Phone: 630-495-2282 Fax: 630-495-2260 Map/Directions

Total-loss bills stuck in the mud on Capitol Hill

November 17, 2010

Identical bills addressing total-loss disclosure have been inactive since they were introduced in the House and Senate in February. The bills, Senate Bill 545 and House Resolution 1029, call for the VINs of wrecked, flooded or stolen vehicles to be made publicly available before the cars are resold.


Dealers are encouraged to contact their congressmen and Senators to urge them to reject the insurance industry alternative and to cosponsor the total loss disclosure legislation. That will ensure used-car buyers have the information they need to make educated decisions about the safety and fair market value of used vehicles. 

Sen. Trent Lott (R-Miss.), the second ranking Senate Republican, introduced S. 545. But only two other senators have joined as cosponsors: Sens. John Ensign (R-Nev.) and Ted Stevens (R-Alaska). Rep. Cliff Stearns (R-Fla.) introduced H.R. 1029. The bill has added 25 cosponsors, none from Illinois. Similar legislation was considered last year by Congress, but they expired with the end of the 109th Congress last December.


Many totaled vehicles and flood-damaged Katrina cars are making it back onto the roadways when unscrupulous rebuilders buy an insurance-totaled vehicle at a salvage auction, refurbish it, and then attempt to resell it without disclosing the vehicle’s significant damage history.  In many cases, a vehicle with a salvage title can be easily "cleaned" or "washed" in a state with weak title disclosure rules. 

David Regan, the NADA’s vice president of legislative affairs, testified in April before the Senate Commerce Committee about S. 545. "The total-loss history of a vehicle," Regan said, "is the most important piece of information that consumers can use to make an educated assessment as to the safety and fair market value of a used car With total-loss data, used car buyers—consumers and dealers—can avoid unknowingly purchasing a rebuilt wreck."


Regan said the problem exists because of confusing, incomplete and contradictory state titling systems and the fact that it is in the insurance companies’ financial interest to underreport total-loss declarations.  But DMVs and title history services may never get information about vehicles totaled by insurance companies, since not all total-loss vehicles are retitled to reflect the severity of the damage.  

In his remarks to the Senate committee, Regan said the Lott legislation is necessary for the following reasons:


The public needs access to more complete total-loss information. Insurance companies should provide VIN-based disclosure for all totaled vehicles as well as the reason for the total loss (flood, collision, stolen, etc.), the date, the odometer reading, and whether or not the airbag deployed.  S. 545 would push this information into the public domain through vehicle history providers such as Experian’s AutoCheck and Carfax. 

The public needs more timely total-loss information. The ability of consumers to access VIN-based vehicle data on a timely basis before a vehicle is resold is an essential part of this solution.  S. 545 would require the insurance companies to disclose the VIN of a total loss vehicle at the time of payout thereby immediately creating an electronic record that would warn the public about the history of these severely damaged vehicles.


The public needs total-loss data available in a searchable format to help assist used car buyers prior to purchasing a vehicle. The insurance companies are the first to be informed that a vehicle has been totaled, and they already track these cars in their own databases. The insurance companies should share this total-loss information with the public.   

"Insurance companies can and should do more to combat title fraud by disclosing the history of these substantially damaged vehicles and keep dangerous rebuilt wrecks off the road," Regan said. 


For more information and resources on total-loss vehicle data disclosure and flood-damaged vehicles, see