How to Insure a Car With a Salvage Title in Texas

by Wilhelm Schnotz ; Updated July 27, 2017

In Texas, insurance companies may often total a car, then turn it over to a scrap dealer with a salvage title when the cost of repairing damage suffered to it exceeds its value before the accident. Because of this, many salvage dealers are able to receive late-model cars with minimal damage and repair them, then sell them with a salvage title. While savvy car buyers might be able to purchase a reliable vehicle with a salvage title, insuring it may be difficult as insurance companies may be hesitant to determine its actual value and its safety rating.

Step 1

Determine the vehicle’s value by having it appraised by a professional appraiser. Because salvage-title vehicles are typically worth over 40 percent less than standard Kelley Blue Book value, determining your vehicle’s worth is key in helping an insurance company determine its value.

Step 2

Hire a professional mechanic examine the car’s safety features to determine how roadworthy it is. Many insurers are reluctant to insure a salvage-title vehicle because they don’t have reliable information on how safe it is for passengers as well as other vehicles. Speak with a representative from your insurance company regarding the procedure to determine the vehicle’s safety rating.

Step 3

Pass the Texas Department of Motor Vehicles vehicle inspection. You’ll need a valid inspection to register your vehicle, and a vehicle that passes inspection is more likely to be viewed favorably by insurance companies.

Step 4

Document the vehicle’s safety rating, appraised value and inspection report and submit it to your insurance company.

Tips

  • Shop around for rates. It’s common for insurers to charge higher rates for salvage title vehicles, despite their lower value.

Warnings

  • Don't purchase a car with a "nonrepairable" title if you intend to rebuild it and fix it. The Texas Department of Transportation deems these cars too damaged to be made roadworthy, only approved to be distributed for parts, not fixed and returned to the streets.

About the Author

Wilhelm Schnotz has worked as a freelance writer since 1998, covering arts and entertainment, culture and financial stories for a variety of consumer publications. His work has appeared in dozens of print titles, including "TV Guide" and "The Dallas Observer." Schnotz holds a Bachelor of Arts in journalism from Colorado State University.