Tennessee Total Loss Threshold

Understanding the Tennessee Total Loss Threshold

Being involved in a car crash is a horrifying experience. It brings various possible challenges from physical to financial, with the frustration of whether you can cover the loss caused by the accident.

The situation gets worse when you find out that the insurance company has declared your car a totaled vehicle. It means that your vehicle is so badly damaged that the cost to fix it is too high in comparison to its real value.

Unfortunately, you don’t decide whether it is totaled or not. It is the insurance company that considers your car totaled.

In Tennessee, the state has some specific rules for handling totaled vehicles, known as Total Loss Threshold Tennessee. Every car accident victim must understand this guideline, as it can help them understand their rights and get a deserved fair settlement.

Furthermore, it can help them make a well-informed decision about whether the vehicle will be repaired or replaced.

What is the Total Loss Threshold in Tennessee?

Tennessee Total Loss Threshold is a rule used by the insurance company to determine whether your car should be repaired or deemed a total loss. An insurer does this by checking your vehicle’s repair worth and post-accident value.

As per the rule, if the cost to fix your car is equal to 75% or more of its actual cash value (ACV) before the accident, then it will be considered a total loss.

Accidents such as a single-vehicle collision, crashes due to reckless driving, rollover, or truck accidents can cause severe injuries or damage not only to the occupant but also to the vehicle. It may result in total loss.

How the 75% Rule Works in Tennessee?

In such a scenario, an insurance company uses a formula to find out if your vehicle is a total loss. They determine your car’s pre-accident worth based on factors such as mileage, age, condition, and market value. This is called Actual Cash Value (ACV).

Then they identify the repair cost, including the factors such as parts, labor, or paint that make it roadworthy again.

If the estimated repair cost is more than the actual cash value before damage, it is declared a total loss. Let us break it down through a simple example:

Let’s say your car was worth $10,000 before the accident. 75% of $10,000 will be $7,500. Now, as per the estimate by the repair shop, if the cost to fix your car is equal to or more than $7,500, the insurance company will consider your vehicle totaled.

Tennessee Total Loss Threshold Law - What You Need to Know

If your car is declared a total loss, it means that the insurance company believes that the repair cost will be higher compared to your car’s actual worth. After this happens, you need to understand the next step under the Tennessee Total Loss Threshold Law.

As a vehicle owner, you have two main options:

Accept the Settlement

• After your car is considered a total loss, the insurer will offer you a payout based on its ACV. However, it would not include any deductibles or unpaid premiums.
• You will need to transfer the car’s title to the insurance company.
• After taking ownership, they can apply for a salvage title through the Tennessee Department of Revenue. Then they can sell it for parts or scrap.

Keep the Car

• The second option is to keep the totaled car. It usually happens when you think of fixing and using it.
• You will apply for the salvage title yourself.
• After the repairs, your vehicle will be inspected by the state.
• If it has passed the inspection, then you can apply for a rebuilt title that allows you to drive your car legally on the roads.

Important Paperwork You Should Know About

Whether you opt for owner retention (Keeping the car) or settlement, there will be important paperwork involved. It will be related to vehicle title transfer or applying for a salvage title, or a rebuilt title. Knowing about these formalities can help you avoid details and confusion. You can choose the best option that is good for your situation.

Why It is Crucial to Understand the Total Loss Threshold Tennessee Guidelines

As a vehicle owner, nothing can be more disheartening than looking at the damaged car after a crash. And, above that, if you find out that it is deemed a total loss, it can be more frustrating and confusing.

That is why knowing about Total Loss Threshold Tennessee Laws is crucial to understanding your options and protecting your rights. It can help you make an informed choice about what is good for your situation.

Understanding these rules can help you avoid last-minute surprises during the claim process. You can choose between the titles and decide whether to keep and repair the car or accept the settlement.

It can also help you understand the involved paperwork and make you more confident during the negotiation process. In short, knowing Tennessee Total Loss Threshold guidelines can save you time and money, making the situation less stressful after the accident.

Need Help With a Total Loss Claim in Tennessee?

Navigating a total loss claim can be overwhelming, especially when you are unsure about handling the paperwork or negotiating a fair compensation.

At ADR-Claims, we can offer you expert support at every step of the total loss process. Whether you require legal assistance, insurance claim support, or accurate vehicle appraisals, we are here to help you and take the stress off your shoulders.

Talk with our experts by contacting us today! We can help you make the right decision. Get started by scheduling a free consultation!