How do you find the residual value
How do you determine the replacement value and residual value of a car?
Calculating the residual value of the car after an accident and in the event of a total write-off: this is how it works
If the car was involved in an accident, the residual value together with the replacement value of the vehicle forms an important basis for action for motor vehicle insurance. Even when the car is sold, the residual value of the vehicle can serve as the basis for the sales price, the valuation and thus as a sales argument. Learn more about the residual value calculation and the replacement value of a car. Find out what amount is reimbursed by the motor vehicle insurance in the event of an economic total loss.
In addition to the information, on FairGarage you will find reputable and neutral vehicle experts in your region for the damage assessment and the residual value calculation of your car. At the same time, the current value of your car can be calculated online without obligation and free of charge.
Topics at a glance:
What is the residual value of the car
The residual value of a car is commonly referred to as the material value that a car still has after a traffic accident without any repairs. Most of the time it is only a matter of the pure material value of the car or various car parts that can still be used. The residual value after an accident is very closely related to the concept of economic total loss. A vehicle appraiser calculates whether there is a financial total loss after an accident by determining the residual value and the replacement value of the car. If the vehicle expert determines that the repair costs of the accident car are higher than the replacement value, an economic total loss has occurred.
What if the repair costs are less than the replacement value?
If the repair costs are less than the replacement value, the vehicle can be repaired in any specialist workshop of your choice. The motor vehicle insurance pays the repair costs that are either actually incurred during the repair or that were calculated by the motor vehicle expert in the report. Even if you buy another car, the purchase price of the replacement vehicle can be reimbursed up to the amount of the repair costs specified in the vehicle report.
What if the repair cost equals the replacement value?
If the cost of repairing the car is 100% of the replacement value, the actual repair costs can be reimbursed if the car is professionally repaired. This applies regardless of whether the car is still used. If the vehicle is repaired more cheaply or only partially, the repair costs can be demanded from the vehicle insurance company, which were stated in the vehicle report. In this case, the vehicle must be used and insured for at least six months.
What happens in the event of an economic total loss?
If the residual value calculation reveals an economic total loss to the car, in most cases it makes no sense to keep the vehicle or have it repaired. In addition, the insurance company does not pay for the repair of the accident vehicle in the event of an economic total loss. In this case, the vehicle owner is usually reimbursed the difference between the replacement value and the residual value of the damaged vehicle. Under certain conditions it is still possible to keep the car that was involved in an accident through no fault of your own and to be reimbursed for the repair costs.
A distinction must be made between the following cases in the case of an economic total loss:
- The repair costs estimated by the appraiser are between 100 and 130% of the replacement value of the vehicle;
- The repair costs estimated by the appraiser exceed the replacement value of the vehicle by more than 130%.
When the repair cost is between 100-130% of the replacement value
If the repair costs are between 100 and 130% of the replacement value, the so-called 130% rule applies. The vehicle owner can keep the car that was involved in an accident through no fault of their own if certain conditions are met. If the above requirements are met, the vehicle can be repaired in any specialist workshop. After the proven, complete and professional repair, the repair costs will be reimbursed according to the vehicle report.
The most important requirements are:
- The repair costs of the vehicle are a maximum of 30% above the replacement costs
- The vehicle will continue to be used and insured for at least six months. This is from the time of the damaging event.
- The repair of the accident vehicle must be carried out completely and professionally in accordance with the specifications of the report.
- An invoice for the repair costs must prove that the repair was carried out in accordance with the report. In the case of self-repairs, this must be proven by a repair certificate from a motor vehicle expert.
What happens if further defects are found during the repair?
If, in the course of the repair of the accident vehicle, additional accident-related, hidden damage and defects are found that were not taken into account by the vehicle expert in the report, the repair costs can increase by more than 30% of the replacement value. If the hidden defects are solely due to the vehicle damage caused by the accident, the 130% rule still applies.
When the repair costs exceed the replacement value by more than 130%
If the repair costs exceed the replacement value by more than 130%, the opposing vehicle insurance company will generally only reimburse the replacement value minus the residual value that was calculated in the vehicle report.
Sell a car in the event of an economic total loss
If the accident car is sold at its residual value, the replacement value minus the residual value achieved (gross) of the car is paid. In rare cases, the sales price can even be higher than the residual value determined. Here one speaks of a so-called excess proceeds. It is not possible to make a “small plus” when selling after an economic total loss. Any excess proceeds will be offset against the insurance benefits.
Normally, the car owner can either sell his car himself or - if there is no buyer for his offer - he can ask the other car insurance company to do so.
How can the residual value after an accident be calculated?
A neutral motor vehicle expert must of course inspect the car himself. This is the only way to fully take into account all of the vehicle's “personal” characteristics and features. The expert also checks many other questions relating to the car and the calculation of the residual value. This includes, for example, the vehicle value before the accident, the question of guilt, possible repair costs or the question of the price for which the car can still be sold after an accident. Together with regional factors and the general market situation, this results in a more accurate and fair residual value.
By the way: The cost of a vehicle expert after an accident is paid by the opposing insurance company, unless you caused the accident yourself. You are of course free to choose the vehicle expert.
What else is the residual value needed for?
It is obvious that the residual value of a vehicle after an accident plays a decisive role. But it is also an advantage to calculate the residual value before selling the car. Finally, the residual value calculation forms the basis for the current vehicle value and thus also for the possible sales price.
Can the residual value of a car be calculated online?
Every used car is unique due to its individual use, care, mileage and modifications. That is why the many individual features must also be included in a practical residual value calculation. A general online evaluation or the well-known lists such as the DAT market mirror therefore reach their limits. In order to be able to calculate real numbers for the residual value, there is no way around a vehicle appraiser or an expert. This is all the more true if a car insurance company is involved in the question of the residual value (accident, damage to property, storms, etc.).
Our FairGarage portal allows you to calculate the current value for your car free of charge with the online valuation. After entering the most important key data of the car (make, model, mileage, vehicle type, first registration), the approximate purchase value can be calculated. The calculated amounts and prices reflect the average residual value for cars of this type and age and can therefore only serve as an initial orientation. All individual features of your own vehicle, such as special equipment, general condition, visual defects, special paint, etc., cannot be taken into account when determining the residual value online.
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