August 27, 2019

Rebuilt Title

Read more about Car Insurance

Buying a car with a rebuilt title can save you a lot of money. But how will it affect your insurance? Keep reading to learn all about insuring vehicles with rebuilt titles.

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There are three types of car titles:

  • Clean Title is for a car that has never been totaled.

  • Salvaged Title is given to a car that has been declared a total loss ("totalled"). This means the vehicle cannot be registered or legally driven.

  • Rebuilt Title is for a salvaged car that has been rebuilt.

How does a car get a rebuilt title? Read on.

A car's title is a legal document proving ownership of a vehicle. It contains important information about the vehicle, including:

  • VIN
  • Mileage at the time of sale
  • Owner information
  • Lender liens

What does a Rebuilt Title Mean?

To get a rebuilt title, a vehicle must be repaired to the point that it is fully functional. It typically must pass a state inspection before it can be sold and driven.

The state inspection helps prove that the vehicle is fit for the road. But while all rebuilt titles meet the requirements from the state, the quality of each rebuild can vary.

This is partly what makes rebuilt titles risky for insurance companies. Some rebuilds make the car almost as good as new, while others aren't very reliable in the long run.

Read on to see how you can get a rebuilt title insured.

Get a rebuilt title fully inspected by a trusted and certified mechanic. They will be able to fully determine the quality of the rebuild. It's also a good idea to check the history of any used car through companies that sell this information.

Insuring Salvaged & Rebuilt Titles

Insurance companies are hesitant to insure salvaged vehicles since it can be difficult to trust the condition of the vehicle. Unless you can prove the car is in good shape through one or two fully certified mechanics, then the company will assume otherwise.

Companies that provide coverage typically offer two options:

Liability Only
This pays for bodily injury to a third party that is caused by an at-fault accident.

Full Coverage
Some larger national companies provide comprehensive and collision coverage. This will cover any damage done to the vehicle itself as a result of:

  • A collision
  • Fire
  • Storm
  • Theft
  • Acts of nature

Many insurance companies will actually require an additional inspection on a car with a rebuilt title to verify its condition.

How To Get Full Coverage on a Rebuilt Title

To purchase full coverage on a rebuilt title, you'll likely need to provide an inspection report that proves that the car is fully operational.

The inspection report also helps the company determine the value to insure the car for. If the insurance company agrees to full coverage, expect them to insure the car for up to 50% less than a similar car with a clean title.

The cost of full coverage will vary since rates are based on:

  • The likelihood of the vehicle being involved in another accident

  • Whether the vehicle has been properly rebuilt and passed all inspections

  • Whether or not it is fully operational

  • The value of the rebuilt vehicle

What to Do When Buying a Rebuilt Car

Buying rebuilt titled cars is less expensive than buying new cars with clean titles. But it also carries more risk.

Here are a few simple ways to protect yourself.

  1. Get an Inspection
    To make sure that the car is safe and can meet your driving demands, get an inspection report from 1–2 trusted professionals.

  2. Obtain Documentation
    Get a written valuation of the car. Otherwise, the insurance company will use their own valuation, which could potentially be less.

  3. Find an Insurance Company
    Not all insurance companies will insure a rebuilt title. If you want full coverage, you'll likely have to go through a larger, national insurance company.

Bottom Line

If you're looking for insurance on a rebuilt titled vehicle, it is important to shop around for insurance. Be sure to compare multiple insurance companies since each may handle rebuilt titles differently.

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What Should I Be Paying for Car Insurance

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