Last Updated on December 31, 2025

If your vehicle is involved in a serious crash (or even certain types of major damage), your insurer may declare it a total loss.

A car is typically considered “totaled” when it’s not economical (or not safe) to repair—usually because the repair estimate meets a threshold set by state rules, your insurance policy terms, or both.

Because total loss rules vary widely by state, the exact same accident could lead to a “repairable” vehicle in one state and a “total loss” in another. Below is a clear breakdown of how total loss thresholds work and a state-by-state chart you can reference.

Key Takeaways

• A car is usually declared a total loss when repair costs meet a state threshold or a total loss formula, making repairs uneconomical or impractical.
• Many states use a percentage threshold (commonly 70%–80%), while others use a Total Loss Formula (repair cost + salvage value compared to the car’s pre-loss value).
• The “total loss threshold” is often tied to salvage-title rules—insurers may still total a vehicle below the threshold based on safety, parts delays, or economics.
• If you disagree with a total loss decision, you can review the valuation for errors, seek another repair estimate, or ask about keeping the car (retaining salvage) and the title/insurance implications.

What Is a Total Loss Threshold?

A total loss threshold is the point at which a vehicle is considered damaged enough (relative to its pre-accident value) that it’s treated as a total loss under that state’s guidelines.

Important nuance: in many states, the “threshold” is closely tied to salvage-title rules and consumer protection regulations—not a promise that every insurer will repair up to that percentage. Insurance companies can still declare a vehicle a total loss earlier if repairs are unsafe, parts are unavailable, or the economics no longer make sense.

Two Ways Total Loss Decisions Are Calculated

States generally use one of two approaches:

• Percentage Threshold (TLT): Repairs are compared to the car’s pre-loss value.
• Total Loss Formula (TLF): Repairs are compared to the car’s value after factoring in salvage value.

Method 1: Percentage Threshold

In a percentage-threshold state, the insurer compares the estimated repair cost to the vehicle’s pre-loss value (often called actual cash value).

Example: If your car is worth $10,000 and your state’s threshold is 75%, the tipping point is $7,500 in repairs. If the estimate is $7,600, the car may be considered a total loss under that state’s threshold.

Method 2: Total Loss Formula

In total loss formula (TLF) states, insurers typically use a calculation similar to:

• Repair Cost + Salvage Value ≥ Pre-Loss Value

Example: If your car is worth $12,000, repairs are $9,500, and the salvage value is $3,000, the total is $12,500—so the vehicle may be totaled under a TLF approach.

What Counts Toward the Repair Cost?

Total loss decisions often come down to what’s included in the repair estimate. Depending on the claim, the insurer and repair shop may account for:

• Parts and labor (including calibrations for cameras/sensors on newer vehicles)
• Paint materials and refinishing time
• Supplemental damage found after teardown (hidden damage behind panels)
• Potential delays and logistics (like parts availability), which can make a repair impractical
• In some situations, insurers may also consider post-repair market impacts like diminished value when deciding whether repairing a vehicle is truly “worth it”

Total Loss Thresholds by State

The chart below shows whether your state uses a fixed percentage threshold or a total loss formula (TLF). If your state uses TLF, there’s no single percentage written into the law—your insurer applies a formula using repair cost, salvage value, and your vehicle’s pre-loss value.

*Notes: Several states have additional fine print (such as rules that apply only to late-model or higher-value vehicles, exclusions for hail/glass, or unique consumer-rights rules). See the section below for the most common “gotchas.”

Notable Exceptions and Fine Print to Know

• Florida: The “80% rule” is often used as a guideline tied to salvage-title requirements. Insurers can still total a vehicle below 80% if it’s the most practical settlement.
• Iowa: Iowa’s law uses 70% as the “wrecked/salvage” disclosure threshold, but insurers can still set their own internal total-loss point.
• Minnesota: 80% generally applies to late-model (newer) or higher-value vehicles.
• Missouri: The 80% threshold generally applies to newer vehicles (late-model rules).
• Nebraska: The 75% threshold generally applies to late-model vehicles.
• North Dakota: The 75% threshold may exclude certain damage types (like glass and hail) under state definitions.
• Rhode Island: Rhode Island updated its total-loss consumer protections in 2025. There’s effectively a 75%–80% window where consumers may have additional say in whether a vehicle is repaired or totaled (depending on the claim and documentation).
• Texas: Texas uses a 100% threshold, but it can be based on adjusted repair costs (certain items like repainting labor/materials and sales tax may be treated differently under state definitions).
• Virginia and Wisconsin: These thresholds commonly apply to late-model vehicles and can differ based on vehicle age and title rules.

