Car write off calculator in Canada

If your car’s been in an accident, it can negatively affect its value — even if your car’s been repaired and shows no signs of damage. This depreciation in your car’s worth is called diminished value.

Car write off calculator and after accident car value in Canada

The car write off calculator below uses the most widely accepted method for calculating diminished value after and accident, the 17C formula. Most insurance providers favour this method, but keep in mind that it’s not universal.

Enter your car’s mileage in miles not kilometres when using the calculator below.

*What’s the estimated damage?

The calculator above applies a number to the value calculation based on how much damage your car took:

• 1.00 = Severe structural damage. Destroyed frame or windshield pillars, rollover damage
• 0.75 = Major damage to structure and panels. Broken frame, bent axles
• 0.50 = Moderate damage to structure and panels. Airbags deployed, large dents
• 0.25 = Minor damage to structure and panels. Dented hood or fender
• 0.00 = No structural damage or replaced panels. Broken side mirror, scratched paint, cracked headlight

Minor damage is usually surface (e.g. scratched bumper paint or a dented door). Major damage affects the car’s integrity, structural support or safety, and typically involves replacing an entire piece (e.g. damaging the car hood or airbags).

When would my car be considered a write-off?

Each insurance company sets its own standards to determine when a car is considered totaled. After it has determined your car’s value after an accident using formulas like the 17C method, it will decide whether or not to write off the car based on how much repairs would cost. Typically, if the value of the repairs is around 50% the value of the car, the car will be considered a write-off. Companies might have higher or lower thresholds, and some may use a total loss formula.

How do insurance companies calculate total loss for a write-off?

Each insurance company has its own criteria for write-offs. Insurance companies may use several different formulas to calculate whether a vehicle should get written off, like:

• Total loss ratio calculates how much repairs might cost as a percentage of your car’s value. You can calculate total loss by dividing the cost for repairs by your car’s cash value. Companies may set limits on how high the total loss ratio can be before the car is considered a write-off, which is typically between 50% and 100%.

• Total loss formula considers your car’s repair costs and salvage value before declaring it a write-off. If the cost of repairs plus the salvage value totals more than the actual cash value, the car is considered a write-off.
  • salvage value + cost of repair > cash value of vehicle = write-off
  • salvage value + cost of repair < cash value of vehicle = repair

Related: Best sites to sell a used car online

How the 17C method works to calculate car value after accident in Canada

Follow these steps to complete your own car write off calculation using the 17C method. Remember that your insurance company may not necessarily use the 17C method, but it is a common enough formula to help give you an idea of how a car insurance company may estimate your car’s value after an accident.

1. Determine your car’s value pre-accident.

The easiest way to check your car’s value is on sites like Carfax, Canadian Black Book or Autotrader.ca.

2. Apply a 10% cap.

Insurance companies assume your car won’t depreciate by more than 10%, so we start with this number and apply multipliers to decide the final percent change.

3. Apply a damage multiplier.

The insurance company will assess the damage to your car and apply a number from zero to one indicating the severity of the damage. This range can include any number from 0-1, not just increments of 0.25. This number is multiplied by the 10% cap.

• 1.00 = Severe structural damage
• 0.75 = Major damage to structure and panels
• 0.50 = Moderate damage to structure and panels
• 0.25 = Minor damage to structure and panels
• 0.00 = No structural damage or replaced panels

4. Apply a mileage multiplier.

Your car’s value is further adjusted to reflect the car’s mileage.

• 1.0 = 0–29,999 kilometres
• 0.8 = 30,000–64,999 kilometres
• 0.6 = 65,000–94,999 kilometres
• 0.4 = 95,000–129,999 kilometres
• 0.2 = 130,000–159,000 kilometres
• 0.0 = 160,000+ kilometres

For example, if your car has 35,000 km on it, you’ll multiply your adjusted value for damages by 0.8.

Example car write off calculation using the 17C method

Let’s say your car was worth $18,000 before an accident, with 35,000 km driven.

