The Actual Cash Value

If a vehicle has suffered severe damage, an insurer may begin the process of generating what is known as the actual cash value of that vehicle. This number, when compared to the cost of repair, is used to indicate whether or not the vehicle is to be deemed a total loss. When calculated, an insurer will provide money to the vehicle owner to the actual cash value to replace that vehicle if that number exceeds projected repair cost.

Contact your local Illinois car insurance agents of Insure on the Spot at 888-972-SAVE for more information about how you could be driving with an auto insurance policy better-suited to your needs.

Factors Involved in Actual Cash Values

Following an accident, insurers will almost certainly calculate a value lower than what the vehicle owner paid for that vehicle, as depreciation quickly sets in for most motor vehicles. The following contribute to the value of the totaled vehicle:

• Working condition of the vehicle prior to the incident
• How many miles are on the vehicle
• Prices listed by car dealers
• Blue book price
• Factors calculated in an insurance computer program

It is important to recognize that certain vehicles do not keep their worth particularly well, and may significantly drop off in only a few months or years off of the lot. As a result, it should come as no surprise to owners that when these models accrue a certain amount of mileage, the actual cash value may be particularly low.

Contact Us

While the actual cash value of a vehicle may only provide partial coverage of a new replacement vehicle, there is no coverage at all if a driver goes uninsured. It is not only financially responsible to carry adequate coverage, it is illegal not to. Contact your local Illinois auto insurance agents of Insure on the Spot today by calling 888-972-SAVE.