crash test, collision, rear-end collision-1620591.jpg

Car insurance guide to what happens to the license plates when a car is totaled. 

Car insurance guide to what happens to the license plates when a car is totaled. 

Following a car accident in which your car is damaged, your car insurance company usually follows 2 paths. The insurance company might cut you a check to reimburse your car repair costs or decide your car is totaled.

Your car will be totaled if the cost to repair your car exceeds its current market value. For example, if the insurance company estimates that your $3,000 worth of car needs $4,000 as its repair costs, your car will be declared a total loss or be totaled. 

In some states, the insurance company will declare your car totaled if the repair costs exceed at least 70-75% of its current market value. But, what happens to your car if it is totaled? who receives a check? what if your car is still drivable? how about its registration?

To understand what happens to license plates when your car is totaled, go through the contents below and make sure you read the whole article.

Page Contents

What happens when your car is totaled?

Your car is totaled only if the insurance company declares it unrepairable. This means that your car is not safe to drive after a repair, for instance, damages to your car frame will most likely result in totaling your car. 

Once your insurance company declares your car totaled, the insurance company will determine and pay you the current market value of your car, minus any deductible.

If you filed a claim through comprehensive or collision car insurance policies, the insurance company will deduct a deductible from your check. This is because you are required to pay that deductible from your own pockets before insurance pays the rest of the coverage.

For example, If the current market value of your car is $5,000 but you chose a $1,000 deductible. You will only receive $4,000 for your totaled car.

personal injury settlement
Photo by on

Who gets the insurance check when a car is totaled?

who gets the check after your car is totaled depends on many circumstances. For instance:

  • You will receive the insurance payout check if you own the car.
  • If you financed your car, the bank or the company that gave you a car loan receives the check.
  • If you leased the totaled car, the company that rents you the car receives the insurance check.

What to do when your car is totaled and you still owe money?

What you should remember is that if you leased or financed your car, its current market value may not be equivalent to the amount of money you still owe on the car. In that case, you will pay the difference from your own pockets unless you bought gap insurance.

Here is an example. Suppose you leased or are financing a $20,000 car. Assume your car gets involved in a car accident but your car insurance determines its current market value is $15,000. Gap insurance will help you by paying the difference of $5,000.

So in short, if your car is totaled and you still owe money on it, you either pay the difference between its current market value and what you still owe, either through your own pockets or by filing a claim against your gap insurance coverage.

My car is totaled and I only have liability insurance?

Liability insurance coverage helps you to pay the other party whose car you damage or who sustain injuries in an accident you caused. Liability coverage is mandatory in more than 95% of all states in the USA.

Liability insurance does not help in repairing your car or replacing it once it is totaled. It does not also help cover medical costs for personal injuries, you or your passengers incurred in the accident you caused. Liability coverage will help you to cover costs for the accident you are at fault for.

If your car is totaled and you only have liability coverage, then you will need to incur car accident costs if it’s deemed you caused the accident. If the accident is not your fault, the other party’s car insurance (liability coverage) will cover the costs to repair or replace your totaled car.


What to do with registration when car is totaled?

When your car is totaled and it’s now in the possession of your car insurance company, it’s a requirement you return the license plates to the department of motor vehicles (DMV). You should also inform your insurance company that you are no longer the owner of the car.

Regulations are different in states so I encourage you to find out further what the law requires in your state, or country of origin.

Informing the DMV and surrendering your totaled car plates implies canceling your car registration with the DMV.

Failure to do this could earn you a good number of penalties. It is also required to inform your car insurance that the vehicle is totaled to stop any further premium charges.

extrication, accident, rescue

What to do with license plates when car is totaled?

As I said before, you will need to return the license plates back to the department of motor vehicles (DMV), once you no longer own your totaled car anymore.

The laws are different from one state to another. some states require you to return the license plates while in others, the license plates are yours, and you can either transfer them to another vehicle or discard them.

License plates can be returned to DMV through the following

  • Hand the plates in person to DMV
  • Send them by mail
  • Fill out a form and or
  • Complete the process online.
  • You may also decide to hand the license plates to your nearest police station. 

The following information will be required while you are returning the license plates back to DMV.

  • Your name and address
  • Your driver’s license number
  • The make and model of your car
  • The year your car was manufactured.

