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What Does “Total Loss” Mean? A car is considered “totaled” when an auto insurance company decides that the cost of repairs exceeds the car’s actual cash value (ACV). Some factors that help determine your car’s ACV include: year, make, model, mileage, pre-loss condition, salvage value, and sales price of similar vehicles in the area. Am I Covered By My Insurance? This question mainly depends on what type of car insurance coverage options you have. Comprehensive coverage protects your vehicle from damages that are the result of a wide variety of causes, such as theft, vandalism, natural disasters, and, of course, collisions. If your vehicle is deemed a total loss due to one of these incidents, you may receive compensation for your car’s ACV minus your deductible. Gap insurance or guaranteed asset protection insurance will cover the difference between what you owe in car loans or leases and the ACV of your car. A scenario of gap insurance coming into play might play out like this: You buy a car for $10,000 Over the course of your ownership, that car’s ACV has depreciated to $5,000 You still owe $6,000 in loans for the vehicle You total this car, and your insurance company pays you $5,000. Because you have gap insurance, you will not be responsible for the $1,000 that you still owe in loans.