What form of title must an insurer obtain in connection with the sale of
a vehicle that has been acquired through the settlement of a claim?
Excerpts of pertinent Missouri state laws addressing salvage and junk
vehicles are set forth below:
"Junk vehicle": a vehicle which is incapable of operation or use upon
the highways and has no resale value except as a source of parts or
scrap, and shall not be titled or registered.
“Salvage vehicle”: a motor vehicle, semitrailer, or house trailer
which:
(a) Has been damaged to the extent that the total cost of repairs to
rebuild or reconstruct the vehicle to its condition immediately before
it was damaged for legal operation on the roads or highways exceeds
seventy-five percent of the fair market value of the vehicle
immediately preceding the time it was damaged;
(b) By reason of condition or circumstance, has been declared
salvage, either by its owner, or by a person, firm, corporation, or
other legal entity exercising the right of security interest in it;
(c) Has been declared salvage by an insurance company as a result
of settlement of a claim for loss due to damage or theft;
(d) Ownership of which is evidenced by a salvage title; or
(e) Is abandoned property which is titled pursuant to section
304.155, RSMo, or section 304.157, RSMo, and designated with the
words 'salvage/abandoned property'.
The total cost of repairs to rebuild or reconstruct the vehicle shall not
include the cost of repairing, replacing, or reinstalling inflatable
safety restraints, tires, sound systems, or any sales tax on parts or
materials to rebuild or reconstruct the vehicle. For purposes of this
definition, 'fair market value' means the retail value of a motor
vehicle as:
a. Set forth in a current edition of any nationally recognized
compilation of retail values, including automated databases, or from
publications commonly used by the automotive and insurance
industries to establish the values of motor vehicles;
b. Determined pursuant to a market survey of comparable vehicles
with regard to condition and equipment; and
c. Determined by an insurance company using any other procedure
recognized by the insurance industry, including market surveys, that
is applied by the company in a uniform manner;
[See Missouri Statutes, TITLE XIX, Chapter 301, § 301.010(22)&
(50)]
Pursuant to an August 20, 2004 bulletin issued by the Missouri
Department of Revenue Division of Motor Vehicle and Drivers
Licensing:
[A]n insurance company may apply for an original certificate of title,
if it has acquired a motor vehicle, trailer, or all-terrain vehicle as a
result of a settlement of a claim for loss due to damage in which the
vehicle damage is less than that of a salvage vehicle. To qualify, the
total cost to repair the damage to the unit must be 75 percent or less
of the pre-damaged fair market value.
Insurance companies that are unable to obtain a certificate of title
from claimants, can obtain a title per Missouri Statutes, TITLE XIX,
Chapter 301, § 301.193:
1. Any person who purchases or is the owner of real property on
which vehicles, as defined in section 301.011, vessels or watercraft,
as defined in section 306.010, RSMo, or outboard motors, as that
term is used in section 306.530, RSMo, have been abandoned,
without the consent of said purchaser or owner of the real property,
may apply to the department of revenue for a certificate of title. Any
insurer which purchases a vehicle through the claims adjustment
process for which the insurer is unable to obtain a negotiable title
may make an application to the department of revenue for a salvage
certificate of title pursuant to this section. Prior to making
application for a certificate of title on a vehicle under this section,
the insurer or owner of the real estate shall have the vehicle
inspected by law enforcement pursuant to subsection 9 of section
301.190, and shall have law enforcement perform a check in the
national crime information center and any appropriate statewide law
enforcement computer to determine if the vehicle has been reported
stolen and the name and address of the person to whom the vehicle
was last titled and any lienholders of record. The insurer or owner or
purchaser of the real estate shall, thirty days prior to making
application for title, notify any owners or lienholders of record for
the vehicle by certified mail that the owner intends to apply for a
certificate of title from the director for the abandoned vehicle. The
application for title shall be accompanied by:
(1) A statement explaining the circumstances by which the property
came into the insurer, owner or purchaser's possession; a description
of the property including the year, make, model, vehicle
identification number and any decal or license plate that may be
affixed to the vehicle; the current location of the property; and the
retail value of the property;
(2) An inspection report of the property, if it is a vehicle, by a law
enforcement agency pursuant to subsection 9 of section 301.190; and
(3) A copy of the thirty-day notice and certified mail receipt mailed
to any owner and any person holding a valid security interest of
record.
