Sometimes an auto loan balance is more than the fair market value of a car. This can happen when the person who get into an accident has a brand new car that's being financed for the entire purchase price. Particularly with luxury vehicles, the fair market value diminishes immediately after driving off the sales lot! The carrier, in those circumstances, sometimes doesn't pay off the whole loan, (because the market value of the vehicle is less than the balance of the loan), and the vehicle owner can end up still owing on a loan for a car they can no longer drive! If potentially at risk for such a situation, you may consider "gap insurance" in order to cover this difference. Talk to your insurance representative about this, particularly if you're thinking of purchasing a brand new vehicle with little or no money down.