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Blog category: Driving

Buyer Beware: Protect Yourself from Flood-Damaged Cars

5 min read

The first part of 2024 brought rain to California — lots of rain. Storm systems were so powerful that most Golden State residents are now familiar with the term “atmospheric river.” The empty reservoirs and drought-parched land desperately needed rain, but the record levels of precipitation triggered disaster declarations in parts of southern California. Residents in many counties were faced with extensive flooding, mudslides, and massive infrastructure damage.

Submerged Vehicles

Another less obvious casualty of the recent storms across the state: thousands of water-damaged vehicles. Most of us are familiar with images of semi-submerged trucks and cars floating in sludgy rivers of flood water. But unless one of the sinking vehicles belongs to us, or someone we know, how often do we consider what happens to the unfortunate cars afterward?

We may assume (or hope) that badly damaged water-logged cars are hauled away for scrap — and most are — but some will reappear in private sales and at dealerships around the country.

Growing Problem

Water-damaged cars saturating the market (pardon the pun) have become a bigger issue in recent years. The global shortage of new cars, stemming from supply chain disruptions and manufacturing challenges has resulted in an unprecedented surge in the demand for used cars. With fewer new models rolling off assembly lines, car buyers have been forced to turn to the pre-owned market.

This demand has led to stiff competition for desirable used cars — and has also made it easier for corrupt sellers to pass off water-logged cars to unsuspecting buyers.

Take Your Time

If you’re in the market for a new (to you) car and you take nothing else from this article, seriously consider this piece of advice: don’t be in a rush to buy. Take your time to thoroughly check out any car you’re looking at. Some flood-damaged vehicles can look perfectly fine on the outside while hiding a swampy mess within.

After a flood or hurricane, it’s common for dishonest dealers to clean up water-logged cars and ship them out of state for sale. It pays to perform due diligence and look (very) closely for tell-tale signs.

How to Spot a Flood-Damaged Car

  • Take the sniff test. One of the easiest ways to spot a flood-damaged car is to open the door and breathe in. If you’re hit with a musty odor, that’s a strong indication of water damage. Likewise, if you smell strong cleaning products, there’s a good chance someone is trying to cover up something bad.
  • Have a good look. Do you see mud or sand under the seats? Is the carpet loose, stained, or mismatched? Do the doors show signs of rust? These clues can tell the story of a recently submerged car.
  • Check the electrical systems. Defective lights, wipers, turn signals, or sluggish power windows are a huge red flag, as are distorted speakers.
  • Ask a professional. A mechanic will be able to alert you to signs of rust or corrosion and if the mechanical and electrical systems have been affected by water.
  • Do your research. Go to for free information about a vehicle’s title, most recent odometer reading, and condition. For a fee, you can get other reports that detail accident and repair history.
  • Check for damage. If the car in question was insured when it was damaged, The National Insurance Crime Bureau’s (NCIB) free database will show if it was flood-damaged, stolen but not recovered, or otherwise declared as salvaged.
  • Exercise caution. If a seller is offering you a great price on a newer model car (five years or under) especially if it sports new carpets or upholstery, be very skeptical.
  • Ask for a warranty. A reputable dealer should have no problem selling you a warranty. This way, you’ll have recourse if anything goes wrong.
  • Report fraud. Contact the NICB if you suspect a dealer is knowingly selling a storm-damaged or salvaged vehicle as a used car in good condition.

California Lemon Laws

In California, robust lemon laws safeguard consumers who unknowingly purchase storm-damaged cars from shady sellers. Under the state's lemon laws, if you later discover the vehicle has major defects directly resulting from water exposure, you’re entitled to pursue a lemon law claim against the seller. This legal protection allows buyers to ask for a refund, a replacement, or compensation. Of course, this assumes that you can locate the seller after you’ve paid for the car.

Federal Laws

The Federal Trade Commission (FTC) requires dealers who sell more than five cars a year to post a Buyers Guide in every vehicle for sale.

The guide must note:

  • If the car’s being offered “as is.”
  • If it comes with a used-car warranty.
  • The percentage of repair costs covered under the warranty.
  • The major defects that can happen to used cars.

Selling a Flood-Damaged Vehicle

If you’re on the other end of a soggy scenario and trying to offload your unfortunate wheels, know that it is possible. Your car may be attractive to someone who wants to restore it or use the parts, but there are some important considerations to keep in mind. The following pointers should help keep your conscience clear — and keep you on the right side of the law.

  • Be transparent. Honesty is the best policy in this situation. Disclose the water damage history upfront and let potential buyers know about the vehicle’s flood salvage title. This way you avoid any awkward conversations down the road or worse — legal issues.
  • Be realistic. No matter what you paid for the car or its pre-flood value, chances are you’re not going to get a super high price for it. Many buyers will be wary due to the possibility of long-term issues. Even if the engine seems salvageable, other parts may not be.
  • Be aware of the law. Legally, sellers must inform buyers about water and any other damage. Misrepresenting a vehicle’s condition is considered fraud.

Pro-tip: Some insurance companies allow you to buy back your car at its salvage value — but only to use for parts. If you choose to rebuild a storm-damaged vehicle, you’ll need to get a rebuilt title indicating extensive prior damage.

It can be tempting to jump on a deal when the competition’s fierce and you’re being offered a pre-owned car at a decent price. The ride in question may check all the boxes as far as looks, price, and mileage, but don’t skip the investigative process. Take your time to go down the list above. That way you’ll avoid ending up with a water-logged lemon.

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The above content is for informational purposes only and is not a direct representation of coverages offered by Wawanesa or its policies. The information does not refer to any specific contract of insurance and does not modify any definitions, provisions, exclusions or limitations expressly stated in any contracts of insurance. All references within the above content are illustrative and may not apply to your situation. The terms and conditions of the actual insurance policy or policies involved in a claim are determinative as to whether an accident or other loss is covered. To understand the coverage under your current policy, please log into the account management platform to review your policy or contact an agent directly.

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