Excerpts from Some 570,000 vehicles were damaged during the two hurricanes. There'sa risk that many could be retitled and then resold to unknowing buyersall around the country.The problem of "title washing" - retitling vehicles to remove the redflags or "brands" that indicate the car or truck has been damaged in acollision or a natural disaster - isn't new. For instance, it'spossible to move a car that has been totaled - and had that factmarked on the title - into another state and obtain a new, cleantitle. The vehicle can then be resold or run through an auction, wherea car dealer could buy it for sale on the used-car lot. Compounding the problem is that states don't have uniform definitionsof terms used to flag the kind of damage done to vehicles, and theydon't have consistent practices when it comes to providing titleinformation to vendors that sell title information to dealers andconsumers. The lag time between when a title is recorded or revisedand when that information becomes available can be as much as twomonths. Insurance companies should be required to make thevehicle-identification numbers of vehicles that are totaled availableto the public.The NADA has tried and failed to get tougher anti-title-washinglegislation at the national level. Some state motor vehicle agenciesaren't necessarily in favor of giving away valuable data or makinginvestments in data systems to provide real-time access just so afor-profit vendor like CarFax can make more money. The vehicle-repairindustry isn't necessarily in favor of titling rules that would makeit impossible to resell a rebuilt car.In the aftermath of the Katrina tragedy, consumers should beware. TheNADA, the National Insurance Crime Board and car makers are trying tomake it harder for hurricane-damaged vehicles to find their way intoconsumer's driveways. Car makers are killing thevehicle-identification numbers of vehicles damaged on dealer lots,which should make it impossible to retitle those cars. The NICB...

This is the first moment I've realized that the danger extends to newcars too if they're shuffled among ethically challenged dealers. Itshould have been evident, but somehow it wasn't. I guess my sense oftrusteworthiness dates to a gentler time.Thank you for posting, Steve.Brent

Flood-damaged cars being sold?

Oct 10, 2005 26 Replies

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Brent Secombe 20 years ago

Unless one is the party involved, it's easy and tempting to imagine the worst. I'm confident your expectations are met in many instances, but I also believe they're not the norm.

Happily, I have scant personal data. My wife's Subaru Forester gave its life to save hers. Outwardy the damage looked fixable, but on closer examination it was clear that the forward crumple zone had crumped its little heart out. Its designers, engineers and builders deserve medals.

Our insurer, AMICA, offered to sell us the carcass for $300 but I declined the opportunity. BTW, the settlement was very satisfactory -- right down to paying us the state sales tax on the car's pre-event value.

We took the money and bought a Prius. We hope we'll never learn how it crumps. :-)

Brent

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Hachiroku 20 years ago

I dunno...around here the adjusters meet you in a parking lot, your house, wherever. Usually the body shop owner doesn't know the adjuster, they rotate them around so this type of thing is rare.

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Mike Hunter 20 years ago

$500 is a high deductible for comprehensive coverage. Generally comprehensive deducible is offered at $100, $50, and zero, the rates between which are small, for $500 the premium is much lower.

mike hunt

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Mike Hunter 20 years ago

$500 is a high deductible for comprehensive coverage. Generally comprehensive deducible is offered at $100, $50, and zero, the rates between which are small, for $500 the premium is much lower.

mike hunt

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Steve 20 years ago

Yes, but you're talking about individuals, not dealerships. Been a while since I've looked at this, but I'd expect a large dealership to carry a physical damage deductible of at least $100,000. Dealers with several locations might well decide to self-insure physical damage, depending on where in the up/down pricing cycle the insurance industry is at the moment...

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Mike Hunter 20 years ago

Any dealer worth his salt will carry millions in damage loss insurance on the buildings and vehicles, but still needs a low comprehensive individual deductible for damage for vandalized, wind, hale storm, etc., damaged vehicles. One need not carry flood insurance on a vehicles, just on the physical realestate.

mike hunt

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Steve 20 years ago

I'm afraid you don't understand much about commercial insurance.

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