State Inspections

• Details vary by state, but generally you must repair and have a salvage vehicle inspected before it is allowed by law to be driven on the road. You won't be able to register the vehicle without first passing these conditions. The DMV, the state police or other agency, as determined by your state, must approve the vehicle's safety. Insurers won't write coverage for an illegal vehicle, so passing the required inspection is the first step to insure your salvaged car.
  
  

Liability Coverage

• Once your salvaged vehicle is street-legal again, you probably won't have too much trouble finding an insurer to write liability insurance on it. The company may want a copy of the state inspection report or may want to conduct an inspection of its own to verify the vehicle does not pose a hazard on the road, but many insurers will consider liability policies for these cars. Depending on your insurer's internal policies, you may pay a surcharge for a salvaged car.
  
  

Physical Damage Coverage

• You may have to try a bit harder to obtain physical damage coverage for the salvaged car. Comprehensive and collision insurance pays for damages to the car itself; so if it already has a history of major damage, some insurers may hesitate or refuse to insure the car for this coverage. This is not a uniform rule, however; so if you are persistent in your efforts to get full coverage, you will probably succeed. The insurer may have a special list of requirements for you, including additional inspections, so comply with whatever is needed to get the coverage.
  
  

Total Loss Settlements

• Cars with a salvage title are almost always worth less than the equivalent car with a clean title. While the amount of difference varies according to a number of factors, the variation can be as much as 50 percent, according to OnlineAutoInsurance.com. An auto insurance policy pasy based on the actual cash value of the insured car, so a total loss settlement may be significantly less than the average retail value of that vehicle. Keep in mind, though, that you will likely pay the same premiums as someone with a car that has a clean title.