2. Upon receipt of the application and supporting documents, the
director shall search the records of the department of revenue, or
initiate an inquiry with another state, if the evidence presented
indicated the property described in the application was registered or
titled in another state, to verify the name and address of any owners
and any lienholders. If the latest owner or lienholder was not notified
the director shall inform the insurer, owner, or purchaser of the real
estate of the latest owner and lienholder information so that notice
may be given as required by subsection 1 of this section. Any owner
or lienholder receiving notification may protest the issuance of title
by, within the thirty-day notice period and may file a petition to
recover the vehicle, naming the insurer or owner of the real estate
and serving a copy of the petition on the director of revenue. The
director shall not be a party to such petition but shall, upon receipt of
the petition, suspend the processing of any further certificate of title
until the rights of all parties to the vehicle are determined by the
court. Once all requirements are satisfied the director shall issue one
of the following:
(1) An original certificate of title if the vehicle examination
certificate, as provided in section 301.190, indicates that the vehicle
was not previously in a salvaged condition or rebuilt;
(2) An original certificate of title designated as prior salvage if the
vehicle examination certificate as provided in section 301.190
indicates the vehicle was previously in a salvaged condition or
rebuilt;
(3) A salvage certificate of title designated with the words
"salvage/abandoned property" or junking certificate based on the
condition of the property as stated in the inspection report. An
insurer purchasing a vehicle through the claims adjustment process
under this section shall only be eligible to obtain a salvage certificate
of title or junking certificate. back to top
What documents must an insurer provide to Copart in order to sell a
vehicle on an Original Certificate of Title?
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, and a release of any liens.
Copart will submit these documents along with an Application for Original
Certificate of Title (DOR-108), Certification by Insurance Company of
Vehicle Damage (DOR-5042), and the appropriate fee to the Department of
Revenue – Motor Vehicle Bureau for processing.
Thereafter, the Department of Revenue – Motor Vehicle Bureau shall issue
an Original Certificate of Title 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 Original Certificate of Title to
the purchaser. [See Missouri Statutes, TITLE XIX, Chapter 301, §§
301.227(1), 301.010 (50); August 20, 2004 bulletin issued by the Missouri
Department of Revenue Division of Motor Vehicle and Drivers Licensing] back to top
What documents must an insurer provide to Copart in order to sell a
vehicle on a Salvage Certificate of Title?
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, and a release of any liens.
Copart will submit these documents along with an Application for Salvage
Certificate of Title (DOR-108) and the appropriate fee to the Department of
Revenue – Motor Vehicle Bureau for processing.
Thereafter, the Department of Revenue – Motor Vehicle Bureau shall issue
a Salvage Certificate of Title 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 of Title to
the purchaser. [See Missouri Statutes, TITLE XIX, Chapter 301, §§
301.227(1), 301.010 (50); August 20, 2004 bulletin issued by the Missouri
Department of Revenue Division of Motor Vehicle and Drivers Licensing] back to top
What documents must an insurer provide to Copart in order to sell a
vehicle on a Junking Certificate of Title?
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, and a release of any liens.
Copart will submit these documents along with an Application for Junking
Title of Title (DOR-108) and the appropriate fee to the Department of
Revenue – Motor Vehicle Bureau for processing.
Thereafter, the Department of Revenue – Motor Vehicle Bureau shall issue
a Junking Certificate of Title 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 Junking Certificate of Title to
the purchaser. [See Missouri Statutes, TITLE XIX, Chapter 301, §§
301.227(2)&(3), 301.010(22), 12 CSR 10-23.355; August 20, 2004 bulletin
issued by the Missouri Department of Revenue Division of Motor Vehicle
and Drivers Licensing ] 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?
Notwithstanding the provisions of subsection 1 of this section, an insurance
company which settles a claim for a stolen vehicle shall be issued a
negotiable salvage certificate of title without the payment of any fee upon
proper application within thirty days after settlement of the claim for such
stolen vehicle. However, if the insurance company upon recovery of a
stolen vehicle determines that the stolen vehicle has not sustained damage
to the extent that the vehicle would have otherwise been declared a salvage
vehicle pursuant to subdivision (50) of section 301.010, then the insurance
company may have the vehicle inspected by the Missouri state highway
patrol, or other law enforcement agency authorized by the director of revenue, in accordance with the inspection provisions of subsection 9 of
section 301.190. Upon receipt of title application, applicable fee, the
completed inspection, and the return of any previously issued negotiable
salvage certificate, the director shall issue an original title with no salvage
designation. Upon the issuance of an original title the director shall remove
any indication of the negotiable salvage title previously issued to the
insurance company from the department's electronic records. [See Missouri
Statutes, TITLE XIX, Chapter 301, §§ 301.227(8)]
______________
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 police report of the theft, and a release of any liens.
After receipt of these documents, Copart will submit these documents along
with an Application for Salvage Certificate of Title (DOR-108) and the
appropriate fee to the Department of Revenue – Motor Vehicle Bureau for
processing.
Thereafter, the Department of Revenue – Motor Vehicle Bureau shall issue
a Salvage Certificate of Title in the name of the insurer. Upon receipt,
Copart will forward the Salvage Certificate of Title to the insurer for
safekeeping.
