Every year, thousands of flood-damaged cars are put on the market after natural disaster events like hurricanes, tornadoes, and other storms. Vehicles that have been subject to periods of time sitting in floodwaters are considered flooded vehicles. Flooded cars can put both drivers and passengers at risk due to their potentially unreliable and unsafe nature.
According to the Insurance Information Institute (iii), any vehicle that has been submerged to its floor or higher is considered a totaled vehicle for insurance purposes. Being submerged or partially submerged damages a range of vehicle systems, including the engine, transmission, and crucial electronic components.
These totaled vehicles often go through chop shops to make them appear to be in normal working condition and from there they can end up in auctions and on used car lots, hundreds of miles from where they were originally damaged and or declared totaled. The National Insurance Crime Bureau (NICB) is a non-profit organization that tracks these illegal actions and insurance claim fraud.
As a car buyer, here are some tips you can use to protect yourself from purchasing a flood-damaged car.
Tip 1: Check the VIN
When looking to purchase a used car, you should always check the vehicle identification number (VIN) and make sure that it matches in every area the VIN is recorded on the car and its paperwork. VIN-checking services such as CarFax are a great way to alert you to vehicles with flood titles or salvage titles.
The two most common places to find the VIN are on the dashboard on the driver's side in the corner where the dashboard meets the windshield, and also on the driver's side doorjamb (look for a 17-character string of numbers and letters). It might also be on the engine and under the hood. Any sign of VIN tampering should be looked at with suspicion.
Sometimes vehicles are reconditioned and then pass inspection in another state. When this occurs, the vehicle might be retitled, and the new VIN will not match instances of the VIN located around the vehicle. Utilizing online resources such as CarFax can assist in the tracking of reconditioned vehicles through their VIN number, but online VIN tracking can only do so much against insurance crimes.
Tip 2: Inspect the Interior
One of the most obvious signs of a vehicle that has been submerged in water is a musty odor, water stains on the upholstery, or signs of mildew on the interior. Investigate the interior thoroughly of any used vehicle that you plan to purchase. Pull up floor mats and inspect the flooring for signs of mold, mildew, or staining. Open the glove compartment and look for traces of mud or silt. Often you can find dirt buildup in odd places on flood-damaged cars. You might find it under the dashboard, in the seat tracks, or beneath the door liner.
Other places to look include the trunk and spare tire (if there is one). A good rule of thumb is to inspect places that are hard to get to and hard to clean. Sometimes you might encounter suspicious signs of hidden damage, such as new fabric, excessive air fresheners, and recently shampooed carpeting (though that last one could also be a sign of the seller simply cleaning the vehicle).
If the exterior of the vehicle is a little rough, but the inside seems a little too polished, it might be a sign that water damage is being hidden. Brand new carpeting and mats in an older vehicle can be a red flag.
Tip 3: Look at the Lights
It is fairly difficult to get rid of a key sign of water damage: the effect water has on the lights. On flood-damaged cars, you might see beads of moisture and fog behind the protective headlight lenses. There might even be a visible waterline stained on the cover. Be sure to inspect all of the lights on the vehicle closely.
Tip 4: Check the Wiring
Check any items that have electrical components such as radios, interior lighting, dashboard lights, blinkers, warning lights, power windows, power locks, power lift gates, and anything else you see that is operated with an electrical system. If any of these are not working properly, investigate the wiring by looking for rusted parts, water residue, or any unusual corrosion. You can also test the electronics of the vehicle to make sure that there are not any odd shorts or things that inexplicably do not work.
Tip 5: Look for Rust
Rust and corrosion are not normal in newer vehicles, or in vehicles from warm climates that do not receive snow. Get underneath the vehicle and check areas around the fuel tank, brake lines, and shock towers. Check the wheel wells, in between the bumper corners, the body, and the roof rails. Inside, you can check for signs of rust beneath the seats, under the dashboard and instrument panel, and other areas that would not normally be exposed to water. Look at exposed screws and other unpainted metal. Bare metal will almost always show light surface rust in flood-damaged cars.
Tip 6: Have a Trusted Mechanic Inspect the Vehicle
While it is true that you could check for many of these issues yourself, a trusted mechanic can do an even better job of looking for problems. Any dealership or seller with nothing to hide will not object to a mechanic inspection. Mechanics can inspect areas that only certified professionals would really know about.
Mechanics can inspect the engine compartment for signs of hydro lock, the fuel system for any water presence, and all other major mechanical systems that the vehicle uses to function. The small price you pay for a professional inspection could save you from spending thousands on a dressed-up junkyard-level car.
Are You Selling a Vehicle in a Flood Zone?
If you are selling your vehicle and you live in a flood zone, be prepared for questions about the vehicle's condition and be prepared to offer a full vehicle history. You can build trust with a potential buyer by having your vehicle inspected by a mechanic and issued a clean bill of health prior to the sale.
National Motor Vehicle Title Information System
Another useful tool for those shopping for used cars is the National Motor Vehicle Title Information System (NMVTIS), a database aimed at combatting title washing. Title washing is when a totaled or stolen car is retitled in another state that has differing laws or regulations about title reporting.
Another source of concern is when a car owner does not have comprehensive coverage insurance and the vehicle gets damaged by flooding which voids the insurance policy. When a repair bill does not exceed the amount to be considered salvaged and the owner does not carry comprehensive insurance, the owner is then liable for all charges, and the damage is not reported. This means that a salvaged title might not be issued. Only a few states have flood titles, which is when all flood damage history must be recorded.
When an insurance company declares a damaged vehicle a total loss, a salvage title is issued. The title is marked or branded either with a word, letter, or number code. Reselling these cars is usually legal as long as the damage is completely disclosed. Salvage title vehicles can not be registered again until the required repairs are made and the vehicle is inspected by official parties.
The title is then declared as rebuilt and can be registered for resale or use. Be suspicious of any vehicles being sold without a title and try to avoid these at all costs.