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Buying Salvage Cars From Insurance Companies

insurance salvage automobile cars and vehicles

Can you insure a car with a salvage title?

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While most consumers typically purchase new or used vehicles from a dealership, a local dealer, or from family and/or friends, there are certainly going to be instances in which a salvaged vehicle with a matching salvage title is purchased. And once a car with a salvage title is purchased, unless it is going to be garaged or otherwise stored, the first matter of business will be to purchase an auto insurance policy for the vehicle.

However, vehicles with salvage titles are vehicles that are not deemed safe or suitable for driving on public roads. Because of this very important “sticking point”, a car with a salvage title cannot be insured. But there is a process in which a salvage vehicle can qualify for auto insurance.

It’s important to know what exactly a salvage title vehicle is. This type of vehicle has been written off as a “total loss”. This does not necessarily indicate that the original “clean” title is present; it simply means that the vehicle in question has suffered catastrophic damage that makes it beyond repair and thus a total loss. Or, the cost to repair the vehicle would exceed even as little as 60 percent of the vehicle’s estimated value.

But many salvage vehicles can be repaired to a point that there are safe and suitable to drive on public roads. Salvage vehicles are often a result of vehicle accidents, or even significant manufacturer-caused defects and/or recalls. But with the proper knowledge and equipment, a salvage vehicle can be purchased for as little as one hundred dollars, and it can then be repaired and refurbished to improve its condition enough that it can be driven on public roads. In fact, many salvaged vehicles may have as little as four tires and a new bumper standing between them and the open road.

In the event that a salvaged vehicle, which again is a vehicle that has been discarded in a junkyard or left in a towing company’s lot, is purchased and repaired enough to be suitable for the public roads, its owner can apply for what is called a rebuilt title. A rebuilt title is a declaration that a previously-salvaged vehicle has been repaired, rebuilt, tested, and inspected. It’s important to keep in mind that each state will have its own requirements and guidelines for issuing a rebuilt title to replace the salvage title on salvage cars. Also, a car that is salvaged and has been declared unfit for driving is exempt from any opportunity to “restore” the vehicle to rebuilt status.

With that new rebuilt title in hand, you can then pay for a policy to cover your road-ready whip. Of course, you may need to negotiate with your insurance company, as they will most often provide nothing more than a liability (often referred to as limited-liability) policy. With this type of policy, your insurance company will take responsibility for paying for the other party’s damages, but will not pay for yours. Insuring a salvage shouldn’t be an extensive process, but it can be if you are leading your auto insurance company blindly. Having plenty of documentation in hand means a shorter phone call and a higher success rate for you, and a liability-only insurance policy for your new-to-you ride.

The best way to go about insuring a salvage that is now rebuilt by purchasing a fair limited-liability auto policy for your salvaged, rebuilt titled vehicle is to contact your insurance company not just with your quote request, but with a certified statement of the sound mechanisms of the vehicle, pictures of the vehicle, and your repair estimates and actual repair costs. It can also help to provide your insurance company with copies of invoices and reports from your mechanic, written documentation of existing damage on your salvage cars, and photos of existing damage.

With this info and these numbers in hand, your auto insurance company will be able to offer you a low-cost, limited-liability-only vehicle insurance policy for your car. Insuring your salvage can save you financial and legal hassles in the event of an accident, so this is one step in the process of getting your rebuilt car back out on the road that you won’t want to miss.

If you are a mechanic, or you know a mechanic, or you’re simply good with tearing apart vehicles, consider purchasing a salvaged vehicle. Salvaged vehicles often cost mere pennies on the dollar, and you’ll have, at the very least, a lot of salvageable parts.

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