Bill
HB 2671
Requires salvage certificate when insurer pays total-loss; sets 5-day/$1,000 storage cap and 20-day title delivery, with special rules for older vehicles and theft claims.
Status (key dates)
- Introduced: February 6, 2025 (House, Rep. David Friess; cosponsored by Rep. Camille Y. Lilly)
- Passed both chambers: early May 2025 (transmitted to Governor 2025-05-06)
- Vetoed by Governor: 2025-05-12
- Note: House Floor Amendment No. 1 (filed 2025-04-08) made substantive changes to insurer possession/disposal language and added limits on storage charges.
Purpose / intent
- To clarify and modify when a salvage certificate must be obtained under the Illinois Vehicle Code after an insurance company pays a total-loss claim, and to allocate responsibility for possession/disposal, title delivery, and related costs for total-loss vehicles.
Key provisions (as amended by House Amendment No. 1)
- Salvage certificate required when an insurer pays damages on a total-loss claim. Upon payment the insurer is deemed owner of the vehicle and the vehicle is salvage, with the following exceptions:
- Vehicles with only hail damage that do not affect operational safety, and
- Vehicles 9 model years of age or older, which the registered owner may retain by agreement with the insurer.
- For vehicles 9 model years old or older: if the registered owner does not agree to retain the vehicle, the insurer must arrange for disposal of the vehicle (amendment replaced an earlier draft that required the insurer to take physical possession).
- Storage charges for a vehicle declared a total loss are limited to 5 days from the date of declaration, and in no event may storage charges exceed $1,000.
- Title and salvage application deadlines: the insurer must promptly (within 20 days) deliver or mail the certificate of title with the proper application and fee to the Secretary of State so a salvage certificate may be issued in the name of the insurer.
- Theft claims: an insurer that pays a total-loss claim for a stolen vehicle is not required to apply for a salvage certificate unless the vehicle is recovered and has damage that would have produced a total-loss determination.
- Self-insured entities: similar rules apply; a vehicle is considered salvage if repair costs (including labor) exceed 70% of the vehicle’s fair market value, and the self-insured must apply for a salvage certificate.
- Purchasers at auctions or certain public sales: persons acquiring a vehicle at auction (or through other enumerated dispositions) must submit required documents and apply for a salvage or junking certificate within 20 days; salvage/junk certificates issued under this Section are freed of preexisting liens.
Who is affected
- Vehicle owners: especially owners of older vehicles (9+ model years) who may choose to retain a totaled vehicle — or, if they decline, will have the insurer arrange disposal; exposure to capped storage charges.
- Insurance companies and self-insured entities: administrative responsibilities (title transfer/application within 20 days), possible disposal costs, compliance with storage charge limits, and determinations about total-loss thresholds.
- Secretary of State: processing salvage and junking certificate applications and enforcing time frames and documentation rules.
- Salvage yards/auction purchasers: timing and lien-free salvage/junk certificate rules affect acquisition and resale.
Practical effects and issues
- Shorter timelines and explicit limits on insurer responsibilities aim to reduce owner storage cost exposure and clarify title-transfer obligations following total-loss payments.
- The 9-year threshold creates a special rule for older vehicles; operational and administrative impacts may fall disproportionately on small insurers, salvage processors, and owners of older cars.
- The 70% repair-cost threshold codifies a numerical test for self-insured entities to deem a vehicle salvage.
For further reference
- Amends Section 3-117.1 of the Illinois Vehicle Code (Certificate of Title Article).
- House Amendment No. 1 (Apr 8, 2025) changed insurer possession language and added the 5-day/$1,000 storage cap; the bill ultimately passed the legislature but was vetoed by the Governor on 2025-05-12.
Compiled from official sources — confirm details with the bill’s official record.
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