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Why Auto Total-Loss Rates Will Increase

A recent trend in car buying may spell an increase in total-loss rates.

By Greg Horn | Updated on August 19, 2011

At the end of 2010, the average new car price was $29,719, according to the Detroit Free Press. After five years, it’s also estimated that the average car will lose 60 percent of its value. That means in five years, a car that was priced at $29,719 with normal depreciation will be worth significantly less at approximately $11,887. 

Right away, experienced claims adjusters can see where I’m going with this. A vehicle that sustains a front collision that results in the deployment of both airbags and breaks the windshield can easily result in a total loss for a vehicle worth just $11,887.

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