What Does It Mean When A Car Has A Salvage Title?

Car Has A Salvage Title

In short a salvage title is a vehicle title that notes that the vehicle has been damaged to the point where an insurance company that paid a claim on it deemed it a total loss. Your immediate reaction is probably that you should stay away from any vehicle that has been a salvage title because, let’s face it, a total loss does not sound like a good thing. This is not far from the truth, but it is important to understand that the criteria for determining when a salvage title is issued differ considerably from state to state.

As a general rule of thumb, a salvage title is assigned to a vehicle when it sustains damage worth 75 percent or more of its current value. For example if you drive a 2006 Toyota Camry, worth about $10,000, well if that vehicle gets into an accident and suffers $7,500 worth of damage then it is going to get slapped with a salvage tag. This means that the vehicle is considered unfit to drive.

According to CarFax, 11 states also use salvage titles to identify stolen vehicles. Be sure to ask you independent auto insurance agent to see if this is true in the state you live in.

Now when a vehicle is given a salvage title, the insurer may offer to return the vehicle to the owner as an insurance buy-back, which makes the owner responsible for having the repairs made and having the car inspected by a state-designated person before it is fit to drive. Depending on the state, the salvage title may be removed after the inspection. Vehicles that are not bough back are auctioned as salvage to an auto recycler or a rebuilder and are given a salvage title.

For information about salvage value >

The resale of a vehicle with a salvage title can be tricky. If the vehicle has a salvage title, in most states it cannot be driven on public roads, impacting the resale value of the vehicle. Rebranding the vehicle can only done after a proper safety inspection.

If you are shopping for a used vehicle, you can be comforted by the fact that it is fraudulent to sell a vehicle without disclosing that it once had a salvage title. You should ask the seller to prove what work has been done on the vehicle and prove that it has been declared fit to drive.

You can always ask for a CarFax report. They can provide a detailed history of the vehicle’s history including frame damage and airbag deployment checks. The frame is very important to have checked because it is the base of the car. Anything that was bent and straightened after an accident can permanently be fatigued. This can cause future issues. The airbag deployment check can be helpful because it will tell you if a car was in an accident.

Whether you are shopping for a used vehicle or you are trying to sell a vehicle that has had a salvage title, it is important to understand what the title means. If you are shopping for a vehicle, you should know that the quality of the vehicle is dependent on the quality of the repairs. You can ask you independent insurance agent to give you a trusted mechanic in your area who is certified to inspect the vehicle, ensuring that you are making a wise purchase and getting a safe vehicle.

Other Enhanced Insurance articles related to Auto Claims:

Bodily Injury in a Car Accident; Are You Covered

What to Do after a Hit and Run Accident

Salvage Value of My Vehicle

Options When Your Car Is Totaled

Who Is At Fault in a Car Accident

What to Do After an Accident

How Is the Value of My Car Decided

Who Decides What Will Get Fixed on My Car

What Does It Mean when a Car Is Totaled

How Much Will It Cost to Fix My Car

What Do I Do If I Am Dissatisfied with My Auto Insurance Claim

My Car’s Market Value

Enhanced Insurance is not written by attorneys. If you’re looking for legal advice, you need to contact a lawyer. Further, insurance practices and forms change constantly and are varied from state to state. For definitive answers in your area, contact a local agent.

While the majority of people want an agent involved in their purchase of insurance, many people want to see if they can save money by buying direct from the insurance company. Others want to try a direct quote to make sure the premium they’re now paying through their local agent is fair. If you want a quote for your coverage, click on the competitive quote button on the right side of this page.

Jim operates an insurance agent network called Insurance Partners, aggregating agents in the Midwest for over 25 years. He was National Agent of the Year for Metropolitan in 1993 and Midwest Agent of the Year for Travelers in 2011. He served as a founding board member of the Surplus Lines Association of Minnesota.

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