What It Means and How We Settle
“Total Loss” is one of the biggest terms in motor insurance. It means your car is either gone for good or so badly damaged that fixing it just doesn’t make financial sense. Knowing how it works and how your payout is calculated can help you avoid surprises if it ever happens.
What Counts as a Total Loss?
In your Pineapple policy, a Total Loss can happen in two ways:
Theft or hijacking with no recovery – If your car is stolen or hijacked and never found.
Damage beyond economical repair (“written off”) – If repairs would cost more than a certain percentage of the car’s insured value, we’ll declare it uneconomical to fix and write it off.
In both cases, we stop talking ‘repairs’ and start talking ‘full settlement’.
How We Calculate Your Compensation
Your payout is based on the Insured Value Type listed in your Policy Schedule:
Retail Value – Based on the Auto Dealers’ Guide, which considers your car’s make, model, age, mileage, and condition at the time of the incident.
Specified Value – A pre-agreed amount, often for classics or unique vehicles, adjusted for any wear and tear since the valuation.
From that insured value, we may deduct:
Excess – The first amount you pay.
Dual insurance – If another insurer also covers the same event, their contribution will be deducted.
Depreciation – The natural value-drop over time.
Condition adjustments – Based on age, mileage, and overall state of the vehicle.
Betterment – If repairs or replacements would leave you better off than before, we may deduct the difference.
New vs. Pre-Owned Vehicles
New (within 12 months, first owner) – If you’re the first registered owner and your car is under 12 months old when written off, we’ll pay the current price of a brand-new equivalent (or nearest available model), minus your Excess.
Pre-owned/older – We’ll pay the Retail or Specified Value at the time of loss, adjusted for wear and tear, minus the Excess.
If Your Car is Financed
If your vehicle is financed, your payout goes to settle the loan first.
If there’s money left over after settling the loan, it’s paid to you.
If the loan balance is higher than the payout, you’ll need to cover the shortfall. That is, unless you have Credit Shortfall Cover, which bridges the gap so you’re not left with debt and no car.
Bottom line: A Total Loss can be a big moment, but knowing exactly how your payout is calculated and where it goes helps you navigate it confidently.
*The information provided here is for informational purposes only. For the full terms and conditions, please consult your policy wording.