Salvage Title
Title brand applied to a vehicle declared a total loss by an insurer.
Definition
A salvage title is a title brand issued by a state DMV after an insurer or owner declares a vehicle a total loss. The brand records that the vehicle sustained damage or repair costs that met the state's total-loss criteria at least once in its history.
Why it matters in a total-loss claim
In a total-loss claim, the salvage-title outcome is what triggers the insurer's obligation to pay actual cash value. It also determines what happens to the vehicle itself: the insurer usually takes ownership of the salvage and disposes of it at auction, or the owner can elect owner-retained salvage and keep the car with the salvage brand attached.
Example
A 2020 sedan with $12,000 in collision damage and a pre-loss ACV of $14,000 in a state that uses an 80% threshold would be totaled. The state DMV re-issues the title with a 'Salvage' brand. If the owner keeps the vehicle, they receive ACV minus the salvage value and cannot drive the car on public roads until it passes a state safety inspection and is re-branded 'Rebuilt' or 'Reconstructed'.
Common confusion
A salvage title is not the same as a rebuilt title. Salvage means the vehicle has been declared a total loss and is not road-legal until inspected. Rebuilt (see below) is the post-inspection brand that lets it return to the road. Both brands stay on the title history permanently.
Source
NHTSA — Vehicle Titling and Registration Overview
Related terms
- Rebuilt Title — Title brand for a previously salvaged vehicle that passed state inspection and returned to road use.
- Comparable Sales (Comp Sales) — Recent sales of similar vehicles used to establish actual cash value.