The value of the damages that your vehicle sustains after a crash can be complicated and confusing. It leaves you with a handful of decisions to make, and you need to be cautious to ensure that you make a sound decision. Should you retain it, or should you call car removals and get rid of it? Salvage value mostly determines the final decision. Here’s a quick guide from car wrecker Adelaide on how to determine your car’s salvage value.
What exactly is a car salvage value?
This can be termed the car’s resale value at the end of its useful life, and it can also be termed as an assessment of the vehicle’s depreciation. After an accident, the first thing you do after reporting it to the authority is inform your insurance company about the event. You need to file a claim to ensure that you get compensation to help you repair or replace the damaged car.
However, if you have made claims before, you understand just how strict the insurance companies can be. For starters, if you were not at fault for the accident, you need to pay a deductible and then later try to recover it from the negligent driver’s insurer. That is not all; the insurance company will always try to give you the lowest compensation value and convince you to settle for it. In this case, you must understand how the compensation value is calculated to determine if what you receive is fair or not.
The value that the insurance company offers you is determined by calculating the salvage value. Fortunately, you can also figure it so that you can make comparisons of the values you get with those of the insurer. Its salvage value is what you would receive if the insurance company decided to sell its parts. Also, it is the amount you get if you decide to get rid of it through car removals. To determine the value to pay you, the insurer will determine the car’s actual value and then deduct a certain amount of the salvage value, usually in percentage.
Read also: 6 Things to keep in mind before buying a used car
Here is how you can calculate the car salvage value and the actual car value
Check the vehicle’s features.
This includes the car’s model, make, and year of manufacture. What’s more? It would help determine its mileage at the time of the accident and its trim. If you do not know how to get this information, you can check it on the vehicle’s purchase contract, the instruction manual, or the title.
Calculate its actual value
At this stage, you can use the assistance of websites such as the Australian Automotive Dealers Association to help you calculate the car’s actual value or the ACV. It would help if you got its retail value by selling it to a private party and then obtaining the trade-in value. Sum up the two values and divide them into two to get the ACV. Try using different websites to see if the values are closely related.
Read more: Sell Your Unwanted Car Fast Before Christmas
Check other options
There are different methods of determining the actual value. You can try and research the recent sales of similar vehicles in our area and see if the value you got from the insurance company relates to the market price. Check the estimates from different listings for assurance. You can also ask for estimates from car dealerships and let them give you an estimate of your vehicle’s value. In this case, you will need to invite them over to see it.
Calculate the salvage value
The salvage value is usually determined based on the past auction values of salvaged cars and the cost of disposing of the vehicle. Insurance companies use different formulas to get the value, but the goal is always standard. The value they get will then be subtracted from the car’s actual value to determine how much they get paid as compensation.
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