Your car is a major part of your life, and you do everything you can to protect it. Auto insurance is part of that protection, especially when an accident happens. But sometimes, insurance doesn’t repair your car and totals it instead. At Foresee General Insurance Agency Inc. in Harrison, AR, we’re here to help you understand what happens when an insurance company totals your car and why. 

Why an Insurance Company Totals a Car After an Accident

Sometimes the value of your car is too low, and the cost of repairs is too high. Most insurers total a car if the cost of repairs is more than 80% of the vehicle’s value. Another reason a car might get totaled with minor damage is that the parts are too expensive to replace.

What Happens to Your Car When It’s Been Totaled?

The insurance company takes your car and sends it to auction to recover some of its value. If your insurance policy covers it, you’ll get an amount known as the actual cash value of your current car to use toward buying a replacement. 

If you still owe money on your original vehicle, you’ll have to pay off the remaining balance with the insurance funds. Once the old debt has been settled, you can shop for a new car and use the remaining balance toward its purchase. 

Call Us To Protect Your Vehicle With the Right Auto Insurance Policy

At Foresee General Insurance Agency Inc., we want to make sure you’re as safe as possible when you’re driving around Harrison, AR. Call us to talk about getting the right auto insurance for your car. We’re here to make sure you have a policy that helps you replace your car if it’s been totaled after an accident.