car restoration
Salvage Cars Car Insurance

How To Restore, Rebuild and Re-Insure a Salvage Car?

By Mike Richards Updated: 07/30/2017 Posted: 10/24/2015

Salvage cars represent fantastic opportunities to anyone looking to get a used car at a low price. However, these types of cars need to be restored, rebuilt, and then re-insured before they can be driven legally. Here’s what you need to know about the entire process, from getting your car home off the auction lot to getting it back on the road safely and legally.

You Need to Follow the Letter of the Law from the Very Beginning

Once a car gets totaled or written off by an insurance company, it passes into the company’s possession and gets its regular title certificate traded in for a salvage title. This is a legal document that shows the car’s status as a salvage vehicle and makes it impossible to register or insure in order to drive it legally. It doesn’t matter if it’s still mechanically sound enough to be taken on the road or not.

This means that even when you buy it from an online or in-person auction, your new salvage car needs to be transported on a trailer to your address. In some states, it’s even illegal to have the car towed home if it means its front or rear tires are in contact with the road.

Getting Your Car Inspected

Once you’ve finished your repair work and the car is in a drivable condition once more, you’re going to have to comply with all the regulations in your state’s salvage laws in order to get the car registered. For the most part, this means you’ll have to call up your state’s department of motor vehicles or stop by in person to pick up the requisite forms for a salvage vehicle inspection.

These inspections are conducted by state officials, usually state police officers or DMV employees, who check that all the parts you used in your rebuild were obtained legally. This means you can’t throw out any of the receipts or bills of sale you end up with during the rebuilding process. This also means you’ll need to present your bill of sale from the auction house and your salvage title.

If your car passes, you’ll be given a new title certificate, often referred to as a reconstructed or rebuilt title, that will let you insure and register your car.

Insurance: A Requirement and a Nuisance

Insurers are reluctant to provide coverage for these types of cars. While they offer at least state-minimum cover in the form of personal liability and property damage (PLPD) insurance, it can be very difficult to find an insurance provider willing to offer you greater coverage.

However, insurance companies are often willing to offer you physical damage coverage like collision or comprehensive insurance if you’re in turn willing to have your car inspected by a representative from the company. If the results of the inspection convince the insurance carrier that the car is in good condition, you can often negotiate higher coverage levels. 

This will mean you’ll be paying more when it comes to your insurance premiums, since a rebuilt salvage vehicle is always a risk to insure.

Find information on Rebuilt Title Laws for Each US State. Explore our Vehicle Auctions and find information on Buying With Us.

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