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Question:
If my car is totaled, will I be paid replacement cost?
Answer:
When your auto is declared a total loss, unless you made special
arrangements and paid an additional premium, your insurance will only pay
you the actual cash value of the auto as of the date of the loss, not the
cost to replace it. Your auto's value is determined by the following
factors: the retail value for an auto of like kind and quality prior to the
accident; the price paid for the auto plus the value of prior improvements
at the time of the accident; the decrease in value of the auto resulting
from prior unrelated damage which is detected by the appraiser or for which
a claim has been paid; and the actual purchase cost of an available auto of
like kind and quality. If your auto has substantial value because of its
exceptional condition such as an antique, classic, or restored auto you
should have it appraised and insure it for the appraised value.
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