Insurance for Cars with Rebuilt Titles

You can insure a car with a rebuilt title, but special rules apply and coverage can be more expensive. Find out how rebuilt titles affect insurance and what companies cover them.
Car being rebuilt in shop

Did you buy a salvage vehicle and rebuild it? Are you looking to buy a used car? If this is you, you’ll have to deal with rebuilt titles. Also, depending on its claim history and current condition, you could have a hard time getting car insurance.

Insuring a car with this title branding can be tough because there are many unknowns. Providers don’t know how badly damaged or how safe the vehicle is. And that’s a risk some companies are unwilling to accept.

This article will teach you about rebuilt titles and other passenger vehicle brands. It’ll also teach you how to buy an auto insurance policy for one. This includes:

  • Salvage vs. rebuilt titles
  • What types of coverage are available
  • How much more it costs to insure rebuilds
  • What insurance companies cover rebuilt titles
  • Frequently asked questions

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Salvage vs. Rebuilt Titles

There’s a lot of confusion about the difference between salvage and rebuilt titles. They’re similar because they both involve totaled vehicles. Here’s a quick definition of each type of title and how they differ:

What Are Rebuilt Titles?

A vehicle branded “rebuilt” was once declared a total loss by its insurance company and branded as a salvage. This designation means the car is undrivable until it meets safety requirements and passes an inspection. Once repaired and declared roadworthy, it receives a state-assigned rebuilt title.

States often have different requirements for certification. Some may require an inspection, while others could only require it to go through a checklist, such as in Washington state. Be sure to check with your state’s laws on totaled vehicles to learn how or if you can sufficiently repair yours to get one.

Here are some steps that you might need to carry out to obtain a revived or rebuilt salvage title:

  • Get the car sufficient repairs to be drivable
  • File the appropriate papers with your state (i.e., applications, forms, etc.)
  • Save receipts. States like Georgia require proof of major improvements
  • You need to schedule an inspection if your state requires it (check state requirements)

What Are Salvage Titles?

A salvage title means that your car is a total loss, but you haven’t repaired or “rebuilt” it to be roadworthy. This differs from other branded vehicles where the state deems them street-legal. You can’t legally drive one of these cars. Because of that, it’s impossible to insure one. Repairing it to the point where a state will grant you a rebuilt title is the only way to drive it.

Most people only buy a salvage car with the intent to restore it. This is something to consider if you’re thinking about buying one. Be aware that some sellers may try to hide the fact that a vehicle has a salvage title and pass it off as a clean title. Use caution when buying a used car to avoid this.

What Are Branded Titles?

You might see the term “branded” when you read about rebuilds and salvages. A brand reflects the type of damage that your car has sustained during its lifespan. They’re more of a category than a type of title. Branding can affect what types of coverage your vehicle qualifies for. Examples of branded titles include:

  • Rebuilt
  • Salvage
  • Water damage
  • Hail damage
  • Lemon
  • Odometer rollback

Title brands may vary from state to state. It’s best to check with your state’s Department of Motor Vehicles (DMV) to know what title brands it uses.

Can You Insure a Rebuilt Title?

In most cases, you should be able to insure reconstructed vehicles. According to Zachary Schneiderman, president of Schneiderman Insurance Agency in Granada Hills, California, “Insurance companies want a car to be roadworthy.” This means your car has passed all state inspections and has a valid title. “Rebuilt titles may be rejected, but it’s not common,” says Schneiderman.

Some providers, such as PEMCO, don’t offer coverage options to owners of rebuilds. That’s because they’re unsure of how bad the damages were. It’s also because these vehicles are a potential safety risk.

When you do get coverage for your rebuild, you should have no problem getting basic liability insurance. This is the minimum amount of coverage that most states require to drive. Liability kicks in when you’re at fault in an accident. It protects you from the following:

  • Property damage, such as light posts, trees, buildings, etc.
  • Bodily injury, such as medical bills, funeral costs, long-term care, etc.

The problem with having a previously wrecked vehicle is that you may be unable to get full coverage insurance. This complete coverage package includes collision and comprehensive. These coverages protect you from the following:

  • Natural disasters
  • Theft
  • Vandalism
  • Hitting an animal
  • Collisions where you’re not at fault

Per Schneiderman, you may be limited to a liability-only policy because “the car may not be worth much.” A rebuilt title car’s worth takes a drastic hit because of its accident history. Keep in mind that state laws and insurers’ preferences for insuring rebuilds apply.

