Residual value, current value, replacement value — explained simply
Three terms that determine your compensation in a total loss. We explain the difference in plain language.
Replacement value
The replacement value corresponds to the cost that would be needed to acquire an equivalent replacement vehicle on the used-car market. It is the central reference figure in an economic total loss.
Residual value
The residual value is the amount the damaged vehicle would still fetch in its current condition — for example through sale to a specialized buyer. The difference between the replacement value and residual value gives the compensation.
Current value
The current value reflects the calculated value of the vehicle, taking into account age, condition and market trends. It is used mainly as the reference figure in comprehensive insurance.
Why the distinction matters
Insurers sometimes calculate with inflated residual value offers from nationwide residual value exchanges in order to push down the compensation. As an injured party, you are not obliged to accept such an offer if you sell the vehicle locally at a realistic price.
Questions about your specific case?
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