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Salvaged Vehicles in Illinois

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Have a totaled car in Illinois? Chances are, you won’t maintain ownership BUT your insurance company has plenty of other options for you.

What Is a Salvaged Car in IL?

Basically, a salvaged car is one that’s been damaged so badly it would cost more to repair or rebuild the vehicle than it’s actually worth (i.e. it’s actual cash value). Often, auto insurance companies call a salvage car a “total loss” vehicle.

In general, insurance carriers require you to submit a sworn proof of loss within 91 days of the car becoming a total loss. You’ll need to include details like:

  • When the incident happened.
  • How it occurred.
  • Why your car was being used at the time.

There are several ways for you and/or your insurance company to handle a salvaged car; don’t hesitate to contact your auto insurance provider for details specific to your circumstances. 

Illinois Salvage Cars & Total Loss Claims

Once your insurance provider declares your car a salvage, they will take ownership of the vehicle and be responsible for obtaining a salvage certificate.

Then, your insurance company will replace your car OR offer you a settlement.

NOTE: You can only keep the car if it’s only been damaged by hail and is still safe to drive OR the car is at least 9 years old. If either of these situations pertain to you, contact the Department of Insurance at (312) 814-2427 or (866) 445-5364 to find out what your next steps are.

Replacing Your Salvaged Vehicle

If the insurance company replaces your totaled car, it must be:

  • With one of a similar make and model.
  • Purchased from a licensed dealer.
  • Under warranty if it’s 3 years old or less.

You have the option of rejecting the replacement vehicle, after which your insurance carrier must pay you what the replacement would have cost (including taxes, transfer fees, and title fees).

Insurance Settlements

For the settlement payment option, your insurance company will determine your vehicle’s retail value. HOWEVER, your Illinois insurance provider can make deductions up to $500 from the retail value based on any unrepaired damages (e.g. wear and tear, rust, missing parts, etc.).

After receiving a cash settlement, you’ll probably want to buy another car. Following the purchase, your auto insurance carrier may offer you additional help.

If you bought another vehicle within 30 days of the cash settlement, with a value:

  • Less than the settlement amount: Your insurance company must reimburse you for the full amount of sales tax, transfer fees, and title fees you paid on the new car.
  • More than the settlement amount: Your insurance provider will reimburse you for the sales tax, transfer fees, and title fees as applied to the settlement amount.

If you did NOT buy another vehicle within 30 days of the cash settlement because you couldn’t find one for your car’s determined retail value, BUT you found a similar car that costs more, your insurance company MIGHT do one of the following:

  • Pay you the difference between the settlement and the more expensive vehicle.
  • Try to negotiate a lower price for the car, and possibly purchase the vehicle for you.
  • Find a similar (but different) vehicle for the determined market value.
  • Conclude the settlement (the specifics of which depend on the appraisal section of your insurance policy).

If you have questions about cash settlements following the total loss of a vehicle, call the Illinois Department of Insurance at (866) 445-5364 for assistance.

Junking a Car in Illinois

If you come to the conclusion that the cost of repairing your car is much greater than the actual value of your car, you might decide to junk it.

If you go this route, you’ll need to apply for a junking certificate within 15 days. You can do this either before or after transferring your vehicle to a junkyard or dealer; however, if you choose to do it after, you’ll need to obtain a uniform invoice with the business’ information, among other details, and provide that—along with the vehicle’s title and an application form—to the Secretary of State.

For a full run-down of what you’ll need to do, contact your local SOS office.

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