How Rebuilt Title Insurance Works

For the most part, there isn’t anything special about insuring cars with rebuilt titles. There’s the possibility you’ll be limited to a liability-only policy. Not only that, but you’ll probably pay more than you would for a comparable vehicle with a clean title. Next, we’ll look at pricing and which companies provide coverage.

Does It More?

Some estimates indicate that it costs as much as 20% more to insurance rebuilds than clean titles. Even so, many other elements affect your rates. Here are some of the primary factors that providers consider:

All of the above will affect your auto insurance rates. But remember that insurers look at your claims history and driving record the most when they set your rates. If you’ve filed claims or received traffic tickets recently, your auto insurance won’t be cheap.

Providers also have misgivings about a former salvage car’s safety and mechanical concerns. But in the end, you’ll most likely get coverage if the vehicle passes safety tests and the state deems it as “roadworthy.” But note that you’ll have higher rates than someone with the same car. Rebuilt cars simply cost more to insure.

Just because you have to pay more doesn’t mean you have to shell out more than you need to. It’s wise to shop around and compare auto insurance rates to find the best deal.

What Insurance Companies Cover Rebuilt Titles?

If you recently purchased a rebuild and wonder which companies insure them, don’t despair. Most insurers accept rebuilds, with a few exceptions. And many others limit coverage to liability-only policies. Even so, most providers will still cover a rebuilt salvage car once it’s repaired and certified.

These are some of the most popular national insurers that cover these cars.

Note: each insurance provider has unique requirements and restrictions, including state availability.

Frequently Asked Questions

Should you buy a car with a rebuilt title?

The short answer is that it depends. People commonly buy cars with rebranded titles because they want to get a good deal. Sadly, they usually pay extra for auto insurance later on. These vehicles are cheap to buy but cost more in the long run.

Remember to be careful of cars with salvage titles as well. These vehicles are not drivable. To be able to drive it, you’d have to restore the car. Unfortunately, car restorations are expensive and time-consuming.

Does a rebuilt title affect my car’s resale value?

If your car is branded as a rebuild, it can negatively affect your it’s resale value. According to Kelley Blue Book, a “rebuilt” on a car’s title can decrease its value by about 20-40%. It’s because buyers don’t want to deal with a car that was a total loss. They may also worry about potential insurance costs in the future.

Does a rebuilt title affect insurance?

Having “rebuilt” on your title affects your insurance in several ways. First, while you’ll probably find coverage for your newly fixed-up car, getting more than liability coverage is less common. The reason for this is that insurers consider rebuilds more likely to get into an accident that result in a claim. It doesn’t matter how safe a driver you are when your vehicle’s title has a “rebuilt” brand on its title.

You can also expect to be at odds with your carrier about your car’s value. It doesn’t matter how much money you throw into it—it’s a rebuild, and everyone will know it. Unfortunately, that will never change since title brands are permanent.

Which insurers cover vehicles with reconstructed vehicles?

Almost every insurance company offers at least liability coverage to rebuilt salvage vehicles. However, each provider has unique rules and requirements you must satisfy before it writes you a policy. Some of the major insurers only offer liability for rebuilds. Others may offer more coverage, but you should ask your agent or contact your carrier directly for more information.

Can you get full coverage insurance on a rebuilt title?

Most companies cover rebuilt cars, but they may not offer full coverage insurance policies. The reason is that it’s harder for insurers to know whether damage to a vehicle after an accident is new. The damage could be from a pre-existing crash. It’s hard to know for sure. And that’s reason enough for providers to be hesitant when it comes to cars with branded titles.

Do cars with rebuilt titles cost more to insure?

Yes, they often do cost more because of the car’s accident history. Insurance companies can access accident histories through your car’s vehicle identification number (VIN). When your car was previously a total loss, it raises safety concerns for an insurer, even after it passes inspections.

Then, there’s the matter of a vehicle’s actual cash value (ACV). Your car loses value with “rebuilt” on the title. But you’ll be charged full price for coverage. Paying more while getting less is part of the price you pay for driving a rebranded car.

Are rebuilt titles better than salvage?

In a contest between salvages and rebuilds, the latter wins every time. First, you can register and drive a vehicle with a rebuilt salvage title, whereas salvaged cars are little more than twisted hunks of metal. It also means that rebuilds are worth more and have a higher KBB value than salvages. One last factor that makes rebuilds better than salvages is that you can insure the former.


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