The salvage value of a vehicle determines how much a car is worth after use, or how much could be earned from selling it. Rather than a precise formula, this price is an estimate. Thus, there are certain factors to take into account when calculating the salvage value of an automobile including mileage, damage, cleanliness, and overall appeal. Thereafter, salvage value can be computed into a formula to determine its depreciation. Several online resources are also available to help assess the salvage value of your vehicle.
Research the retail value of the vehicle. Be sure to look into a variety of dealerships and advertisements to calculate this value accurately.
Figure out the car's trade-in value by researching online or calling dealerships for an estimate.
Average the retail price and the trade-in value of the car by adding the two numbers together and dividing their sum by two--this will produce your vehicle's market value.
Contact your insurance company and ask for its percentage rate of market value for your type of automobile.
Calculate the salvage value by multiplying the market value by the decimal form of your insurance company's percentage.
Example: An 80 per cent percentage with a market value of £1,300 would equate to (0.8 * 2,000) = £1,040
Perform these steps yourself rather than using an online source for a more exact pricing of your vehicle's salvage value. Note that the typical salvage value of a car ranges from 20 to 50 per cent of its retail value.
Tips and warnings
- Perform these steps yourself rather than using an online source for a more exact pricing of your vehicle's salvage value.
- Note that the typical salvage value of a car ranges from 20 to 50 per cent of its retail value.