What does a salvage title mean?

Salvage title meanings apply to any vehicle declared a total loss by an insurance company after an accident or collision. It can be worth buying a salvage vehicle because they often cost 20%-40% less than clear title vehicles, but you may have a hard time finding auto insurance for a salvage title.

Free Auto Insurance Comparison

secured lock Secured with SHA-256 Encryption

Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

Full Bio →

Written by Rachel Bodine
Feature Writer Rachel Bodine

Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

Full Bio →

Reviewed by Daniel Walker
Licensed Auto Insurance Agent Daniel Walker

UPDATED: Apr 29, 2022

Advertiser Disclosure

It’s all about you. We want to help you make the right coverage choices.

Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

Things to Remember

  • Salvage title meanings apply to any vehicle that is declared a total loss by an insurance company
  • No insurance company will provide coverage to salvaged vehicles
  • To buy auto insurance for a salvage vehicle, the vehicle must be repaired and pass a state inspection

If your vehicle has a salvage title, that means it was declared a total loss by your insurance company after an accident or collision. Insurance companies do not insure salvage titles because salvage vehicles are not legally fit to be driven. 

However, once a salvage car is repaired and inspected, it will earn a rebuilt title and be eligible for liability and full coverage auto insurance.

Is it worth buying a vehicle with a salvage title? Sometimes, yes, because a salvage car is cheaper than a new or used car. Keep reading to learn the advantages vs. disadvantages of a salvage title meaning and how to get a salvage title cleared so you can buy auto insurance for your vehicle.

If you’re looking for affordable salvage title insurance, enter your ZIP code above to start comparing auto insurance quotes from local companies for free.

What does a salvage title mean?

There are different types of vehicle title brands. The salvage title meaning applies to damaged vehicles that were declared a total loss by the insurance company. The salvage title meaning and color are meant to alert buyers and insurance companies that the vehicle was previously damaged.

This table explains the salvage title meaning and the meanings of other types of titles:

Types of Vehicle Titles

Vehicle Title DetailsClean TitleSalvage TitleRebuilt Title
Issuing FactorsIssued for new or used vehicles with little to no damageIssued for vehicles whose damages exceed the value of the vehicleIssued for vehicles that were salvaged but have been repaired and passed an inspection
ProsNo damage or repairs to deal withUsually very cheap to purchaseCheaper than a new or used car to purchase
ConsMost expensive upfront costNo insurance available, can't be driven legally, and repairs can be costlyCan be driven legally but can be hard to find more than liability insurance
Color of TitleGreenBlueOrange
Get Your Rates Quote Now

Compare RatesStart Now →

Typically, a salvage title vehicle was involved in a major accident, or collision, and the repair costs surpassed the car’s value. Salvage titles can also apply to vehicles with flood or water damage and heavily-used taxicabs and patrol vehicles.

Can you drive a vehicle with a salvage title?

No, because salvage titles are not eligible for auto insurance. If you’re looking to buy auto insurance for salvage vehicles, you will have to make all the necessary repairs and apply for rebuilt titles.

Can you register a salvage title?

Yes, if you own a salvage vehicle, you must register it with your state. In general, you will register it through your local DMV, but each state will have a different process and registration costs. 

Is a salvage title bad?

If you’re looking for a road-ready vehicle, then a salvage title isn’t in your best interest. You can’t buy insurance for a car with a salvage title, so you can’t drive that car until it’s repaired and deemed eligible for coverage.

But this doesn’t mean a salvage title is bad. Salvage titles aren’t lost causes and you may find a salvage title that isn’t too costly to repair. 

Remember, a total loss means that repairs cost more than what the insurance company thinks a vehicle is worth. Your budget may be more flexible than the insurance companies’. So, it’s important to weigh your options and compare auto insurance rates before you decide to buy a salvage title car.

How do I clear a salvage title?

Clearing a salvage title requires extensive repairs and passing a state inspection. Where you live will determine how you clear a salvage title since each state has different laws regarding vehicle inspections. 

Once your vehicle is repaired and passes inspection, you will have to apply for a rebuilt title and new vehicle registration with your state’s DMV. Application processes will vary by state. 

For example, in Texas drivers must fill out two forms: 1) an Application for Texas Certificate of Title, and 2) a Rebuilt Vehicle Statement. Once the applications are processed, the salvage title meaning in Texas will change to “Rebuilt Salvage – Damage.” With this new title, drivers can now buy liability-only auto insurance.

To learn the specifics of how to clear a salvage title in your state, contact your local DMV.

Free Auto Insurance Comparison

Enter your ZIP code below to view companies that have cheap auto insurance rates.

secured lock Secured with SHA-256 Encryption

Which auto insurance companies cover salvage titles?

No auto insurance company will offer coverage to a salvage title vehicle. There is no such thing as salvage title insurance. Any place selling you a salvage title policy is committing auto insurance fraud

If you need salvage title insurance, you need to repair your vehicle and apply for a rebuilt title. Insurance companies are more likely to insure a rebuilt title. The table below shows what you could pay for auto insurance with a rebuilt title:

Auto Insurance CompanyLiability-Only RatesFull Coverage Rates
American Family$114$224
State Farm$120$235
Get Your Rates Quote Now

Compare RatesStart Now →

Most of the top auto insurance companies provide liability-only policies for rebuilt titles. Still, you may have difficulty finding a company willing to provide full coverage.

Is it worth buying a car with a salvage title?

Deciding to buy a car with a salvage title is nothing to walk into lightly. Salvage titles come with cheaper price tags, often 20%-40% less than a used vehicle with a clear title. Most people who buy salvage titles use them for parts. 

However, no insurance company will write a policy for a salvage title, whatever the vehicle’s condition or the cost of the repairs. So, you cannot legally drive a salvage vehicle until you have the vehicle repaired and inspected for a rebuilt title.

Enter your ZIP code below if you’re ready to compare auto insurance quotes for salvage, rebuilt, and clear title vehicles. We will help you compare quotes from multiple local companies for free.

Free Auto Insurance Comparison

Enter your ZIP code below to view companies that have cheap auto insurance rates.

secured lock Secured with SHA-256 Encryption