Modern Cars Are Totaled Out Far More Often

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Modern Cars Are Totaled Out Far More Often
Modern Cars Are Totaled Out Far More Often

We’ve noticed, both from professional and personal experience, that it seems to take little damage for an insurance company to total out a modern car. That means diminished value and possibly having to shop for a new ride for many people, hurting consumers and affecting insurance rates.

Report claims distracted driving rates fell in 2023.

This topic was recently covered by Bloomberg as it detailed out the modern “disposable car” and its implications. Just as we’ve experienced, the main culprit behind modern vehicles being totaled out left and right is the plethora of onboard electronics. More specifically, driver assistance systems, like radar cruise control, automatic frontal braking, blind spot monitoring, etc. are the big contributors.


In fact, Bloomberg found over 20 percent of modern cars are totaled out by insurance companies after a claim is made. If you’re thinking that’s not too high, it’s apparently five times higher than the percentage in 1980. Times have changed, and not for the better.

Another contributing factor is people who stretch far, perhaps opting for a long loan term, to buy their vehicle while at the same time opting for lower insurance coverage. The combination is a ticking time bomb which goes off once a big insurance claim is made.

High prices for car parts, something which is still ongoing to the shock of those who haven’t shopped for any lately, is also fueling this bad situation. With higher repair costs, insurance companies are more likely to total out a vehicle because the cost of fixing it exceeds the value.

Compounding the situation even more is the disparity between new and used car prices. While the used market has deflated considerably in the past year and a half, new vehicles have stabilized. That means insurance companies are more likely to pull the trigger and brand the title of a car.

Also, just as we’ve suspected for some time, the ones who are getting fat off this landscape are the auction firms like Copart and its many competitors.

It’s a horrible situation to find yourself in. Perhaps some market changes will shift the dynamic back to sanity, but until then there’s a strong flow of newer cars going to insurance auctions with shockingly little damage.

Image via Danny Garcia/Facebook Marketplace

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