[V8] Insurance for the salvaged car

Roger M. Woodbury rmwoodbury at downeast.net
Wed Jan 14 13:54:46 EST 2004

I hate insurance threads, but having worked in the insurance industry for
more years than I care to admit, and having handled more auto insurance
claims that I care to admit either, I will post my comments concerning
salvage titles.

There are basically three things that most insurance companies will use to
determine coverage.  Territory:  where the car is principally garaged;
driver's record; specific type of vehicle and the amount of coverage on it.
In general, everything else is just fluff.  Auto insurance is underwritten
by formula.  Either the little squares that are supposed to be black are
black, or the application is refused.  Most insurance companies do this by
machine, and there isn't even a "body" involved in the basic selection or
rejection process.

Why territory?  Well, that has mostly to do with driving conditions and
crime rates, AND that particular company's experience in that territory.
Insurance company are very careful to point out, that this alone is not a
THE factor.  That would be called "red lining", which is illegal.  Right.
They don't do it.  But Territory is a big, fat red flag, nonetheless.

Why the Driver's record?  You figure it out.  If someone has three speeding
violations in the past three to five years, the chances are that the driver
has a lead foot, and will have another accident.

Then there is the fact of coverage.  If you have a car that you want to
insure for liability only then that makes it easier, than if you expect to
have the car covered for physical damage loss as well.

A routine check of motorvehicle identification numbers....done by computer
again, probably....will reveal a salvage or other title defect.  Sometimes
it doesn't matter, especially if the car itself isn't being covered.
However, most companies aren't crazy about taking rebuilds under cover, and
they will point out that there are specialty markets for insuring this sort
of car, and they will point you cheerfully in  that direction.


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