Why Total Loss Thresholds Matter

Total loss rules change the entire direction of your claim:

• In a 60% state like Oklahoma, vehicles can be totaled faster—even when damage seems “moderate.”
• In 100% states like Texas and Colorado, the same vehicle might still be repaired because the threshold is higher.

That’s why it’s possible for the same repair estimate to lead to totally different outcomes depending on where the vehicle is titled and insured.

Why Your Car Can Be Totaled After “Minor” Damage

Many drivers are surprised when a vehicle is declared a total loss even though it still runs and the damage doesn’t look catastrophic.

Modern repairs add up quickly: labor rates are higher than they used to be, parts can be expensive, and newer vehicles may require sensor calibrations, specialty materials, and more teardown time. On top of that, some models are simply easier (and cheaper) to repair than others. If you’re curious how much vehicle design impacts repairability, check out these cars with lower repair costs.

What Happens After Your Vehicle Is Declared a Total Loss?

If your insurer says the vehicle is a total loss, the next steps usually look like this:

• You’ll get a valuation report and settlement offer from the claims adjuster.
• The offer is typically based on the vehicle’s actual cash value (ACV) (what your car was worth immediately before the loss), minus any deductible you owe if you’re claiming on your own policy.
• If you have a loan or lease, the check may be made out to both you and your lender—and the lender gets paid first.
• If you have optional rental reimbursement coverage, your policy may help pay for a rental vehicle while the claim is being settled. If the other driver is at fault, their property damage liability may cover a rental instead.

Before you accept the payout, review the valuation carefully (trim level, mileage, options, condition, recent tires, etc.). Small errors can change the settlement amount.

Can You Dispute the Total Loss Decision or Keep the Car?

Yes—depending on your state, the repair estimate, and your insurer’s rules, you may have options. If you want a deeper walkthrough of the “keep it vs. total it” decision, start here: fight the decision.

Option 1: Get Another Repair Estimate

If your repair costs are close to the threshold, a second estimate can sometimes make a difference—especially if the original estimate included worst-case assumptions.

Just remember: even if you find a cheaper estimate, your insurer may have rules about estimates, parts, and safety. And in many situations, you’re not required to use a certain body shop, but you should confirm how your insurer handles differing estimates before authorizing repairs.

Option 2: Retain Salvage and Keep the Vehicle

In many cases, you can keep your totaled vehicle (often called “retaining salvage”). The insurer reduces your payout by the salvage value, then you keep the car.

After a total loss, the insurer may sell the vehicle at a salvage auction unless you choose to keep it. If you want to keep the car, ask your insurer about whether you can buy back your car directly instead of it going to auction.

Be aware: keeping a totaled vehicle usually means dealing with a salvage or rebuilt title, inspections, and more limited coverage options. Here’s a guide on how to insure it after a salvage or rebuilt title—plus a list of the best insurance companies for salvage titles.

Do Rates Increase After a Total Loss Claim?

A total loss claim can raise your insurance rates, especially if you were at fault.

If you were not at fault, your insurer may still adjust your premium depending on state rules and company practices—but in many cases, they should not raise your rates after a no-fault accident.

FAQs on Total Loss Thresholds by State

Final Word on Total Loss Thresholds

Total loss thresholds are set at the state level and vary more than most drivers realize. Some states total vehicles around 60%–70% of value, while others use a formula or even a 100% threshold.

If your car is near the tipping point, ask for the valuation report, understand what’s included in the repair estimate, and review your options before accepting a settlement.