How and why would someone buy a damaged car from an insurance company?

Why would someone buy a damaged car from an insurance company? My brother said he bought a beat-up car this weekend that a local insurance company sold him. I get that it was cheap, but it seems like a bad idea.

Answer
Buying a salvaged vehicle isn’t for everyone, but if you are handy with cars and have a little time on your hands, it can be a financially savvy move!
When cars are deemed totaled by a car insurance company, a salvaged title is issued and the vehicles are sold at auction. By auctioning the vehicle, insurance companies can make some of their money back
You’re right—it can be dangerous to drive a salvaged car, which is why it is illegal to have them on the road. They can only be driven once they pass all state requirements and receive a rebuilt title.
Once he has the rebuilt title, your brother can apply for liability insurance. Most insurers do not provide collision coverage for salvaged cars.
When your brother is ready to find insurance for his salvaged car, tell him to give Jerry a try! Jerry pulls quotes from up to 50 top insurers, including those that work with salvaged vehicles, for you to compare (and for free!).
Shannon Martin
Answered on Oct 21, 2021
Shannon is an expert in personal lines liability insurance with 13 + years of insurance industry experience. She also served as a special insurance liaison to AARP members for 6 of those years. She is a graduate of UL Lafayette and currently resides in NY with her family. Shannon is also an amateur juggler, ukulele player, and is a time travel paradox theory enthusiast.
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