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When Is a Vehicle Considered a "Total Loss" After an Accident?

In Tennessee, a vehicle is considered a "total loss" if the repair estimate exceeds 75% of the retail market value as determined by the current published retail costs (T.C.A. 55-3-211 [9][A]).

If you are involved in a collision in Tennessee and your vehicle is determined to be a total loss, then the insurance company should use mileage, options, and condition of the vehicle at the time of the accident to determine the value. The Tennessee Unfair Claims Settlement Practices states:

The insurer may elect a cash settlement based upon the actual cost, less any deductible provided in the policy, to purchase a comparable automobile including all applicable taxes, license fees and other fees incident to transfer of evidence of ownership of a comparable automobile. Such cost may be derived from:

The cost of two or more comparable automobiles in the local market area when comparable automobiles are available or were available within the last ninety (90) days to consumers in the local market area; or

The cost of two (2) or more comparable automobiles in areas proximate to the local market area, including the closest major metropolitan areas within or without the state, that are available or were available within the last ninety (90) days to consumers when comparable automobiles are not available in the local market area pursuant to part 0780-01-05-.09(1)(b)1. above;

It is important that you make sure the total loss settlement offer from the insurance company includes all applicable taxes, license fees and other fees incident to transfer of evidence of ownership of a comparable automobile as required by the Tennessee Unfair Claims Settlement Practices (0780-01-05-.09)(b). Each county has varying sales tax percentages for vehicles, as well as differing fees for vehicle registration, so you will need to contact the county court clerk in the county where you live to verify the amount that should be included in the settlement offer from the insurance company for sales tax and registration fees.

Written by Adrienne Waters Ogle

Attorney Adrienne Ogle is an awarding-winning Sevierville personal injury attorney serving clients throughout East Tennessee. She is a partner at Green, Waters Ogle and McCarter and has dedicated her career to protecting the rights of her clients and their families.