Differences Between Previous Damage Titles and Salvage Titles

The differences between previous damage and salvage titles have to do with repairs and insurance. A previous damage title means that the car has been repaired such that it is drivable. Salvage titles mean that the car has had little to no work done to repair it. A prior salvage title on a vehicle history report can usually only get liability insurance, which averages $43 a month, but you can compare salvage vehicles car insurance rates to get a better deal.

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Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Mar 30, 2021

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Here's what you need to know...

  • All motor vehicles in the United States are required to have some title documentation
  • If you’re buying a damaged car that’s had little or no repair work done to it, it will have a salvage title or salvage status
  • When a salvage car is rebuilt to the extent that can be put back on the road, it is then given a type of title called a previous damage title or a rebuilt title

What’s the difference between a previous damage title and a salvage title? A previous salvage title means a car is once again road-worthy and can be driven legally.

If you’re asking that question, you’ve probably been to an auto auction or searched for used cars in an automotive sales periodical.

It’s not uncommon to have confusion between the two vehicle titles, especially among average drivers and potential buyers who don’t normally deal with these kinds of cars.

All motor vehicles in the United States are required to have some title documentation. This document proves ownership of the vehicle. It’s also transferable from one owner to the next.

A title also contains information on possible lien holders; those who hold a financial interest in the vehicle due to providing a loan or other assistance to the previous owner towards its purchase.

It’s possible to get affordable salvage title car insurance. Shop around to find cheap car insurance, no matter the status of your title.

Enter your ZIP to compare online salvage title car insurance quotes in your area, whether you have a clean title, salvage title, or previous damage title.

What Are Salvage Title Cars vs. Previous Damage Titles?

What are the kinds of car titles? There are several types, although they sometimes are called different names. The main types are clean, salvage, and previous damage titles.

What does it mean to have a clean title? This simply means that the vehicle has never been declared a salvage or total loss.

What is the difference between salvage and rebuilt title or previous damage title?

In both cases, the car in question has received some damage significant enough that the car insurance company declared it a total loss.

In other words, it was less expensive for the insurance company to replace the vehicle than to have it repaired. Most commonly this sort of extensive damage is incurred during an accident.

According to Edmunds, a vehicle is usually declared a total loss if the damage is around 75 percent or more of the car’s worth. However, it’s important to note that each state will determine total loss differently.

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What does it mean when a car has a salvage title?

If you’re buying a damaged car that’s had little or no repair work done to it, it will have a salvage title. This doesn’t necessarily mean the car cannot be repaired. It just means that no repair work has been done.

So, what is the problem with a salvage title? The main problem is usually the extent and type of damage done to the vehicle. Some damages, like flood or extensive frame damage, will be costly to repair and can be dangerous if the repairs aren’t done correctly.

What does prior salvage title mean?

When a salvage car is rebuilt to the extent that can be put back on the road, it is then given a previous damage title. In some states, these documents are known as a rebuilt car title or a prior salvage title.

How does a previous damage title or a salvage title affect car insurance coverage?

The question of insurance for salvaged or rebuilt cars is an important one. It’s impossible to carry a traditional insurance policy on a damaged car.

Because insurance companies have no way of knowing how severe the damage was, the value of the vehicle is automatically considered to be significantly less than that of a similar, undamaged model.

That means a car with a previous damage title will have a much lower cash value if a circumstance dictates the insurance company replace it.

There is no way to insure a car with a salvage title. Once the repairs are made and the title is changed to previous damage or rebuilt, some insurance companies will allow you to purchase liability auto insurance coverage.

Check out this table that shows you the average cost of liability insurance by state. This will give you an idea of the cost of coverage. Use the box below to search for your state.

Average Annual Auto Insurance Rate for Liability Coverage by State
STATEAverage Annual Auto Insurance Rate for Liability Coverage
Alabama$372.57
Alaska$547.34
Arizona$488.59
Arkansas$381.14
California$462.95
Colorado$477.10
Connecticut$633.95
Delaware$776.50
District of Columbia$628.09
South Dakota$289.04
Florida$845.05
Georgia$490.64
Hawaii$458.49
Idaho$337.17
Illinois$430.54
Indiana$372.44
Iowa$293.34
Kansas$342.33
Kentucky$518.91
Louisiana$727.15
Maine$333.92
Maryland$599.48
Massachusetts$587.75
Michigan$722.04
Minnesota$439.58
Mississippi$437.38
Missouri$399.41
Montana$387.77
Nebraska$349.07
Nevada$647.07
New Hampshire$393.24
New Jersey$865.55
New Mexico$462.21
New York$784.98
North Carolina$357.59
North Dakota$282.55
Ohio$376.16
Oklahoma$441.57
Oregon$553.43
Pennsylvania$495.02
Rhode Island$720.06
South Carolina$497.50
Tennessee$397.73
Texas$498.44
Utah$471.26
Vermont$340.98
Virginia$413.12
Washington$568.92
West Virginia$501.44
Wisconsin$359.84
Wyoming$323.38
Countrywide$516.39
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Liability-only car insurance averages about $43 a month. Most insurers won’t sell you more than the basic liability insurance since the risk is too great.

Watch this video to learn more about liability insurance and what it covers.

Liability coverage is pretty inexpensive, but there are things you won’t be covered for, like damage to your car is you cause an accident.

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Should I stay away from a car with a previous damage title?

Is a rebuilt title a bad thing?

This depends a lot on the type of car and the repairs that have been done. Some cars with a lot of damage may not be able to be repaired to the point where they are similar to when they were new, but others may be fixed well enough.

When looking to buy a vehicle with a previous damage title, it is important to try to find out what the damage was and what parts of the car or truck were affected by the damage.

For example, if the damage was to the entire rear part of the vehicle, and the entire rear was replaced and repaired, it may be safe to purchase that vehicle.

However, if the damage was not completely fixed or addressed by repairs, you may choose not to move ahead with purchasing the vehicle.

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Can a previous damage title or salvage title ever be replaced with a standard one?

Either title will serve the purpose of making sure all subsequent owners of a vehicle are aware of any previous damage. Therefore, it is not possible to have either replaced with standard ones at any point in the future.

Some unethical sellers will move the vehicle from state to state to try to get a clean title so they don’t have to disclose the damage. This is called title washing and is illegal. Always run a report before buying a car to check for any damages.

This is one of the reasons that rebuilt wrecks are usually not restored. One exception to this rule is an undamaged car that might be found at a salvage yard simply because of its age.

For example, if muscle cars are wrecked but repairable, they can be stripped down and restored if they’re in good condition. Such cars can be given a clean title as long as they haven’t sustained significant damage.

Regulations regarding these types of situations are different from state to state, so it’s best to check with your motor vehicle department for specific details.

Although previous damage and salvage titles may seem to be a hassle, they are intended as protection for car buyers. Vehicles bearing this kind of title generally will require a larger financial investment.

Knowing this ahead of time is important in deciding whether or not a previously damaged car is right for you.

Need to buy salvage title car insurance? If you’ve purchased a previously damaged car, you can compare salvage title car insurance rates online by entering your ZIP now.

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