Insurance companies often declare accident-damaged vehicles as total losses rather than pay for repairs. The typical rule is that if the cost of repairs will exceed 70%-75% of the replacement value, then the vehicle will be totaled.
This can vary by state. In many cases these "distressed" vehicles are not rebuildable at all. However, in other cases, distressed vehicles have damages that can be easily repaired and are perfectly rebuildable to full safe operational condition.
In cases such as those in which a large number of vehicles are damaged at the same time, as in a flood or hurricane, an insurance company may survey only a few vehicles and then, to save time and expense, declare large groups of similar vehicles as total losses even though some of the vehicles may have only minor damage.
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