What is salvage and what happens to it?

[Sushma Baviskar]

Salvage refers to discarded parts that are damaged beyond repair and, therefore, need to be replaced. If these parts have no economic value (broken glass, torn plastic, rubber) they are thrown away. However, parts like doors, panels, petrol tanks, front forks etc., do have a residual commercial value or scrap value. At the time of payment of the claim amount, the salvage value will be reduced from any loss settlement, if the insured retains the damaged property. 

[Israr Choudhry]

What happens if we don't take custody of the scrap? do we get the entire claim amount?

[Arti · Accepted solution]

Dear Sir , 

In case of claims the partly damaged goods or the wreck of a car or any machinery or any other property settled on Total Loss Basis is known as “Salvage”. After settling the claim for the full amount the salvage becomes the property of insurance company.