Delay or failure to return your license plates, and inform the DMV could result in penalties like paying fees and fines. You also want to inform your insurance company if it’s not involved in the handling of your claim settlement.

Do I need to notify the DMV if my car is totaled?

According to INSURER’S NOTIFICATION TO DMV in Oregon, you have at least 30 days to inform the DMV of your totaled car.

Yes, you are required to notify the DMV in your state if your car is totaled. You can do this by returning the license plates to DMV and completing a form, or completing the process online.

totaled car

What happens when your car is totaled but still drivable?

There are many options here. if your car is totaled but still drivable, the insurance company might still pay your the actual cash value minus any deductible if applicable. Your insurance company will own the car and it may choose to sell it to a salvage yard or scrap it for spare parts. 

If your totaled car is still drivable and you need to retain it, you can still negotiate with your insurance company. You may receive a payout for the damages. Whether you successfully negotiate depends on the circumstances of your case, your car insurance policies, and laws in your state.

For instance, you can still own your totaled car in Indiana but with strict options. If you own the car, ie not leased or financing it, you can retain the totaled car. But the car receives a salvage title.

In Massachusetts, car insurance retains the title of your totaled car once it has paid out the compensation. The insurance company has the right to sell the crashed car to salvage yards. You can negotiate with the insurance company and pay the salvage value of the wreck if you want to retain it.

Cars that are declared total loss still have value. If you are living in Florida and you want to retain your totaled car, talk and negotiate with your insurance company.

In California, you can negotiate and retain your totaled car but the insurance company will deduct the salvage value of the car from the settlement (actual cash value) payable to you.

How to cancel registration on totaled car?

According to CANCEL VEHICLE REGISTRATION, yes you can cancel your car registration anytime you no longer own it, is no longer drivable, and or if the car is no longer operable.

To cancel the registration of your car, follow these 3 steps.

1. You will need the following information:

2. You can then cancel your registration either by:

  • Online, by visiting the driver’s e-service and following prompts or 
  • Cancel in person by filling out the above form and handing it to their offices.

3. You want to keep a copy of your cancelation information. Once you are done, I recommend you cancel your insurance coverage to avoid further premium charges. I strongly advise you to cancel registration before canceling the insurance coverage to avoid penalties.

If your car is totaled and you need to cancel the registration, you may need to return the license plates to the DMV in your state, or police station, and send them by mail. You will need to tell your DMV and insurance company that you no longer own the car.

totaled car

What happens to the license plates when a car is totaled in florida?

In Florida, if your car is totaled, you will need to send the title to the insurance company that settled your claim, and at the same time return the totaled car license plate to the California department of motor vehicles.

In Florida, you also have an option of retaining your totaled car’s license plates, but you must transfer the plates to another vehicle within 30 days. Failure to do so means that California will suspend your driver’s license.

What happens to the license plates when a car is totaled in nc?

If your car is totaled in North Carolina, you will be asked to remove your license plates and personal belongings and leave the totaled car with the insurance adjuster.

If you leased or financed your car, you will need to inform those respective companies and let them speak to the insurance company for details.

In North Carolina, the driver is required to return valid license plates to DMV, and or submit an affidavit indicating that the plates have been destroyed or lost. 

What happens to the license plates when a car is totaled in texas?

In Texas, you can retain the totaled car but the insurance company will deduct the salvage value from the fee you were supposed to receive as a settlement.

The insurance adjuster will ask you to remove your personal belongings along with the license plate after reaching an agreement on the settlement fee. You will be responsible for returning the totaled car license plates to the DMV.

What happens to the license plates when a car is totaled california?

Though you can retain your totaled car license plates, in most cases you will be required to return the plates to DMV in person or by mail. You actually have up to 10 days to surrender the totaled car’s license plates to DMV in California. 

In California, you have an option of retaining your license plate if you sold your car or scraped it. to retain your plates, you will need to file an application to keep the plates by assigning them to a retention document.

If you want to transfer your license plates from your old car to your new car, you will need to fill out a V317 form. A V317 FORM helps in transferring license plates from one car to another, and also helps you to keep your current registration if you acquired another car.


Car insurance guide to what happens to the license plates when a car is totaled. In some states, you can apply to retain your totaled car’s license plate, whereas, in many states, you are required to return the license plates to the Department of motor vehicles.

Leave a Comment

Your email address will not be published. Required fields are marked *