Salvage Vehicle Title - Insurance Question

[kc27]

In another thread, I posted that my vehicle had been damaged in an accident. The (other driver's) insurance company offered two options: less money and I keep the car or more money and they keep the car.

I kept the car and had it repaired by a professional autobody technician. The damaged was more cosmetic than anything else. A few people have mentioned to me that because the car was considered a total loss by the insurance company, that the state (Wisconsin) will issue a salvage title for the car. Does that sound correct? How does this work? Do insurances companies report VINs to the DMV alerting the DMV as to which vehicles the insurance companies have deemed total losses? Once they have this information, does the state then reissue the title as "salvage".

I am going to ask my insurance agent about this, but was wondering if anyone had any expertise in this area that they could share.

[Boll weevil]

Depends on the state. Looks like Wisconsin doesn’t require a salvage title be issued if the car is more than seven years old. 

[kc27]

Depends on the state. Looks like Wisconsin doesn’t require a salvage title be issued if the car is more than seven years old.

That's how I interpreted Wisconsin's DMV dalvage title definition (posted below). I began wondering about this question because a few people mentioned to me that salvage titles were issued when these three things happen:

1. An insurance company determines the cost of repairing a vehicle is more than the vehicles value.
2. The vehicle owner accepts a financial settlement and keeps the car.
3. The insurance company then notifies the state of the settlement, and that triggers the state to issue a salvage title.

If that is the case, it is what it is. I did not realize that a salvage title was a possibility when I was deciding whether to replace or repair the car. The vehicle I had repaired was a 2005 Pontiac Vibe that had rear door and quarter panel damage. It was still driveable. I had it inspected after the accident and it had no alignment issues.

Salvage vehicle - A vehicle less than seven years old that is not considered junk and damaged by collision or other occurrence (other than from hail damage) to the extent that the cost of repairing the vehicle is more than 70% of the fair market value. Or, a vehicle of any model year last titled in another jurisdiction with a salvage brand.

[Boll weevil]

I think it’s something the claim rep you’ve been dealing with should have mentioned, but the provision has been around so long that they probably assume everybody knows.

Usually most of the value of the car is gone after seven years so that it doesn’t take much to total out a car, and the state doesn’t want to be doing paperwork on a whole bunch of cars with little value.

For instance, I had a car totaled in 2008. IIRC, the insurance company said the value of the car pre-crash was $1400, and it would have cost them $1800 to fix it. The rep who I was dealing with then was who told me about old cars not needing a salvage title.

[researcher1]

A few people have mentioned to me that because the car was considered a total loss by the insurance company, that the state (Wisconsin) will issue a salvage title for the car. Does that sound correct? How does this work? Do insurances companies report VINs to the DMV alerting the DMV as to which vehicles the insurance companies have deemed total losses? Once they have this information, does the state then reissue the title as "salvage".

I don't understand how any state could possibly enforce this.

I am in possession of clean/valid/official titles for my two nearly new vehicles.
If one of them is "totaled", how could the state institute a salvage title?
Are they going to come to my house and demand I hand over my clean title?

[Boll weevil]

A few people have mentioned to me that because the car was considered a total loss by the insurance company, that the state (Wisconsin) will issue a salvage title for the car. Does that sound correct? How does this work? Do insurances companies report VINs to the DMV alerting the DMV as to which vehicles the insurance companies have deemed total losses? Once they have this information, does the state then reissue the title as "salvage".

I don't understand how any state could possibly enforce this.

I am in possession of clean/valid/official titles for my two nearly new vehicles.
If one of them is "totaled", how could the state institute a salvage title?
Are they going to come to my house and demand I hand over my clean title?

I don’t know how the process works exactly but would guess a few scenarios:

1. They simply send you a salvage title along with a letter saying the one in your possession is now void.

2. They refuse to renew your license plates via mail or online and insist you bring your current title in so they can replace it with a salvage title.

3. They flag it in the system and the new owner receives a salvage title when registering the vehicle.

4.  They rely on the honor system, just like how you’re required to update the address on your drivers license or register your car in state within a certain period of time.

[robartsd]

I am in possession of clean/valid/official titles for my two nearly new vehicles.
If one of them is "totaled", how could the state institute a salvage title?
Are they going to come to my house and demand I hand over my clean title?

No, they wont come confiscate your out of date paperwoork, but they'll send you the updated title and keep a record. You might be able to sell to someone for cash signing over using the outdated clean title; but when they apply to get the title in their name, they will find out that the title is not a clean title and might take you to small claims court over it.

[kc27]

My wife dealt the the insurance company for this accident, so I asked her to follow up with the insurance company representative that paid the claim, and ask them if the car will have a salvage title. She then asked me, "Don't you remember? You asked me to check with them about that before we accepted the settlement. They said the car would not have a salvage title."

So on one hand, I am glad the title question is answered. On the other hand, I wonder what is happening to my mind. Forgetting about a discussion that involved an insurance settlement and a title status is a really big gear to slip. I think I need to start meditating again, get back to daily exercise, or or do something.

Thanks everyone for your ideas. Sorry to have wasted your time on this.