There is no doubt that most people hope that you will never have to use their car insurance. This is a pity, but the accidents happen from time to time. Sometimes these accidents lead to general loss of a vehicle. What exactly does “common loss” meanAnd how is this different from “constructive general loss”? In this article, we will explain everything you need to know about the structural general loss of car insurance.
What is a structural general loss?
The term “structural general loss” can also be cited as a “virtual general loss” when the actual price for repairing a damaged vehicle exceeds the real monetary value. As a result, if the cost of repairing a car is more than the value of the vehicle, the insurance company may consider it a A constructive general lossS Suppose you were in an incident with your car and the damage is 60,000 RM. Following market research, the insurance company determines that the vehicle costs 50,000 RM. If that was the case, the insurance company would consider the car a A constructive general lossMainly because the cost of repair exceeds the value of the car.
What is the importance of understanding a constructive common loss?
Understanding a structural general loss is crucial because it can affect the compensation you receive from your insurance company. If the insurance company announces your car as a structural general loss, then you will only receive the actual monetary value of the car minus all deductions you may have. In other words, if the actual monetary value of your car is 50,000 RM, you will only receive this amount minus all deductions you may need to pay. It is important to remember that the actual monetary value of your car may be less than the one you have paid for it or less than what you still owe. As a result, you may be in a difficult financial situation, especially if you still have a car loan to pay.
If your vehicle was a loss, what should you do?
If your car is declared constructive general lossSeveral options are available. It is possible to:
- Accept the compensation of the insurance company and buy a new vehicle with it
- Keep the car and reject the payment but you will have to pay for the repair
- Check with the insurance company to see if an increase is possible.
Remember that the offer of the insurance company may be less than what you expected or less than what you owe to your loan. The best action in these situations is to consult a lawyer or expert to understand your rights and opportunities before deciding.
Definitive
Damaged vehicles are structural common losses when the repair costs exceed the monetary value. A clear understanding of this concept is essential as it may affect the compensation you receive from your insurance company.
Suppose your car has been declared constructive general lossS In this case, you have several options, including to accept the compensation, to reject it and to maintain the car or to negotiate with the company to increase the offer. Consult an expert before deciding. Finally, always drive safely and be prepared for the most, but always hope for the best.