Insurance companies normally use insurance adjusters from their claims department to investigate an accident and the vehicles involved. The insurance adjuster will typically look over the vehicle for damage and review the estimates from the mechanic or repair garage to assess what all damage was sustained by the vehicle in the collision.
Generally, when the cost of repairing a motor vehicle is equal to or more than the current actual cash value (ACV), a car is considered by an insurance company to be a total loss. Each insurance company has their own way of calculating ACV but typically it can include the blue book or NADA value, local comparable vehicle sales and
their own internal information.
Due to the high price of new airbag components and installation costs many vehicles with a low ACV will be considered a total loss if the airbags and other repairs cost more than the ACV. On the flip side, if the vehicle has a high ACV, the cost of new airbags being installed will not likely cause the vehicle to be declared a total loss.
The broad statement that all vehicles in which airbags deploy are declared a total loss is not true. Bet You Life On An Airbag is an article in our Learning Center that will give you information regarding airbags and how the work.