Salvage Title Insurance – What is it?
A salvage title is issued to a car when it is damaged to an extent, to which the repair will cost more than the value of the car before the damage. In such cases, the car will be given a salvage title by the insurance company.
Either the owner who wants to keep the car anyway or the insurer who claims the car after the accident has to apply for the salvage title. After being declared a salvage-titled car, it is not permitted to drive on the roads. The criteria to be a salvage car varies from one country to another.
How does the process work? :Salvage Title Insurance
When a car gets damaged to an extent, if more than 75%, then the car is declared a salvaged car. However, this percentage also varies. Some countries give salvage titles when the car is damaged up to 60%.
Damage may be in any form, like collision, fire, floods, etc. Salvage Title can also be given for a stolen car. After being declared a salvage car, the car cannot be driven on the road even after repair. Because even after repair we may not know the full damage that car has and what damage it can do if driven in public. The car’s value will be decreased by 20 to 40%.
What can you do?
If you want to buy a car with salvage Title because of its low price value or you already bought a salvaged car, you can do something to drive it back on the road.
Have the car checked thoroughly by the mechanic and know about the car completely before buying the car. Try fixing the car. But in most cases, it will be difficult as the car will be damaged severely. If you still manage to fix the car, there may be some unknown problem in the car that you may not know. Try getting a Rebuilt title for your car. A rebuilt title is given to a salvaged car that is fixed again and eligible to drive on the road. Still getting a Rebuilt title can be difficult. It is because your car will undergo a lot of inspections. After passing those inspections, the Rebuilt-title will be given to your car. After getting a Rebuilt title you have to get the insurance for the car. This is a tedious process as many insurance companies will not accept insure a previously salvage titled car, even though it is repaired now. You have to go to many insurance companies and compare. However, there is a chance of getting at least liability insurance for your car. If you don’t want to keep the car, you can sell it, or you can sell the parts of it in your local car junk.
Advantages and Disadvantages of buying a salvage-titled car:
There are many pros and cons of buying a salvage-titled car.
Advantages:
You may get a car for a lower price. There is a chance of repairing and restoring. You may find the spare parts at a lower cost.
Disadvantages:
Getting insurance is very difficult. You will not know the problem that is still there. It is because in many cases, the seller won’t tell you all the problems. It may lead to high repair costs, yet the car may still have problems.
Conclusion:
Many people don’t recommend buying a salvage-titled car, as it involves many difficulties. Consider the pros and cons, discuss with a good mechanic, and choose wisely. The laws for a salvaged title car vary according to state. Understand the law and policies of your government before buying a salvage title car. It is important to remember when you are driving you put other people at risk too.
What does liability coverage mean in car insurance?
Liability insurance will cover the expenses of medical treatment and any damage to public properties.
- What will liability insurance cover?
It will cover the medical expenses for those who caused the accident and those affected. It also covers any damage to the public property.
- How will I know whether the car I want to buy has a salvage title or not?
The methods will vary with the states and countries. A common way is to check with the Vehicle Identification Number of the car.
- What are the different titles that are given to a car?
Clear TitleSalvage TitleJunk titleReconstructed or Rebuilt TitleAffidavit title
