| (a) Determination of condition of vehicle.
(1) Salvage motor vehicle. When a vehicle is damaged,
the actual cash value of the motor vehicle immediately before the
damage and the cost of repairs shall be used to determine whether
the damage is sufficient to classify the motor vehicle as a salvage
motor vehicle.
(2) Non-repairable motor vehicle. When a vehicle is
damaged, the actual cash value of the motor vehicle immediately before
the damage and the cost of repairs, or alternate method commonly used
by the insurance industry, shall be used to determine whether the
damage is sufficient to classify the motor vehicle as a non-repairable
motor vehicle.
(3) The actual cash value of the motor vehicle is the
market value of a motor vehicle as determined:
(A) from publications commonly used by the automotive
and insurance industries to establish the values of motor vehicles;
or
(B) if the entity determining the value is an insurance
company, by any other procedure recognized by the insurance industry,
including market surveys, that is applied in a uniform manner.
(4) The cost of repairs, including parts and labor,
shall be determined by:
(A) using a manual of repair costs or other instrument
that is generally recognized and used in the motor vehicle industry
to determine those costs; or
(B) an estimate of the actual cost of the repair parts
and the estimated labor costs computed by using hourly rate and time
allocations that are reasonable and commonly assessed in the repair
industry in the community in which the repairs are performed.
(5) The cost of repairs does not include:
(A) the cost of:
(i) repairs related to gradual damage to a motor vehicle;
(ii) repairs related to hail damage; or
(iii) materials and labor for repainting or when the
damage is solely to the exterior paint of the motor vehicle; or
(B) sales tax on the total cost of repairs.
(b) Who must apply.
(1) An insurance company licensed to do business in
this state that acquires ownership or possession of a non-repairable
or salvage motor vehicle that is covered by a certificate of title
issued by this state or a manufacturer's certificate of origin shall
obtain a non-repairable or salvage vehicle title, as provided by §217.84
of this title (relating to Application for Non-repairable or Salvage
Vehicle Title), before selling or otherwise transferring the non-repairable
or salvage motor vehicle, except as provided by subsection (c) of
this section.
(2) A salvage vehicle dealer shall obtain a Non-repairable
or Salvage Vehicle Title, or comparable out-of-state ownership document,
before selling or otherwise transferring the motor vehicle, except
as provided by §217.88(b) of this title (relating to Sale, Transfer,
or Release of Ownership of a Non-repairable or Salvage Motor Vehicle).
(3) A person, other than an insurance company or salvage
vehicle dealer, who acquires ownership of a non-repairable or salvage
motor vehicle that has not been issued a non-repairable vehicle title,
a salvage vehicle title, or a comparable out-of-state ownership document,
shall obtain a non-repairable or salvage vehicle title, as provided
by §217.84, before selling or otherwise transferring the motor
vehicle, unless the motor vehicle will be dismantled, scrapped, or
destroyed.
(c) Owner retained vehicles.
(1) An owner may retain a vehicle only as provided
by this subsection and if the vehicle was titled in Texas before it
became a salvage or non-repairable vehicle.
(2) When an insurance company pays a claim on a non-repairable
or salvage motor vehicle and does not acquire ownership of the motor
vehicle, the company shall submit to the department before the 31st
day after the date of the payment of the claim, on a form prescribed
by the department, a report stating that:
(A) the insurance company has paid a claim on the non-repairable
or salvage motor vehicle; and
(B) the insurance company has not acquired ownership
of the non-repairable or salvage motor vehicle.
(3) Upon receipt of the report described in paragraph
(2) of this subsection, the department will place an appropriate notation
on the motor vehicle record to prevent registration and transfer of
ownership prior to the issuance of a salvage or non-repairable vehicle
title.
(4) The owner who retained the non-repairable or salvage
motor vehicle to which this subsection applies shall obtain a non-repairable
or salvage vehicle title, as provided by §217.84, before selling
or otherwise transferring the non-repairable or salvage motor vehicle.
(5) Until a non-repairable or salvage vehicle title,
or a comparable out-of-state ownership document, has been issued for
an owner-retained non-repairable or salvage vehicle, the owner of
the motor vehicle may not sell or otherwise transfer ownership of
the vehicle.
(6) The owner of an owner retained non-repairable or
salvage motor vehicle may not operate or permit operation of the motor
vehicle on a public highway, until the motor vehicle is rebuilt, titled
as a rebuilt salvage motor vehicle or rebuilt non-repairable motor
vehicle, if applicable, and is registered in accordance with Subchapter
B of this chapter.
(d) Self-insured vehicles. The owner of a non-repairable
or salvage motor vehicle that is self-insured and that has been removed
from normal operation by the owner shall apply to the department for
a non-repairable or salvage vehicle title, as provided by §217.84,
before the 31st day after the damage occurred, and before selling
or otherwise transferring ownership of the non-repairable or salvage
motor vehicle.
(e) Casual sales. A salvage vehicle dealer, salvage
pool operator, or insurance company that acquires a non-repairable
or salvage motor vehicle shall apply to the department for a non-repairable
or salvage vehicle title, in accordance with §217.84, prior to
offering the motor vehicle for sale in a casual sale.
(f) Export-only vehicles. A salvage vehicle dealer,
including a salvage pool operator acting as agent for an insurance
company, or governmental entity that acquires a non-repairable or
salvage motor vehicle and offers it for sale to a non-United States
resident shall apply to the department for a non-repairable or salvage
vehicle title, as provided by §217.84, before selling or otherwise
transferring the non-repairable or salvage motor vehicle and before
delivery of the non-repairable or salvage motor vehicle to the buyer.
A salvage vehicle dealer or governmental entity shall maintain records
of all export-only non-repairable or salvage motor vehicle sales as
provided by §217.88(g).
(g) Voluntary application. A person who owns or acquires
a motor vehicle that is not a non-repairable or salvage motor vehicle
may voluntarily, and on proper application, as provided by §217.84,
apply for a non-repairable or salvage vehicle title.
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