What form of title must an insurer obtain in connection with the sale of
a total loss vehicle?
When an insurance company makes a payment of damages on a total loss
claim for a vehicle, the insurance company shall be deemed to be the owner
of such vehicle and the vehicle shall be considered to be salvage except that
ownership of a vehicle 9 model years of age or older may, by agreement
between the registered owner and the insurance company, be retained by
the registered owner of such vehicle. The insurance company (or Copart,
acting as agent for the insurer under a power of attorney) shall promptly
deliver or mail within 20 days the certificate of title along with proper
application and fee to the Secretary of State, and a salvage certificate shall
be issued in the name of the insurance company. [See 625 Illinois Compiled
Statutes 5/3 – 117.1(b)(1)]
An insurer making payment of damages on a total loss claim for the theft of
a vehicle may exchange the salvage certificate for a certificate of title if the
vehicle is recovered without damage. In such a situation, the insurer shall
fill out and sign a form prescribed by the Secretary of State which contains
an affirmation under penalty of perjury that the vehicle was recovered
without damage and the Secretary of State may, by rule or regulation,
require photographs to be submitted. [See 625 Illinois Compiled Statutes
5/3-117.1(b)(1)] back to top
What documents must an insurer provide to Copart in order to sell a
vehicle on a Salvage Certificate?
The insurer shall provide Copart with a Certificate of Title or a comparable
ownership document issued by another state or jurisdiction (either endorsed
over to the insurer or accompanied by a power of attorney), an odometer
disclosure statement, a release of any liens, and an ACV. Please note that
Illinois has detailed and complex requirements regarding powers of
attorney. Please consult your Copart facility in Illinois for guidance on
using the appropriate power of attorney for your situation.
Copart will submit these documents along with an Application for Vehicle
Title – Salvage Certificate and the appropriate fee to the Secretary of State
for processing.
Thereafter, the Secretary of State shall issue a Salvage Certificate in the
name of the insurer.
Copart, acting under a power of attorney for the insurer, will then sell the
vehicle at auction and reassign the insurer’s Salvage Certificate to the
purchaser. [See 625 Illinois Compiled Statutes 5/3-117.1(b)(1), 5/3-118] back to top
What documents must an insurer provide to Copart in order to sell a
recovered theft vehicle recovered substantially intact with no
substantial damage, where title is still in the name of the insured?
When a vehicle has been stolen, the insurer shall provide Copart with a
Certificate of Title or a comparable ownership document issued by another
state or jurisdiction (either endorsed over to the insurer or accompanied by
a power of attorney), an odometer disclosure statement with last known
mileage, a release of any liens, and an ACV. Please note that Illinois has
detailed and complex requirements regarding powers of attorney. Please
consult your Copart facility in Illinois for guidance on using the appropriate
power of attorney for your situation.
After receipt of these documents, Copart will submit these documents along
with an Application for Vehicle Title – Salvage Certificate and the
appropriate fee to the Secretary of State for processing.
Thereafter, the Secretary of State shall issue a Salvage Certificate in the
name of the insurer. Upon receipt, Copart will forward the Salvage
Certificate to the insurer for safekeeping.
If the vehicle is recovered, the Salvage Certificate along with an ACV, a
cost of repair, and a police report will be returned to Copart by the insurer
in order to obtain the appropriate title depending whether the vehicle is
damaged or not. If the vehicle is recovered without damage, the Salvage
Certificate may be exchanged for a Certificate of Title. In such a situation,
the insurer shall provide a letter and a police report which states that the
vehicle was recovered without damage, and the Secretary of State may, by
rule or regulation, require photographs to be submitted. If the vehicle is
recovered with damage, the vehicle will remain on a Salvage Certificate.
Copart, acting upon a power of attorney for the insurer, will then sell the
vehicle at auction and reassign the insurer’s Salvage Certificate or
Certificate of Title to the purchaser. [See 625 Illinois Compiled Statutes
5/3-117.1(b)(1), 5/3-118] back to top
What steps must an insurer take in Illinois to process an ownerretained vehicle?
Pursuant to 625 Illinois Compiled Statutes 5/3-117.1(b)(1):
(b) An application for a salvage certificate shall be submitted to the
Secretary of State in any of the following situations:
(1) When an insurance company makes a payment of damages on a total
loss claim for a vehicle, the insurance company shall be deemed to be the
owner of such vehicle and the vehicle shall be considered to be salvage
except that ownership of a vehicle 9 model years of age or older may,
by agreement between the registered owner and the insurance
company, be retained by the registered owner of such vehicle. The
insurance company shall promptly deliver or mail within 20 days the
certificate of title along with proper application and fee to the Secretary of
State, and a salvage certificate shall be issued in the name of the insurance
company. An insurer making payment of damages on a total loss claim for
the theft of a vehicle may exchange the salvage certificate for a certificate
of title if the vehicle is recovered without damage. In such a situation, the
insurer shall fill out and sign a form prescribed by the Secretary of State
which contains an affirmation under penalty of perjury that the vehicle was
recovered without damage and the Secretary of State may, by rule or
regulation, require photographs to be submitted. back to top
What legal duties are imposed upon a lienholder following satisfaction
of the lien?
Following satisfaction of lien, the lienholder must, within ten (10) days
after demand and, in any event within thirty (30) days, execute a release of
his security interest, and mail or deliver the Certificate of Title and release
to the next lienholder named therein, or, if none, to the owner or any person
who delivers to the lienholder an authorization from the owner to receive
the Certificate of Title. [See 625 Illinois Compiled Statutes 5/3-205(a) back to top
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