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How Does USAA Calculate the Amount for a Total Loss?

by Tallulah Philange

"Total loss" is an auto industry term meaning that the cost to repair a car after an accident is more than the vehicle is worth. The car is considered "totaled"--another term for total loss. United Services Automobile Association, or USAA, considers two primary factors in calculating total loss.

Condition Pre-Accident

USAA looks at the condition of the car before the accident, to the extent possible. Insurance agents factor in the car's mileage, its age, and whether it had major mechanical defects on record. USAA then uses that information to look up the car's made, model, trim level and condition in an auto value guide.

Local statutes determine which guides may be considered. The insurance company turns to guides from the National Automobile Dealers Association in many states. USAA will consider two sources, and average the amounts, to begin to calculate total loss.

Market Value

USAA will scour local dealerships and private ads to find out what your car's make and model is selling for. This helps determine the market value for your car pre-accident. USAA weighs this amount against the value determined by car guides. A much higher market value might push up the total loss amount.

Factors Not Considered

USAA does not consider improvements to your car, even if they were made immediately before the accident. For instance, new tires or an engine job will not increase the insurance check you receive.

About the Author

Tallulah Philange has worked as a journalist since 2003. Her work has appeared in the "Princeton (N.J.) Packet," "Destinations" magazine and in higher education publications. She also has edited and produced online content for those publications. Philange holds a Bachelor of Arts in print journalism from American University and a Master of Arts in communication, culture and technology from Georgetown University.

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