If the vehicle is recovered and if the total cost to repair the damage to the
vehicle is 75% or less of the pre-damaged fair market value, the insurer can
apply for an Original Certificate of Title. The insurer will return to Copart
the Salvage Certificate of Title and Vehicle Examination Certificate (DOR-
551) completed by the Missouri State Highway Patrol or the St. Louis City
or County Auto Theft Unit.
Thereafter, Copart will submit these documents along with an Application
for Original Certificate of Title (DOR-108) and the appropriate fee to the
Department of Revenue – Motor Vehicle Bureau for processing.
Thereafter, the Department of Revenue – Motor Vehicle Bureau shall issue
an Original Certificate of Title in the name of the insurer.
If the vehicle is recovered and if the total cost to repair the damage to the
vehicle is more than 75% of the pre-damaged fair market value, the insurer
returns the Salvage Certificate of Title to Copart.
In both instances, Copart, acting upon a power of attorney for the insurer,
will then sell the vehicle at auction, reassign the insurer’s Salvage or
Original Certificate of Title (depending upon the damage) to the purchaser.
[See Missouri Statutes, TITLE XIX, Chapter 301, §§ 301.010(50)(c);
301.227(8); August 20, 2004 bulletin issued by the Missouri Department of
Revenue Division of Motor Vehicle and Drivers Licensing ] back to top
What steps must an insurer take in Missouri to process an ownerretained vehicle?
Every insurance company which pays a claim for repair of a motor vehicle
which as the result of such repairs becomes a reconstructed motor vehicle
as defined in section 301.010 or which pays a claim on a salvage vehicle as
defined in section 301.010 and the insured is retaining ownership of the
vehicle, shall in writing notify the claimant, if he is the owner of the
vehicle, and the lienholder if a lien is in effect, that he is required to
surrender the certificate of ownership, and the documents and fees required
pursuant to subsection 4 of this section to obtain a reconstructed motor
vehicle certificate of ownership or documents and fees as otherwise
required by law to obtain a salvage certificate of ownership, from the
director of revenue. The insurance company shall within thirty (30) days of
the payment of such claims report to the director of revenue the name and
address of such claimant, the year, make, model, vehicle identification
number, and license plate number of the vehicle, and the date of loss and
payment.
NOTE: The Notice of Salvaged Vehicle Titling Requirement form (DOR-
5043- Attachment B) may be used for notification purposes.
[See Missouri Statutes, TITLE XIX, Chapter 301, §§ 301.020(5); August
20, 2004 bulletin issued by the Missouri Department of Revenue Division of
Motor Vehicle and Drivers Licensing] back to top
What legal duties are imposed upon a lienholder following satisfaction
of the lien?
Pursuant to Missouri Statutes, TITLE XIX, Chapter 301, § 301.640:
Upon the satisfaction of any lien or encumbrance of a motor vehicle or
trailer, the lienholder shall, within ten business days release the lien or
encumbrance on the certificate or a separate document, and mail or deliver
the certificate or a separate document to the owner or any person who
delivers to the lienholder an authorization from the owner to receive the
certificate or such documentation. The release on the certificate or separate
document shall be notarized. Each perfected subordinate lienholder if any,
shall release such lien or encumbrance as provided in this section for the
first lienholder. The owner may cause the certificate to be mailed or
delivered to the director of revenue, who shall issue a new certificate of
ownership upon application and payment of the required fee. A lien or
encumbrance shall be satisfied for the purposes of this section when a
lienholder receives payment in full in the form of certified funds, as defined
in section 381.410, RSMo.
If the electronic certificate of ownership is in the possession of the
director of revenue, the lienholder shall notify the director within ten
business days of any release of a lien and provide the director with the most
current address of the owner. The director shall note such release on the
electronic certificate and if no other lien exists the director shall mail or
deliver the certificate free of any lien to the owner.
If the purchase price of a motor vehicle or trailer did not exceed six
thousand dollars at the time of purchase, a lien or encumbrance which was
not perfected by a motor vehicle financing corporation whose net worth
exceeds one hundred million dollars, or a depository institution, shall be
considered satisfied within six years from the date the lien or encumbrance
was originally perfected unless a new lien or encumbrance has been
perfected as provided in section 301.600. This subsection does not apply to
motor vehicles or trailers for which the certificate of ownership has
recorded in the second lienholder portion the words "subject to future
advances".
Any lienholder who fails to comply with subsection 1 or 2 of this section
shall pay to the person or persons satisfying the lien or encumbrance
twenty- five dollars for the first ten business days after expiration of the
time period prescribed in subsection 1 or 2 of this section, and such
payment shall double for each ten days thereafter in which there is
continued noncompliance, up to a maximum of five hundred dollars for
each lien. If delivery of the certificate or other lien release is made by mail,
the delivery date is the date of the postmark for purposes of this subsection.
Any person who knowingly and intentionally sends in a separate
document releasing a lien of another without authority to do so shall be
guilty of a class C felony. back to top
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