If you are buying auction cars in the USA, there is a chance that the vehicle you are buying currently has a salvage title. This means that you will not be able to insure the vehicle as it is when you purchase, and you will not be able to get the vehicle on the road. Instead, you will first need to get all the necessary repairs to get the car in shape and to make sure it is safe for the road.
Salvage cars have the potential to be a very good buy so long as you know what you are getting and you can be sure that the cost of the repairs will still keep your overall price for owning the vehicle down to a reasonable level. Next is the potential issue with getting the actual insurance.
Can You Get Insurance on Salvage Cars?
When a vehicle has a salvage title, you will not be able to get insurance on it. You will need to rebuild the vehicle so you can get a rebuilt title and registration, and then it becomes easier to get liability insurance.
In fact, most companies today will have no problem providing you with liability for your vehicle. This is because liability covers that damage that your vehicle does to people and property, not your actual vehicle.
The trouble comes when you are trying to get higher levels of insurance. For example, you might want to have collision or comprehensive coverage for the vehicle. This would provide protection for your car if you were in an accident or if it were stolen.
However, many insurance companies are not comfortable placing a monetary value on a vehicle that once had a salvage title. They have trouble determining how much the car is worth and how much coverage they should offer. After all, they don’t want to provide you with coverage for far more than the vehicle is worth because it puts them at a greater risk in case something happens, or even in the event of fraud.
Still, it is possible to find some companies out there willing to provide this level of insurance for auction cars in the USA with rebuilt titles. So, how do you go about finding them? It’s simple, but it will take some work on your part.
Finding the Insurance Company
First, start with your current insurance company if you have one. You can talk with them about the type of coverage they offer and see if they are willing to provide you with extra insurance for the car or not. Do not be surprised if they say no. It simply means that you have to start researching some of the other companies out there.
For example, Progressive tends to offer this type of coverage for rebuilt vehicles. Other companies do as well, but they do not all advertise this fact. You will have to contact the companies to see what they can do for you.
Something else you will want to keep in mind is that insurance companies will not usually provide coverage for a vehicle that they originally deemed a total loss. For example, if you buy a vehicle whose previous owner had Insurance Company A and that company decided that the car was a loss after an accident, you cannot go back to Insurance Company A and get insurance through them even after you own and rebuild the vehicle.
When you are looking for insurance companies, have as much inspection information and documentation as possible. If you can prove the mechanic declared the vehicle roadworthy, it can increase your chance of finding insurance for the car.
Also, make sure the company is offering fair premiums for the vehicle. In some cases, owners of vehicles with rebuilt titles say that the insurance companies are only offering high premiums. The opposite should be true, as the value of a rebuilt vehicle is lower than that of a new vehicle. If they try to charge too much, negotiate with them or simply move on to another insurance company.
As you start to research the different companies, you can expect that many of them will not be willing to offer coverage. However, some will be more receptive. Once you have a list of companies that are willing to offer this type of coverage for auction cars with rebuilt titles, you can compare the rates and the amount of protection they are willing to provide.