the valuation.
It's important to note that different insurance companies may have varying methodologies and criteria for calculating ACV. Additionally, coverage options, such as agreed value or replacement cost, might influence the amount you receive. You can consult your insurance policy and review your coverage limits to fully understand how your insurance company determines the payment in case of a totaled vehicle.
