Sometimes vehicles get damaged to the point where the cost of repairing it, is worth more than its value. At this point an insurance company may have it auctioned, to sell parts that are still in good condition, or it can be sold to persons who will fix it back to working condition. In the latter case the vehicle is given a salvaged title. These vehicles may look, and be as road worthy as any new vehicle, and their cost may be significantly lower. However because of their history, it poses a factor of high risk and so insuring them requires more effort than the ordinary vehicle.
Insuring a salvaged Vehicle
Most insurance companies will only cover salvaged vehicles for liability coverages which are required by law. Liability coverage is the cost of protecting other motorists from damage done by your vehicle. Your salvaged vehicle will not be covered for any damages done to it. However, if they do provide comprehensive coverage for your salvaged vehicle, the premium might be very high, and you are required to provide proof of the value of the vehicle from a licensed appraisal dealer.
Tips to insuring your salvaged vehicle
Ensure that you give the correct information regarding the title of your vehicle. If you do not, then in the event of a claim this will be rejected because of misrepresentation. Also mention any no-claim discounts that you have from previous insurance companies, as this could lower your premium. State the correct information about your driving history, your age, the other persons that will be driving your vehicle, the area that you live in, and the job that you do. Get quotes from several companies, and ask if optional coverages are available, other than the state mandatory coverage. Check to see what the claim amount will be in the event of an accident, before you choose the particular company. The claim amounts could be significantly lower than normal, in the event of an accident because of its history, irrespective of the premium.
Ask that the risk be appraised in totality, and not just based on the fact that the vehicle has a salvaged title. If it is difficult to get insurance coverage from private companies, research the state run insurance companies that will have to offer coverage, once your documents are in place. Ensure that the correct information about the vehicle is given to the insurer, so that calculations on the premium can be correct. The premium may be higher than usual based on the history factor.