My car was totaled: Here’s what happened with my insurance


Taylor Milam

Taylor Milam

Blog author Taylor Milam

Taylor Milam is a personal finance writer who recently paid of $14,000 of student loans. She helps millennials with money and spending at The Freedom From Money.

Published July 18, 2017|5 min read

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Updated April 18, 2019: The airbags ejected, my smoothie flew out of my hand and the car filled with smoke. The collision was over in less than a minute, but as I looked around at the resulting damage, including a giant dent in a parked car, I knew we had a long road of paperwork and insurance claims ahead of us. The three of us — myself, my fiance and the other driver — were dazed but uninjured.

This was the first time I had ever been in a serious car accident and I had no idea what to expect. Here’s what happened, how much it cost and how it impacted our car insurance policy rates.

Here are the steps to consider after an accident when it comes to your insurance.

1. Filing a police report

While my fiance worked with the other driver to exchange insurance information, I called the police. The other driver was able to pull to the side of the road, but our car was stranded in the middle of a busy street. The police officer arrived about 10 minutes later, and after writing down the license plate numbers, driver’s licenses and eye witness accounts, he informed us he would need to file a police report because of the amount of damage.

2. Calling the insurance company

My fiance finished talking with the officer and I dialed our insurance company. After telling the agent what happened and relaying the other driver’s information, she told me a tow truck would be there within the next 30 minutes. Because our coverage included roadside assistance, the agent assured me we wouldn’t be responsible for the $500 to $1,000 cost of towing and storing the car. Here's how to figure out if towing is included in your insurance.

3. Getting a rental car

Because we had opted to pay a few dollars extra per month for rental car coverage, the insurance agent informed me we were covered for up to $30 of rental car fees per day (Learn more about rental care coverage here.)

She called the closest rental car company and made sure a rental car was ready for pickup. After swiping our card for a refundable deposit of $100, we drove away in the car that would be ours for the next two weeks for the bargain price of $0.

4. Receiving the call

For the next few days, we anxiously waited to hear if our car was considered totaled, and on the fourth day, we received the call. The appraiser informed us the cost of repairing the damage was greater than the value of the car. In other words, it would make more financial sense for our insurance company to write us a check for the value of the car than it would be for them to pay to have it repaired. After researching car values on Kelley Blue Book and a few other sites, I called him back and agreed to the appraisal. Because we owned the car in full, he told me the check would come in the mail and our $300 deductible would be subtracted from the total.

5. Determining fault

While my fiance and I frantically shopped for a new car, we received a phone call from our insurer and learned that the insurance companies were having a difficult time determining fault. Our insurance representative told us if the two companies couldn’t settle it themselves, the case would go into mediation, a process in which lawyers from both companies argue their case and a mediator makes the final decision. The dispute did end up in meditation and they reached the decision our insurance company hoped for. We weren’t involved in the process at all.

6. Purchasing a new car

While the car insurance companies worked to determine who was at fault, my fiance and I worked to buy a new car. (We have a guide here. We ended up putting the full the settlement toward a 2016 Hyundai Accent. We returned our rental car the next day.

7. The possibility of a court case

As the weeks passed, we began to recover from the stress of the incident. In February 2017, nearly four weeks after the accident, we received a letter in the mail from our insurance company. The other driver had mentioned they might bring the case to small claims court because they were unhappy with the results of the mediation.

We immediately called our insurance company and they explained they were legally obligated to inform us that the other party had mentioned court. If the other driver decided to sue, our insurance company would provide us with representation in court. Feeling better, I tucked the letter away and tried not to worry about it. As it turns out, worry wasn’t necessary — it never went further than the letter.

8. Recieving the new insurance premium

In June 2017, nearly six months after the collision occurred, our insurance premium renewed for the next six months and the surcharge for the accident appeared on our statement: $346.57. In other words, we’re paying an additional $57.76 per month as a result. The surcharge will drop from our premium in three years.

The research and phone calls that resulted from totaling our car were exhausting, but it would have been infinitely harder without our insurance provider there with us every step of the way. It never felt like we were alone in the process. Even though the experience was unpleasant, having our insurance company on our side made it significantly easier.

Looking for affordable car insurance? Policygenius can help you compare prices.

Image: courtneyk

Taylor Milam

Blog author Taylor Milam

Taylor Milam is a personal finance writer who recently paid of $14,000 of student loans. She helps millennials with money and spending at The Freedom From Money.