A vehicle deemed a total loss ("totaled") by an insurance company results in the issuance of a salvage title for the vehicle. It becomes a "salvage vehicle" and CANNOT be driven on the highways or have a valid license plate. It can be sold ("AS IS") to an automobile rebuilder to be used either for parts or to be restored ("rebuilt"). If restored, it must be inspected and ultimately a "rebuilt title" will be issued for the vehicle. A rebuilt vehicle with a rebuilt title CAN be driven on the highways.
If a salvage vehicle is retained by the owner, the owner must:
- obtain a rebuilder's license so that he/she can legally restore the vehicle;
- restore/rebuild the salvage vehicle "to the condition that existed before" the damage that totaled it; and
- have it inspected by the Department of Revenue Automobile Inspection Section to make sure that the salvage vehicle is completely restored and that it contains no stolen parts. Under Alabama law, only an Alabama licensed rebuilder may apply for an inspection of a rebuilt vehicle. Additionally, the vehicle must be restored in Alabama and not in another state.
To apply for a rebuilder's license, contact the Alabama Department of Revenue License Tax Section, P.O. Box 327550, Montgomery, AL 36132-7550 - Telephone: (334) 353-7827. A license application with instructions can be obtained which explains the licensing requirements and fees. Among other things, state law requires that a $10,000 surety bond be posted to become licensed as a rebuilder. Also, a rebuilder must have proof of garage liability insurance coverage to obtain a rebuilder license.
Once the owner meets the rebuilder's license requirements, the following documents must be included with an application for a salvage vehicle inspection:
- INV 26-15 Form (Application for Inspection of a Salvage Vehicle)
- INV 31-1 Form (Remittance Advice).
- The original salvage title properly assigned to the owner (Licensed Rebuilder)
- Parts Bills-Of-Sale:
- Notarized bills of sale of all major component parts (listing the manufacturer's vehicle identification number of the vehicle from which the parts were removed).
- Bills of sale of all minor component parts (notarization shall not be required). If a minor component part contains or should contain the manufacturer's vehicle identification number, notarization is required.
- Copy of Rebuilder's License
- $90.00 Fee, payable by certified funds (Application fee of $75.00 plus title fee of $15.00)
The above listed documentation should be mailed to: Department of Revenue Automobile Inspection Unit, P.O. Box 327641, Montgomery, Alabama 36132-7641 - Telephone (334) 242-3012.
Upon satisfactory completion of the inspection, a "rebuilt" identification plate will be permanently affixed to the vehicle and a "rebuilt title" will be issued. Until then, the salvage vehicle cannot be used on the highways, except for repairs/restoration or to take it for the inspection.