Hurricane Considerations and the Construction Industry: Pssst - Wanna Buy a Pickup Truck?
Thursday, October 12, 2017
Posted by: AEMP
Considering adding additional on-road vehicles to your fleet in the near future? Here's how to avoid salvage fraud.
This hurricane season has been wrecking havoc in the South, and besides washing out Texas and Florida neighborhoods, hurricane's Harvey and Irma have also left behind a whole new crop of water-damaged vehicles, some of which will make their way to the used vehicle market. According to The Weather Channel, at least 325,000 flood-damaged vehicles were made salvage by Harvey and Irma.
(photo from WikiMedia / Creative Commons)
To help consumers steer clear of a disaster vehicle, the National Insurance Crime Bureau (NICB) offers information and free assistance for potential buyers to avoid getting cheated by unscrupulous sellers of water damaged vehicles.
What NICB Does
After a disaster, NICB works with its member companies, law enforcement and auto auction companies to identify the vehicles that have had an insurance claim filed and to process them for sale.
All of the cars and light trucks that are deemed to be a total loss by an reputable insurance company will be retitled with the Department of Motor Vehicles and the new title will indicate the fact that the vehicle has been flood damaged. Most of the vehicles are sold to parts’ companies who will dismantle them and re-sell usable parts that were not damaged by the flooding.
However, vehicles that were not insured may be cleaned up and put up for sale by the owner or an unscrupulous dealer, cleaned up, then taken out of state where the Vehicle Identification Number (VIN) is switched. The newly retitled vehicle is put up for sale with no indication on its paperwork that it has been damaged.
According to Consumer Reports, about 15 percent of drivers in Texas have no vehicle insurance and 25 percent of those who are insured do not carry optional comprehensive insurance.
NICB offers a free data checking site called VINCheck where buyers can cross-reference a vehicle's VIN against the NICB database that tracks information submitted by insurance companies as to whether the vehicle has been declared as salvage, stolen or unrecovered. NICB says 88 percent of the country's insurance companies submit their information to the database.
Additionally, information from the National Motor Vehicle Title Information System (NMVTIS) database is merged into the VINCheck program. NMVTIS is a nationwide government database that state DMVs, insurance companies, and salvage yards are required by law to report a vehicle's history.
A NICB sister for-pay program to VINCheck is VinAudit that provides current and historical title records. Again, National Motor Vehicle Title Information System (NMVTIS) data is included in the VinAudit database.
Getting the historical title information is vital. A car or truck with flood damage that may not have caused an insurer to declare the vehicle salvage can be retitled to read 'Rebuild.' And, not all states require a retitled vehicle to carry a "Flood" or "Salvage" stamp. With the historical information, you can at least determine if the car or truck has resided in a disaster area.
The organization says other vehicle background check services such as Carfax do not include the NMVTIS data.
For heavy commercial trucks, RigDig offers a VIN checking service that can be purchased by report or on a subscription basis.