Do I need to notify the DMV if my car is totaled?
From current statistics, there are more than 7.2 million car accidents in the USA yearly and this translates to more than 19,937 vehicle accidents hourly, and also at least more than 14 car wrecks every minute.
According to Total loss car sale, at least 384,000 cars are totaled, or written off yearly in the USA. By doing simple maths, at least 1 car is totaled every 90 minutes and this translates further to close to 1000 vehicles getting totaled daily.
If a mechanic declares your car as a total loss, it implies that your car is damaged beyond repair and therefore you are better off getting another vehicle. On the same note, your insurance company has the option of declaring your car totaled as an alternative to footing the cost to repair it after an accident.
But when is your car totaled and what happens when your car is totaled? Is it necessary to report your totaled car to your state DMV? How about your license plates? well, this article explores these very questions and goes the extra mile to clarify them even better.
Looking for a fast answer? here we go. Yes, you usually need to inform the Department of Motor Vehicles (DMV) if your vehicle is deemed totaled, as it may impact your car’s title and registration status.
But that’s not all. let’d dive deeper and look beyond this short answer. Alright!
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What Happens When Your Car is Totaled?
To understand this question, there is a background you need. For instance, how do insurance companies come up with a decision to total your car?
Here is an example to drive my point home. Assume you bought your car 5 years ago at $5,000. 2 years down the load, you get involved in an accident that ends up writing off your car.
Due to depreciation factors and other features, your car will be worth an amount of money that is obviously less than $5,000. Probably someone else could have offered you $2,000 to buy your car just before the accident.
If your car is not damaged beyond repair (written off), your car insurance should settle your car insurance claim by paying $2,000, instead of $5,000, unless your car insurance policy states so. In short, the company is helping you replace your car.
If your car sustained damages whose costs are less than $2,000, then your car insurance company could decide to repair your car instead of helping you replace it.
How much does insurance pay for a totaled car?
“How much insurance pays for a totaled car depends on many factors like the age of your car, its model, make, cost price, mileage, and of course the state you come from”, says Robert a traffic officer.
Using the above example. The $2,000 is called the market value, or the actual cash value of your car. The difference between the actual cash value (ACV) and the cost price of your car is approximately its depreciation value added to other factors.
Here is an example. Adam bought his car for $15,000 and the accident he got involved in 3 years later totaled his car. “You can’t believe it. My insurance company offered to pay me only $5,000 as its actual cash value which I refused right away”, said Adam.
“I renegotiated and brought evidence showing that my car was worth more and threatened to hire an attorney. I later settled when the company offered me $9,000″, concluded Adam.
What happens to the license plates when a car is totaled?
what happens to the license plates when a car is totaled depends on your state. In some states, DMV may require you to return your license plates whereas, in others, you have the freedom of retaining the tags if you choose to.
For example, Mark lives in Georgia and had his car totaled last year. “I really loved to retain my license plates, but DMV asked me to surrender my car’s license plates and registration”, said Mark.
In New York, the following happens to the license plates once your car is totaled. You will surrender the title to the insurance company and return the car tags to the DMV.
If your car is totaled in Pennsylvania, you will be asked to return the registration plates to PennDOT unless you need to transfer the tags to your new car.
What happens to the license plates when a car is totaled?
The fate of the plates when your car is totaled depends on the state you live in. Below are examples.
1. In some states, you will be required to return the plates to DMV once your car is totaled. DMV will cancel the registration and the plates will cease being functional.
2. In some states, the plates can be transferred to the replacement vehicle. In such states, you will only be allowed to do this if the vehicles are of the same type and you own the replacement vehicle.
3. In some states where you are not mandated to return the license plates, the driver could decide to keep them as a memento or scrap them.
How Do I Report a Totaled Car to the DMV?
Each state has its policies and guidelines you will need to follow if you need to report a totaled car to the DMV. Below are the steps.
1. Copy of the vehicle title. You cannot report a totaled car to DMV unless you obtained a copy of its title.
2. Value of the vehicle. DMV will ask you to provide an approximate cost of your totaled car. You can get this by asking for an appraisal or using an online tool.
3. Salvage title. You will need to have applied for a salvage title from the DMV once your car is totaled. Your insurance company could have already obtained one, so better ask them.
4. Submit the required paperwork. Depending on your state, DMV could ask you to submit documents such as a damage disclosure statement, accident report, or other forms.
5. Cancel your registration and license plates. Once your car is totaled and you already obtained the salvage title, you will need to cancel your registration and license plates with the DMV.
Having that said, do not take every word I just said because steps vary from state to state. I highly recommend speaking to your state’s Department of motor vehicles (DMV) or getting information from their website.
Do I need to notify the DMV if my car is totaled in California?
Every driver in California whose car is totaled needs to notify DMV or else will face penalties and or pay fines.
Notifying California DMV if your car is totaled, is a requirement for filing an insurance claim, getting a settlement, or keeping the totaled car if you chose to.
Do I need to notify the DMV if my car is totaled in texas?
Yes, you need to notify Texas DMV if your car is totaled and you must do this as soon as possible or latest by 30 days.
You will need to let Texas DMV know that you do not own the vehicle anymore. Do this online or by completing a Vehicle Transfer Notification Form.
Do I need to notify the DMV if my car is totaled in Illinois?
Your car in Illinois will be totaled if the repair costs exceed the actual cash value or market value just before the accident.
Once the car is declared a total loss in Illinois, the insurance company retains the task of notifying the DMV of the totaled car. Optionally, you too could choose to notify the DMV by following all the steps as explained above.
Do I need to notify the DMV if my car is totaled in Florida?
Just like in Illinois, your car will be declared a total loss in Florida only if it costs more to repair it than its actual cash value combined with its salvage value.
Following an accident in which your car is totaled, the insurance company takes over the ownership of the car wreck, and will be mandated to notify the Florida DMV- Department of Motor Vehicles.
Do I need to notify the DMV if my car is totaled in az?
Just like in the above-mentioned states, the insurance company will declare your car a total loss if it costs more to repair it compared to its market value added to the wreck’s salvage value.
You or your company will be required to notify the DMV within 10-30 days after your car has been totaled.
Do I need to notify the DMV if my car is totaled in NY?
“In new york, your car will be totaled if the costs to repair it exceeds 75% of its actual cash value added to the salvage value”, says Johnson, a car insurance adjuster.
Here is an example. Assume you bought your car at $10,000 and the car is totaled after 4 years. Assume the insurance company determines its actual cash value at $6,000.
The insurance company in New York will declare your car a total loss if it costs more than $4,500 in repairs.
The insurance company in New York will pay $6,000 as the ACV, and take ownership of the car wreck. Your insurance company additionally carries the obligation of notifying the New York DMV.
Do I need to notify the DMV if my car is totaled in Missouri?
The laws for totaling cars in Missouri differ from those in New York. In Missouri, your car will be written off if the costs to repair it exceeds 80% of the combined actual cash value and salvage value.
Using the above example, your car will be totaled if the costs to repair it exceeds $4,800 as opposed to $4,500 in New York.
“Should the insurance company choose to take ownership of the totaled car, the law requires it to notify the DMV within 1-30 days”, concludes Johnson.
Conclusion.
Do I need to notify the DMV if my car is totaled? Whether it is a requirement or not to notify the DMV of your totaled car depends on the laws in your state of origin.
From what I have covered, the majority or all states require that either you or your insurance company notify the DMV of the totaled car. You may face penalties if you chose to keep the car tags and use them the way you want before researching your DMV policies.
