All you need to know about total loss
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Following an accident, the expert's diagnosis may show what's known as total damage. This means that the vehicle will not be repaired, due to technical impossibility, or amount of repairs too high.
This sword of Damocles is often synonymous with a rather limited reimbursement of the vehicle. In this article, we'll take you through everything you need to know about total damage. You'll also see that some insurers offer solid guarantees, for the best possible compensation in the event of total damage.
What is total damage in Swiss car insurance?
To fully understand what we're talking about, it's important to define the two types of total damage. We can also ask what amounts the insurer considers to be a claim of this type.
Technical total damage
We talk about total damage from a technical point of view, when it is impossible to repair the vehicle. Here, we're not necessarily talking about the financial cost, but genuinely about the impossibility of getting the car back on the road.
To give a very simple example, a burned-out vehicle, with only the chassis remaining, could never be put back on the road, for example.
Total economic damage
Total economic damage occurs when the car is repairable, and the insurer chooses not to finance repairs because the cost is too high.
To assess the appropriateness of starting repairs, the insurer will look at what's known as the vehicle's market value. This is the value at which the vehicle could be resold in its pre-loss condition. The insurer will then compare this figure with the total cost of repairs.
If, for a car valued at 10,000 francs, repairs amount to 12,000 francs, the claim will be classified as economic total loss.
The case of vehicle theft
In the case of vehicle theft, it is also possible to be considered as being in a case of economic total loss. For this, the car must have been stolen for 30 days, without having been located. The owner of the vehicle must also be insured against theft.
What is the threshold above which total damage is declared?
To find out the amount above which the insurer will no longer cover vehicle repairs, it's important to consult the Conditions Générales d'Assurance. These are enclosed with the insurance contract at the time of subscription.
For most car insurance companies, when repair costs exceed 60 to 65% of the vehicle's value the claim passes into economic total loss.
Who determines that it is total damage?
It is an expert commissioned by the insurance company having to finance the repairs, who determines whether it is total damage. His report is based on:
- His assessment of the vehicle's market value,
- His study of the cost of repairs, generally provided by a garage owner,
- His appraisal of the vehicle's condition before repair.
For the insured, it is possible to contest the appraisal, by requesting a counter-appraisal. However, it is possible for this request to remain at his expense, depending on what is stipulated in the general conditions of the contract.
When it's a third-party insurer that has to mandate an expert, the vehicle owner's insurer can also request a counter-expertise in the event of disagreement.
What cover is needed to be reimbursed in the event of total damage?
Please note that a simple civil liability policy does not allow you to be reimbursed in the event of total damage not caused by another driver. Here, then, are the essential coverages, if you wish to obtain reimbursements for this type of claim.
Partial casco
It is possible, for example, to be compensated, thanks to what is known as partial casco. This covers against external risks such as:
- Collisions with animals,
- Damage to windows such as glass breakage,
- Vehicle theft,
- Theft of personal belongings from inside the vehicle,
- Natural damage such as hail, landslides or floods.
So, if the total damage is determined after severe weather, you need this coverage to be able to claim compensation.
Collision damage waiver
Collision damage waiver is another warranty, which covers the car owner in the event of a collision for which he or she is responsible. For example, in the event of an accident with another car, where the owner is at fault, no compensation will be possible without the latter.
Let us also point out that we speak of comprehensive casco, when the contract combines partial casco and collision casco.
Additional options
Some insurers offer additional options to be added to the contract. These can include practical cover, such as the possibility of enjoying a loan vehicle for a period of one month in the event of total damage.
They can also provide for better reimbursement, with an increased market value in the event of a claim, or purchase price protection with 100% reimbursement, beyond the first years of the vehicle's registration.
How much compensation in the event of total damage?
The amount of compensation offered by the insurer depends not only on the vehicle, but also on whether or not the insured owns it.
When you own the vehicle
When you own the vehicle, the insurer will perform a calculation taking into account the vehicle's replacement value and its residual value. It will then be able to calculate the amount of compensation offered.
Some insurers offer to reimburse 100% of the vehicle's price in the event of total damage, for the first two years in circulation. This is notably the case with Allianz, Générali, Helvetica and Smile. For subsequent years, most insurers reimburse the market value. A surcharge may be added, depending on the options taken out by the insured.
When it's a leased vehicle
When leasing, most vehicles are covered by acomplete casco-coverage. However, the amount reimbursed may be limited to the vehicle's market value. Any difference will therefore have to be reimbursed by the car's lessee.
Who indemnifies the vehicle owner in the event of total damage?
When the vehicle owner is deemed responsible for the loss, it's his or her own insurance that indemnifies the total damage.
On the other hand, when another road user is held responsible for the damage, it's his or her insurer who must reimburse the vehicle owner. It is under civil liability, that the insurer is effectively obliged to reimburse the damage caused by its customer.
Which insurance provides the best compensation in the event of total damage?
Most insurers compensate 100% of the vehicle's purchase value for the first two years of registration. Only Axa and Zurich do not offer this option for the second year, without taking out additional cover.
It was also important for us to compare insurers, for vehicles that have been on the road for more than 5 years. Among the best reimbursing insurers are Générali and Helvetica, promising reimbursements of 60-70% of the purchase value. By way of comparison, companies such as Allianz or Elvia only offer reimbursement of the market value plus a 20% surcharge.
Updated on: 30.01.2024Written by Antoine LégerHead of non-life insurance department at Comparea.To learn more about our team click here.