Total Loss regulations vary from state to state. And while we have put together an easy to use guide, interpretation of the various regulations can still be a challenge.
Regulations typically include information on valuation methods, total loss thresholds, salvage and sales tax requirements. These regulations are most often geared towards the general consumer and standard automobiles leaving specialty vehicles even more so to interpretation.
Furthermore, some states require specific approvals and licensing. For example, NH, CT, PA, and WY, have a specific list of approved resources for Total Loss Valuations whose methodology has undergone close scrutiny. DCI Solution is an approved resource in each of these states. NC, OR, and WA are states that have certain licensing requirements in particular when handling right of appraisal claim valuations. Members of DCI Solution’s staff are licensed in each of these states.
The majority, if not all, regulations state that a total loss valuation method must: 1) find a replacement vehicle; 2) use a recognized publication; 3) find comparable vehicles that have sold or are for sale; or 4) obtain dealer quotes. Again, these regulations seem to be geared for standard autos, these regulations can be much more difficult to meet for specialty vehicles. DCI Solution is completely focused on the specialty vehicle segment. Our staff is thoroughly trained to determine exactly what the loss vehicle is and then to find truly comparable vehicles for sale/sold and/or dealer quotes.
At the end of the day, an appraisal of a vehicle or other asset is still an opinion. But it is what your opinion is based on that lends credibility and accuracy to that opinion. Our methodology is fair, unbiased, and has been recognized as an approved method of determining value.
Total loss thresholds are pretty cut and dry, typically 70-75% of the actual cash market value of the vehicle. That’s where the challenge lies, in the determination of the market or total loss value.
Salvage requirements from a valuation standpoint are pretty straightforward. It’s really the title and documentation that poses the need for certain interpretative skills.
Sales tax and licensing fees are another animal themselves. While many states require that total loss claim settlements include sales tax and licensing fees, determining these amounts is another challenge. In South Dakota (DCI Solution’s home state), the sales tax rate on autos is much different than the general sales tax rate which might be used in a settlement as it is readily more available. There are certainly resources available to obtain accurate sales tax rates and fees for standard autos. Commercial and specialty vehicles are another story. While companies such as NuGen IT are working on a solution for this category, it is still up in the air and requires a lot of time, research, and best-guessing.
At the end of the day, our Total Loss Regulation guidebook makes it easy to find the regulations for every state but understanding and interpreting them is the key. Let the experts at DCI Solution handle that part for you. Every one of our valuation staff members has gone through extensive training, completed our certification program, and understands the regulations put in place by each state.
