Total loss laws in Indiana

When is a car totaled in Indiana?

Short answer: Indiana sets no percentage threshold for insurer-paid claims (Ind. Code s. 9-22-3-3(a)), so the total-loss decision is generally the insurer's under your policy. The 70% figure in Indiana law does not apply when an insurer pays the claim.

A salvage title is required for a vehicle from the most recent 7 model years when an insurer has found it economically impractical to repair and has made an agreed settlement with the insured or claimant; no percentage applies to insurer settlements. The 70%-of-fair-market-value repair test applies only to businesses that insure their own vehicles or to owners who acquired the vehicle after the damage. A flood-damaged vehicle also requires a salvage title.

Source: Ind. Code s. 9-22-3-3(a) (FindLaw, current as of Jan. 1, 2026)

Many online tables mix up title-branding rules with the insurer's own decision. Compare the total loss threshold in every state.

Does insurance pay sales tax on a total loss in Indiana?

Short answer: Yes. Indiana requires a cash settlement for a total loss on your own policy to include sales tax (Indiana Department of Insurance Bulletin 82 (Feb. 25, 1994)). The rule does not clearly require title or registration fees.

Indiana Department of Insurance Bulletin 82 (Feb. 25, 1994) states the department's long-standing position that an insurer settling a totaled vehicle must pay the claimant sales tax in addition to the vehicle's value, computed on the amount the insurer pays for the vehicle, at the same time as the vehicle payment (no proof-of-purchase condition appears in the excerpts seen). The bulletin speaks of 'claimants', so it may reach third-party settlements too. Title and registration fees are not addressed in the excerpts seen.

Source: Indiana Department of Insurance Bulletin 82 (Feb. 25, 1994)

Tax on a replacement car in Indiana

7% state sales tax collected by the dealer (Form ST-108), or at the BMV for private sales. No local sales tax.

Source: https://www.in.gov/dor/i-am-a/business-corp/tax-form-types/vehicle-dealers/

See the sales tax and fee rule in every state.

How must the insurer value your car in Indiana?

No Indiana-specific total-loss valuation regulation (comparables, distance, dealer quotes) was confirmed. The unfair claim settlement practices statute requires reasonable standards for prompt investigation, a good-faith effort at prompt, fair and equitable settlement when liability is reasonably clear, and a prompt, reasonable explanation of the policy basis for a denial or compromise offer.

Source: Ind. Code s. 27-4-1-4.5

To check the numbers in your own report, read the CCC valuation report, line by line and how projected sold and typical negotiation deductions work.

How long does the insurer have to pay a total loss in Indiana?

Short answer: We found no fixed Indiana deadline in days to decide or pay a claim (Ind. Code s. 27-4-1-4.5(2), (3), (5), (14)).

The statute sets no fixed day deadlines: insurers must acknowledge and act 'reasonably promptly' on claim communications and affirm or deny coverage within a reasonable time after proof of loss is complete.

Source: Ind. Code s. 27-4-1-4.5(2), (3), (5), (14) (FindLaw, current as of Jan. 1, 2026)

Compare claim deadlines in every state.

Can you negotiate a total loss offer in Indiana?

Short answer: Yes. You can reject the offer in writing, ask for the full valuation report and the reason for each deduction, and send your own evidence. The Indiana Department of Insurance, Consumer Services Division takes complaints about claim handling.

Yes. The owner can send a written dispute asking for a reasonable explanation of the basis for the offer (IC 27-4-1-4.5(14)), demand sales tax on the settlement citing IDOI Bulletin 82, invoke the policy's appraisal clause if there is one, file a complaint with the Indiana Department of Insurance, or sue in small claims court.

1. Ask the adjuster in writing for the complete valuation report and the list of comparable vehicles.
2. Check it line by line: negotiation deductions, condition ratings, comparables, tax and fees. How to read the report.
3. Send a written rebuttal with your evidence and a specific number. How to dispute a total loss valuation.
4. If you still disagree on a claim under your own policy, consider the appraisal clause.
5. If the insurer does not follow the rules above, file a complaint with the state.

How long do you have to sue over a totaled car in Indiana?

Short answer: Generally 2 years to sue for damage to your car (Ind. Code s. 34-11-2-4(a)). Your policy may set a shorter limit for suing your own insurer.

Property damage claims in Indiana generally must be filed within 2 years. Your policy may set a shorter deadline for suing your own insurer; check its "legal action against us" clause.

Source: Ind. Code s. 34-11-2-4(a) (injury to personal property: 2 years after accrual)

How to file an insurance complaint in Indiana

Short answer: File a free complaint with the Indiana Department of Insurance, Consumer Services Division online. It asks the insurer for a written response, but it cannot set the amount you are owed.