DMV briefed Senate Transportation on salvage and bonded vehicle titles

Deputy Commissioner Matt Russo told the Senate Transportation committee that a salvage title is issued when an insurer deems a vehicle a total loss, commonly when damage reaches roughly 75 percent of the vehicle’s value. "A salvage title is issued when a vehicle is considered a total loss, usually 75% of the vehicle loss, for an insurance company," Russo said. He added that salvage brands are typically placed on titles issued to insurance companies and "the salvage brand that's put on that title stays on there for the life of the title."

Russo described the rebuild pathway: if the vehicle is rebuilt and passes inspection at a certified inspection station, the title will retain the salvage brand and additionally receive a rebuilt brand so future buyers see the vehicle’s history. He said the DMV’s rebuild process includes certified inspections and documentation required before registering a rebuilt vehicle.

On disclosure, Russo said titles and vehicle-history reports will show brands and that dealers and sellers are required by law to disclose salvage history. He acknowledged enforcement and penalty authority rests with the DMV but said he did not have immediate penalty tallies and offered to provide numbers to the committee.

Russo also explained bonded titles, which are used when the most recently issued title cannot be produced. "We require that you hand over the most recently issued title for the vehicle when you register it in your name," he said, adding that if applicants cannot obtain that title they may secure a surety bond as protection against later claims. The DMV requires a bond sized at 1.5 times the vehicle value; Russo said the premium a consumer pays depends on the surety provider and market conditions.

Committee members raised practical concerns. One member described a constituent who abandoned pursuit of ownership after weeks of trying to trace prior title holders; another noted that for a low-priced car the cost of obtaining a bonded title can be disproportionately high. Russo agreed and emphasized the requirement to make exhaustive efforts to obtain the prior title before using the bond alternative.

Russo encouraged consumers to consult vehicle-history resources. He said Vermont reports titles to the National Motor Vehicle Title Information System (NMVTIS) and that the DMV’s website lists approved third-party providers; some commercial services such as CARFAX provide paid reports showing title brands and claim history. "Our website has a list of all approved providers," Russo said.

The committee did not take formal action on title-related statutory changes during the session; members asked the DMV to provide additional enforcement/penalty data for future consideration.