If a vehicle is purchased as salvage and then it damaged in collision how the insurance value determined?

If a vehicle is purchased as salvage and then damaged in a collision, the insurance value will be determined based on the actual cash value (ACV) of the vehicle at the time of the collision. ACV is defined as the amount it would cost to replace the vehicle with one of similar age, condition, and mileage.

When determining ACV, several factors are considered, including:

* *The year, make, model, and condition of the vehicle*

* *The mileage on the vehicle*

* *The vehicle's history, including any previous accidents or repairs*

* *The current market value of similar vehicles*

* *The cost of parts and labor to repair the vehicle*

If the ACV of the vehicle is less than the cost of repairs, the vehicle may be declared a total loss. This means that the insurance company will pay the ACV of the vehicle to the insured, and the insured will keep the salvage.

If the ACV of the vehicle is greater than or equal to the cost of repairs, the insurance company will pay the insured the cost of repairs, and the insured will keep the vehicle.

It's important to note that when purchasing a salvage vehicle, it's crucial to have it thoroughly inspected by a qualified mechanic to assess the extent of the damage and to ensure that it's safe to drive. Additionally, salvage vehicles may be more difficult to insure, and some insurance companies may charge higher premiums or offer coverage with certain restrictions and exclusions.