What is “totaling,” and why is it bad?
If you look at your auto insurance contract, you’ll notice a provision that if your car is damaged in an accident, your insurer doesn’t have to pay you more than your auto is worth. If it would cost more to fix the car than a certain percentage of the car’s value, your insurer will consider your car a total loss, i.e., “total” it. All you’ll be able to get is a check for the value of the car. This is bad, because it usually won’t be enough to replace your car, and it won’t be enough to fix it. Plus, if you get back your car and use the money to fix it, insurers may refuse to provide more than basic liability coverage on it.