To start calculating your car’s value after an accident in Canada, you’ll first want to apply a 10% cap to the cost of your vehicle pre-accident, which means multiplying the pre-accident value by 0.1, as you can see below:

$18,000 × 0.1 = $1,800

That means the maximum amount your car can lose in value after being repaired is $1,800. If the damage to your car is assessed at 0.50 (moderate damage to structure and panels), you would then multiply $1,800 by the 0.50 damage multiplier:

$1,800 × 0.5 = $900

You then adjust the accident damage amount of $900 for the car’s mileage. Since the car has 35,000 km on it, you would apply the 0.8 mileage multiplier to it, by multiplying $900 by 0.8:

$900 × 0.8 = $720

That means your car’s value has dropped by $720 due to the accident. Finally, to calculate the value of your car after the accident, minus $720 from the initial car value:

$18,000 − $720 = $17,280

Using the the 17c method, your car has decreased in value by $720, or 4%. The new value of your car is $17,280.

Why is my car worth less after an accident?

Cars that have been damaged in an accident, even after a repair, are worth less than cars that have never been in a collision. The reason mostly comes down to perceived safety; a car that’s been repaired might not have been fixed properly or with original manufacturer parts. And you’re typically not covered by a manufacturer warranty or recall in those cases either.

That fact can come back to haunt you if you try to sell your car. Every car accident goes on your car’s vehicle history report. Buyers will be able to see your car’s history of repairs and accidents, and also your car’s diminished value.

Your car’s diminished value after an accident is important to understand if you want to refinance or sell your car, or if you want to file a diminished value claim with an insurance agency because of an accident where the other driver is at fault.

Can I make a car insurance claim for diminished value in Canada?

Most Canadian insurers won’t approve claims for diminished value following a car accident. Generally, payouts are made for “direct losses” related to car accidents. It’s difficult to convince an insurance company that long-term damage to a vehicle’s resale value directly stems from physical damage because of a mishap.

There has been the odd case in Canada where vehicle owners have successfully sued insurance companies for additional damages because of their cars’ diminished value. It may even be possible to win damages related to diminished value by suing the private party at fault for the accident, which would fall under tort law not insurance law. But by and large, the law is still largely in insurance companies’ favour.

Your insurance policy may allow for vehicle repair or replacement. Insurers seek to compensate you with a car that’s in a similar condition to the pre-accident vehicle, either by repairing the car to its original condition or paying out the value of your car if it’s totaled.

Diminished value types and definitions

To understand your car’s diminished value, insurers and courts use a few different definitions of diminished value.

• Inherent diminished value. A decrease in value due to the stigma of being in an accident. Most buyers distrust the quality of a vehicle that has been involved in an accident.
• Instantaneous diminished value. How much your car is worth immediately after an accident. Your car’s immediate post-accident condition is when your insurer decides the cost of repairs to restore your car to its original condition, not necessarily its original value.
• Repair-related diminished value. A decrease in value related to poor or negligent repairs.

Related: How to reduce your car's depreciation

What can I do if my car is worth less after an accident?

• Make a claim for diminished value. If your province or territory allows it (as is the case in BC and Alberta), you could recover some of your car’s lost value.
• Pick a payout over repairs. If your car isn’t declared a total loss (repairs cost more than the car is worth and fall close to value of a total loss claim), you can try to make an appeal for a total loss decision instead. You’ll get paid cash for your car’s pre-crash value instead of getting a car that’s worth less after getting repaired.
• Drive your car until it’s no longer driveable. If you don’t sell your car, you won’t have to worry about diminished value.
• Avoid a salvage title. You’ll typically have the choice to buy back your car on a salvage title if it’s declared totaled. But your car will be worth even less in this case since it’s not repaired and carries a salvage title. Some people consider keeping their salvaged car for nostalgia or to repair it themselves, but the car won’t be worth much in this case.

Bottom line

Not all insurance companies will use the same calculations to arrive at the diminished value of your car post-accident, but using the 17c formula will give a good starting point. Know how much your car is worth, so you’re prepared to sell your car or decide how much car insurance you need.