Owning or buying a car with a salvage or rebuilt title can offer a unique set of rewards, but doing so also comes with a unique set of car insurance considerations. For starters, you typically need to make sure the vehicle is certified for road use before an insurance company will even consider covering it. Here’s what you need to know about getting insurance for a car with a salvage or rebuilt title.
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Can I get insurance for a car with a salvage title?
In general, you can typically only get car insurance for a vehicle with a salvage title after it is repaired, passes a state-authorized safety inspection and has its title upgraded to rebuilt status.
Rebuilt title vs. salvage title
The specific terms used for branded titles as “salvage” and “rebuilt” vary slightly by state, and it’s important to understand how they affect your ability to insure and legally drive a vehicle.
Salvage title: A car branded with a salvage title with no further descriptor is typically banned for use on public roads and not insurable.
- Cars usually receive a salvage title when they are declared a total loss after an accident, fire, flood or other event that results in repair costs that exceed the car’s value. In certain situations, a stolen vehicle may also receive a salvage title.
- In some states, a salvage title accompanied by the words “parts-only” or “junk” means the car has been determined to be irreparable and can only be sold for scrap.
Rebuilt title: After you repair a salvage vehicle and have it pass a state-authorized safety inspection, you can apply to have the vehicle’s title upgraded to rebuilt status.
- It’s important to find out how your state defines a “rebuilt” vehicle. Texas uses the term “prior salvage” to denote rebuilt status. In California, rebuilt cars have the words “revived salvage” printed on their title certificate, while New York uses the term “Rebuilt Salvage: NY.”
- Once your vehicle’s title is upgraded to your state’s “rebuilt” designation, you’ll be able to drive it legally on public roads, provided you meet your state’s registration requirements. These requirements usually include obtaining car insurance.
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How can I get insurance for a car with a rebuilt title?
While it is possible to get insurance for a car with a rebuilt (or salvage-rebuilt) title, doing so may require a little more legwork than it normally takes for a car with a clean title.
You should still compare quotes from multiple companies to make sure you get the best rate. Just be aware that some companies don’t insure cars with rebuilt titles, and others place limitations on the coverages they offer.
As you shop, you may find it easier to get the basic coverages required in your state than it is to add collision and comprehensive coverages. Some companies may require documentation of your vehicle’s repairs or their own vehicle inspection.
Here are a few steps you can take to simplify your search.
Ask an insurance agent for help
While some people prefer the convenience of online shopping, it may be more convenient to ask an insurance agent for help insuring a car with a rebuilt title.
Insurance agents often have access to products and services that are not readily available online to the general public. An agent may help you get insurance from a lesser-known company that accepts rebuilt vehicles or insures them at cheaper rates.
Insurance companies that cover cars with rebuilt titles
If you’re not sure where to begin in your search for insurance for a car with a rebuilt title, here are a few companies to consider contacting for help.
- American Family
- State Farm
- The General
- 21st Century
Be upfront about your vehicle’s title status
When discussing a quote or application on the phone, in an online chat or in person, let the agent or company representative know about your car’s title status at the beginning of the conversation.
The agent should be able to let you know whether their company insures rebuilt cars right away. If they don’t insure them, just move on to the next company on your list.
Provide your VIN
Most insurance companies only need your vehicle’s year, make and model number to provide a quote. However, they will eventually run your car’s vehicle identification number (VIN) through their databases to confirm your information, including your vehicle’s title status.
Providing your VIN at the beginning of the process allows you to get an accurate estimate of your rate, or find out if you even qualify, before you sink too much additional time into an application.
How does a salvage or rebuilt title affect insurance?
Cars with salvage or rebuilt titles affect insurance by posing risks that some companies don’t accept and other companies only cover at higher rates than available for cars with clean titles.
The vehicle data that insurance companies maintain allows them to accurately estimate the value and repair costs of cars that come out of factories in uniform condition.
However, the value and repair costs of rebuilt cars vary by vehicle, depending on factors such as the severity of the damage that led to their salvage designation and the quality of the parts and workmanship that went into rebuilding them.
The lack of uniformity in rebuilt cars makes it harder for insurance companies to accurately estimate the costs of insuring them. This makes some insurance companies avoid rebuilt cars altogether and others charge high rates to insure them.
Meanwhile, even after a rebuilt car passes a state safety inspection, it may still contain a hidden defect or damage that could contribute to an accident. This creates another potential risk for insurance companies to consider as they set rates for rebuilt cars, or decide whether to cover them at all.
Regardless of how skillfully they are repaired, rebuilt cars tend to have lower market values than comparable ones with clean titles. If you get full coverage for a rebuilt car that is subsequently totaled in an accident, your insurance payout is likely to be lower than it would be if the car had a clean title.
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Should I get a car with a salvage or rebuilt title?
If you’re buying a car with a salvage or rebuilt title, it’s best to get car insurance quotes ahead of time to make sure you can insure the vehicle at an affordable price. You usually only need to provide the VIN and a few other details about the car and yourself to get reasonably accurate price estimates.
If you’re not sure about a vehicle’s title status, you can run the VIN through the free online NICB VINCheck, provided by the National Insurance Crime Bureau. The site lets you see if the car has previously been issued a salvage title.
Frequently asked questions
You can usually get full-coverage car insurance for a vehicle with a rebuilt title, but it may be harder to find and more expensive than getting full-coverage for a comparable car with a clean title.
In some states, a salvage vehicle receives a blue title, which refers to the color of paper used to print its title certificate. Paper colors vary by state. Regardless of paper color, a title certificate should also denote any special designations, such as a vehicle’s “salvage” or “rebuilt” status, in bold letters across the top of the document.
A salvage title is typically issued to a vehicle that has been declared a total loss and banned from public roads. A rebuilt title is given to a salvage vehicle that has been restored and state-approved for use on public roads. In some states, terms such as “salvage rebuilt” or “prior salvage” denote “rebuilt” status.
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