Those who have already dealt with an auto insurance company to get a working auto insurance policy for a vehicle know a lot of what's involved in negotiating this kind of agreement, but getting salvaged car insurance for a vehicle with a salvage title is a little different in some ways.
Talk to the Insurer about Value
One of the major reasons that many auto insurance companies will not cover a salvaged title vehicle is that a car or truck with a salvaged title presents a bit of a mystery in terms of its actual value. Auto insurance works on specific principles of value. Everything from the auto body to the engine is thoroughly matched with a set of values that leads to specific insurance premiums and coverages. For a salvaged title vehicle, because past damage affects the market price so much, you can run into problems with insurers rejecting coverage for a vehicle because they can't identify its value.
Because of this issue, you may have to call around a little to find an insurer who will write you a policy on your salvaged title car or truck. You may need to provide that insurer with a professional appraisal for the vehicle in order to deal with the question of auto value.
Prove Safety Standards for Your Salvaged Title Vehicle
Another reason that insurers may want to reject a vehicle, or may charge higher premiums based on a salvaged title, has to do with vague notions of safety. An auto insurer’s underwriting department may arbitrarily determine that a salvaged title vehicle represents a safety risk, simply because they're not presented with proof that that vehicle will perform just as well as one that has not previously sustained damage. In these cases, the same professional appraisals can provide your proof of safety for vehicle, to allow it to receive standard insurance rates.
Talk about Claim Payouts
Some drivers who are able to successfully set up an auto insurance policy for a salvaged title vehicle are unpleasantly surprised later, when in a claim situation, the auto insurance company simply won't pay out because they consider the salvaged title vehicle to have no real value. To avoid these kinds of situations, agree on theoretical claims payouts up front when the deal is made, and be sure the payout you get on a claim will merit your monthly premium payments.
Car owners who have purchased salvaged title vehicles have to be especially vigilant about the tendency of auto insurers to over-emphasize their own risks. In some cases, quoted premiums for a salvaged title vehicle are excessively higher than those for a normal vehicle. In reality, the premium payments should be smaller, since the auto insurance company most likely won’t have to pay out full market values if the vehicle is wrecked. Some thorough negotiation will fix a lot of these misunderstandings, but drivers who take salvaged title insurance at face value may be paying far too much to remain on the road in their bargain vehicle.