Q:

How are auto salvage values calculated?

A:

Quick Answer

There is no universal calculation to determine the value of a salvage vehicle, but there are some guidelines that can help a person determine a ballpark figure. These include checking details of the vehicle, then doing some calculations to determine the salvage price.

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Full Answer

The first thing to do to attempt to determine the salvage price is to check on the current retail price of the vehicle by using a source such as Kelley Blue Book. Once the retail price of the vehicle has been determined, automatically take 40 to 50 percent of the retail cost to get an approximate salvage value. Keep in mind that this is only a ballpark figure, and the actual deduction depends on the damage to the vehicle. Also note that insurance companies typically take 70 to 80 percent of the retail cost to determine salvage price.

Another way to determine the salvage value of a car is to add the retail cost to the estimated value given by an insurance company, then divide it by two. This gives the average rate of the price. In addition, the percentage of depreciation can be used to determine the current market value of the car. When the current market value is determined, multiply the value by the percentage used by the insurance company. This gives the approximate salvage vehicle value.

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