Yes. If you want to keep the wreck, the salvage value of the wreck will be deducted from your insurance pay out.  If instead of receiving a pay-out, your car is replaced (for example, because your policy has a condition where if your car is not more than 12 months years old, you will get it replaced) you may need to pay your insurance company the salvage value if you want to keep the wreck and have a replacement car.