• Michael Goodman

How does the insurance company value my vehicle?

How does the insurance company decide how much my vehicle is worth? Mike Goodman here, agency principal at Goodman insurance solutions. I want to talk about actual cash value, or ACV, as it pertains to an automobile insurance policy. So the way that actual cash value is going to work is that there are going to be a few different factors that go into determining the value.


The first and most important factor A lot of times is going to be the year model of the vehicle or how old it is at the time of loss. Also, what's going to go into this calculation is that the condition of the vehicle, a lot of times the condition of the vehicle is going to be paired right there together with the mileage of the vehicle. And so as expected, a vehicle that has only 10,000 miles on it, versus that same vehicle with 200,000 miles on it, those vehicles are going to be worth, they're going to have a value that is going to be different between the two of those. Because one obviously, with a lot fewer smiles, most likely that condition is a lot better.


The actual cash value of your vehicle or vehicles is always moving, okay, and so if a vehicle is brand new, you're most likely at the peak of that value, versus a vehicle that gets you to know, just say 1015 20 years down the road, you're kind of getting to the point in that vehicles live to where the value is going down. Now, at the same time, that vehicle, if it never gets driven, could be retaining more of that value as opposed to one that maybe has 400,000 miles on it.


A lot of times we'll see vehicles that ended up getting totaled out. And so what basically that means is that there is a point where the repairs exceed a certain percentage of the actual cash value which deems it a total loss. A lot of times I'll see that from anywhere from 75 to 80 85% of that value, where it's going to be deemed a total loss. And again, that's where the actual cash value comes in and is important and so if you've got further questions about this topic, in particular about the actual cash value in your insurance policy on your vehicle, please feel free to reach out to us anytime. Our phone number is 620-531-0261 or find us on most social media platforms. Thank you for your time and have a great day.

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