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How to Insure a Salvage Car in North Carolina?

Date: 10/17/2015 |Category: Car Insurance, Salvage Cars

Have you ever considered a salvage car? If you live in North Carolina, you could actually choose to purchase one of these vehicles through an online auction and save yourself even more time and money.

What Is a Salvage Car?

If a vehicle is damaged, such as in an accident, a flood, through hail, or even in a hurricane or other natural disaster, then the first thing an insurance company will do is determine the price to repair the vehicle.

Each state has different rules about when a vehicle can be declared as salvage. In North Carolina, if the insurance company would have to pay 75% or more of the value of the car, then they can declare it as salvage. You may know this as “totaling” the vehicle.

In this situation, the insurance company will replace the car completely for the owner. Then, they will take possession of the totaled car and have a salvage title declared on it. Often, if the damage is not so severely extensive, then the cars will be sold at auction. This allows individual buyers and dealers to make purchases for pennies on the dollar.

Like every other state, in North Carolina, if a car has this type of title, then all sellers must declare to the buyer that it has been salvaged. Choosing to conceal this type of information is actually a misdemeanor offense.

Types of Salvage Vehicles

The state of North Carolina has a few different types of salvage vehicle title classifications based on the type of damage it sustained. These classifications include the following:

  • Salvage Rebuilt Title – These are the vehicles that we have already mentioned. They have had repairs made so that they can be properly licensed and insured.
  • Flood Vehicle – Specifically, these are cars that have been salvaged because they had floodwater that had risen above the transmission.
  • Reconstructed Vehicle – This is a title for a vehicle that has been constructed out of separate vehicle parts; sometimes referred to as a “kit car”.
  • Junk Vehicle – This refers to salvage vehicles that have sustained so much damage that they cannot be repaired and are of no resale value at all. They are not titled and are usually sold for scrap parts.

Can a Salvage Car Be Insured?

To legally drive a vehicle in the state, you will need a certain level of insurance. This can be somewhat of a problem with salvage vehicles, but it is not impossible to get coverage. You just need to know what you have to do in order to make it happen.

You will need to repair the car into good working condition, and the state will need to deem it safe for driving. At that point, you can actually get something called the rebuilt certificate of title. The car will still be listed as salvage, but the rebuilt certificate means you can get insurance and legally drive the vehicle.

To do this, you will need to provide the following when visiting your local DMV in North Carolina:

  • The salvage title on the vehicle.
  • The bill of sale for the vehicle.
  • A check for the title fees.

You may need some other documentation if your vehicle is newer than six years old. In that case, you will need to have an anti-theft inspection. This will be done at the License and Theft Bureau of North Carolina.

Additionally, since you are applying for a rebuilt certificate of title, then you will also have to get a safety inspection also done through the License and Theft Bureau of North Carolina.

This is not one of the common types of inspections you may be used to for safety, emissions, or insurance. Instead, it is designed to determine if a vehicle is roadworthy, and, without it, you cannot get the rebuilt certificate.

Some insurance companies may also require a safety inspection on the vehicle before they offer coverage. There are stations that perform these inspections throughout the state, and you can locate the closest one to you by visiting the North Carolina Department of Transportation website.

Generally, the safety inspection is used on vehicles older than 35 years old, but it could be a requirement in salvage situations because it will look for problems with headlights, accessory lights, turn signal, parking brakes, the main brake, and the steering controls.

Once you have gone through all of the steps, then you will be able to get insurance on your vehicle. Keep in mind that you may have to shop around for different insurance companies. Some will be willing to provide full coverage, but most will only offer liability even on a rebuilt certificate of title vehicle.

Find information on Rebuilt Title Laws for Other US States. Explore our Vehicle Auctions, as well as finding more information about How These Auctions Work.

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