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If you are thinking about buying a car with a salvage title or already have one, you may be wondering how to get auto insurance for salvage vehicles. By definition, a car will have a salvage title if an insurance company declares it a total loss. With a salvage title, you cannot drive the car or find insurance for it. Salvage vehicles are repaired and then inspected. Once they pass the inspection, they can qualify for a rebuilt title. Then, you can register, drive, and insure a vehicle like this.
Our team took the time to review all of the best car insurance providers in the industry, then gathered that information in a convenient way for you to use. This process included creating a user-friendly quote box. Once you enter your zip code, you will have auto insurance quotes from local providers at your fingertips.
Salvage Car Vs. Rebuilt Title
A salvage title refers to a car that an insurance company declares a total loss. This will happen if the cost of repairs to the vehicle would be more than the insurance company thinks is worth spending on the car. Generally, this is the case if the repairs would cost about 75% to 90% of the vehicle’s value, or more.
That damage can occur from a natural disaster or after an accident. An example would be flood damage to a car.
In that case, the insurance company will typically give its client a settlement in exchange for the vehicle title. The insurance company will then sell the salvage title car to a dismantler that takes it apart for parts or takes it to a repair facility.
If it goes to a repair facility, they can rebuild the vehicle. It is important to note that any rebuilt vehicle has to pass a careful inspection before it is deemed safe to be driven. Its title will also show that it was rebuilt from a salvaged vehicle. This way, buyers know the car’s history.
It is important to note that the average person cannot get a salvage car. These types of cars are sold in auctions to salvage yards or rebuilders.
Additionally, a private seller cannot sell a salvage vehicle. Private parties can, however, buy or sell a rebuilt vehicle. This is only possible after it has passed various tests to confirm that the car is safe to drive.
Insurance companies do not offer coverage for salvage vehicles because you can’t drive them on public roads. However, many insurers do offer coverage for rebuilt vehicles.
To make it easier for buyers to discover the history of a vehicle they are thinking of buying, most states add an element of color-coding to vehicle titles. The general rule of thumb is that if the title is green, the title is clean. If it is blue, it is a salvage title. If it is orange, it is a rebuilt title that was formerly a salvage vehicle.
How Do I Get Rebuilt Salvage Title Car Insurance?
The process of getting auto insurance for salvage vehicles after they have been rebuilt is similar to the process for any other car. You will want to shop around and compare your coverage options. You can talk to insurance agents and insurance companies or use comparison tools like our quote box. Comparing prices and coverage is crucial to getting the best deal.
Just keep in mind that it is much harder to get comprehensive coverage or collision coverage for a rebuilt title than for a normal car. Many companies will only offer liability insurance, as this is the minimum coverage required in most states.
That said, if the extent of the damage to the rebuilt vehicle was not too severe, some companies may offer comprehensive or collision coverage. This will vary case-by-case and company-by-company, but you should not expect it from vehicles with significant damage.
Before buying a rebuilt car, you should also keep in mind that insurance is more expensive for a rebuilt vehicle than one with a clean title.
Should I Get a Rebuilt Salvage Car?
Deciding whether to get a rebuilt title car is a personal choice that only you can make. There are both positives and negatives to this decision.
The most obvious benefit is that you will save money upfront due to the car’s value being low. A rebuilt car will cost less to buy than one with a clean title. Sometimes, the savings can be significant. Regardless of whether it sounds like a great deal or not, it is always advised that you remember to check the market value of a used car on Kelley Blue Book before buying.
However, you want to think about the long-term cost of buying a rebuilt salvage car. While you will spend less on the initial purchase, your insurance policy premiums will be higher. This can add up over time. It is also quite likely that you will be unable to get full coverage, or more than just liability coverage. This potentially puts you at greater financial risk if you are in an accident.
If you do decide to buy a rebuilt salvage title, you should always ensure you do so from a trusted seller. Remember that private individuals can sell rebuilt cars. That means that you may face scams or unscrupulous sellers. At the very least, you will want to check the title and vehicle history to confirm the extent of the vehicle´s original damage.
How to Tell if a Car Has a Rebuilt Title
As mentioned, not all sellers have honorable intentions. This means that some sellers may purposely avoid mentioning that the car has a rebuilt title. This is a common tactic among sellers who care more about making money than being honest, as they know they should charge less for a rebuilt car.
The good news is that you have a few simple methods up your sleeve to check whether a car has a rebuilt title. We already mentioned one, which is the color of the title. If the title is green, it should be clean. If it is rebuilt, it will be orange. A salvage title is blue, and you should not legally be able to buy it.
The other method of checking if a car is rebuilt is with its VIN (vehicle identification number). You can use the National Motor Vehicle Title Information System to search for the VIN. The results will show you the vehicle history, including information about its title.
Ideally, you want to check the vehicle history for any used car you buy whether you suspect it has been rebuilt or not, so this should already be on your checklist.
If you somehow buy a car with a rebuilt title without realizing it at the time, you will quickly find out when you go to get insurance coverage. Car insurance companies will always check the title status and vehicle history as part of the process of providing you with an auto insurance quote. If you don’t tell the company that the auto has a rebuilt title and the company discovers that it does, it may cancel your coverage altogether.
Of course, it’s best to learn a car has a rebuilt title before buying it, because if you don’t discover the fact until you apply for insurance, you will have already paid for the vehicle. More importantly, you likely will have paid more than you should have if you didn’t realize it has a rebuilt title.
Our Recommendations for Auto Insurance
After our extensive research, our team can confidently recommend GEICO, USAA, and State Farm to any driver, regardless of whether or not you have a rebuilt salvage title. Remember that you should always compare quotes to get the best value and coverage. Our quote box is easy to use and lets you instantly compare free quotes without any obligations.
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GEICO: Best Overall
Our extensive testing led to GEICO earning a 9.8 out of 10.0 rating for industry reputation, an 8.5 for coverage, a 9.4 for cost, and a 9.0 for customer experience. This results in an overall average rating of 9.1.
USAA: Best Military Provider
USAA earned a 9.3 for industry reputation and customer experience, a 9.5 for coverage, and a 10.0 for cost. This led to an overall rating of 9.6.
State Farm: Best Student Discounts
State Farm earned a 9.9 for industry reputation, an 8.8 for customer experience, and a 9.0 for coverage and cost. The provider earned an overall rating of 9.1.
What insurance company covers rebuilt salvage cars?
Most companies cover rebuilt salvage titles. Some of the insurance companies that offer coverage for salvage titles include 21st century, Infinity, National General, Progressive and Titan.
Can salvage cars be insured?
Usually, you cannot insure a salvage title vehicle because it is not considered to be roadworthy. Once the car is rebuilt, you can then apply for car insurance.
Are salvaged cars more expensive to insure?
Yes, a salvage or rebuilt car will be more expensive to insure.
Is it hard to insure a salvage car?
It is difficult to insure a salvage car if it is not rebuilt. Rebuilt salvage cars can be insured, but it is still more challenging than insuring a car with a clean title.