salvage cars
What is Salvage title? Car Insurance

Tips on How to Buy, Restore and Insure a Salvage Car 

By Mike Richards Updated: 05/23/2019 Posted: 10/22/2015

If you’re looking for a relatively inexpensive way to buy a used car, you might just want to consider looking into a salvage car. These vehicles, which usually have been damaged to the point where the original owner’s insurance company totaled them out and wrote them off, can be very inexpensive.

However, when it comes to buying, restoring and then insuring a salvage car there are some things that you should know well beforehand. Here are some tips on how to deal with salvage vehicles.

Finding a Salvage Car Will Mean Attending an Auction

By and large, salvage cars are not available at your local used car lot. First, salvage vehicles are not legally drivable – even if the damage they sustained didn’t result in any debilitating mechanical problems – and second, the majority of salvage cars are sold by insurers at auction.

However, you don’t necessarily have to show up in person at the next used car auction that’s open to the public in your area if you’re looking for a salvage car. You can simply find an online car auction website, register with the site, and bid remotely. This is often a good choice for those who don’t have the time or inclination to subject themselves to the in-person auction experience.

Just be aware that however you buy a salvage vehicle, you’ll have to budget extra for transportation costs as no car with a “salvage” title is permitted back on the road without being repaired first.

Putting the Pieces Back Together

The quality of salvage cars available at auction can fluctuate a lot, as there are several factors at play when it comes to how a vehicle can be declared salvage. Salvage laws differ from state to state, and the damage threshold for a salvage declaration can vary.

Additionally, cars that were stolen and later recovered are routinely declared salvage as well, even if they’re mechanically intact. Likewise, former taxicabs or police cruisers decommissioned after hundreds of thousands of miles of service are sometimes sold as salvage at auction as well.

Regardless of how your salvage car got the appellation, you’re barred from getting it back on the road legally until you trade in that “salvage” title for one that acknowledges that the car has been rebuilt or reconstructed. The majority of states require you to fill out a stack of paperwork and then present the repaired car to a facility where it will be inspected.

If your documents are in order and your car passes the inspection, you’ll receive a new title that’s stamped or branded “reconstructed” or “rebuilt.” It’s only when you have this in hand that you can register your vehicle once more.

Insure Your Investment

Finally, make sure you’ve got sufficient insurance coverage on your rebuilt vehicle. A minimum level of coverage will be required by your particular state – again, this will differ depending on where you live and where you want to register your vehicle – and for the most part you shouldn’t have much difficulty finding an insurer willing to work with you for base levels of coverage like personal liability insurance or property damage insurance.

However, you’re likely to run into trouble if you’re looking for physical damage coverage for your vehicle in the form of comprehensive insurance or collision insurance. You’re likely to be given price quotes that are quite high or even run into insurers that decline to offer you physical damage insurance at all.

This is due to your vehicle’s status as a rebuilt salvage car, as no insurer is comfortable with providing coverage to a vehicle that’s already been totaled, especially not sight unseen. One of the ways around this is to have your car subjected to yet another inspection – this time at the hands of an insurance agent – in order to document the condition of your car so there’s a baseline in the event that the car does end up in yet another accident.

After you’ve satisfied your insurer that the vehicle is in good condition, you’re likely to get a better price quote on that physical damage insurance.

Explore our Vehicle Auctions, as well as finding more information about How These Auctions Work.