Flood waters are still receding in the aftermath of Hurricane Harvey in southeastern Texas, but it’s apparently never too early for fraud. With hundreds of thousands of abandoned vehicles left in the flooded streets of Houston and beyond, unscrupulous wreckers have already “kidnapped” some vehicles, according to Insurance Council of Texas spokesman Mark Hanna. According to him, some wreckers, whom he characterizes as “a small number of characters here,” have been pulling vehicles from the waters and then charging vehicle owners as much as $4000 to $5000 to get their cars and trucks back, adding on administrative and handling fees to jack up the price. “We’re telling people, if they do use a wrecker service, use caution whenever they’re asked to sign anything,” Hanna said.
Yet a vast number of vehicles are currently in need of towing services in the 125 Texas counties affected by the storm. Hanna’s office said Thursday that about 100,000 car and truck owners have already submitted insurance claims for flood-damaged vehicles. About 75 percent of those vehicles will likely be totaled. Multiple reports put the estimated number of cars damaged in the widespread flooding at 500,000 or more. Solera, a Texas-based technology company specializing in auto claims, estimates that 500,000 to 600,000 vehicles will be considered ruined.
Once the cars and trucks are dried out, another grift begins: the sale of flood-damaged cars to unwitting consumers in other parts of the country. There were 271,404 flooded cars back in use nationwide last year, according to Carfax. The National Insurance Crime Bureau (NICB) is warning consumers that uninsured vehicles could be put up for sale with no disclosure of the vehicle’s having been damaged. ICT spokesman Hanna said about 15 percent of Texans generally drive without insurance. Of the Texan motorists that are insured, about 75 percent have comprehensive coverage, which would cover flood damage.
Insured vehicles deemed total losses will be retitled with the Department of Motor Vehicles. Their new titles will declare that the cars and trucks have been flood damaged, and that information will be stated in vehicle history reports. Most of the flooded vehicles will likely be parted out, with their undamaged components finding new life elsewhere, according to the NICB. “Unfortunately, some of the flooded vehicles may be purchased at bargain prices, cleaned up, and then taken out of state, where the VIN is switched and the car is retitled with no indication it has been damaged,” the bureau noted.
To avoid buying such a car or truck, the vehicle’s history report is a great place to do a bit of due diligence, after checking first for a salvage title. You can also run a prospective purchase’s Vehicle Identification Number (VIN) on the NICB’s VINCheck, which covers salvage records for its member insurance companies. The system represents about 88 percent of the auto insurance market, the NICB said.
If the vehicle’s history seems cloudy—which is a red flag in and of itself—but still seems to be an intriguing purchase opportunity, the NICB recommends that potential buyers check for water stains, mildew, and/or silt under the floor mats, beneath the headliner, and behind the dashboard. Check for fading of the interior or door panels as well, the bureau says, and also look for rusted screws in the console or other areas where water would not normally accumulate, and see if there is mildew or grime in the seatbelt retractors. Door-mounted speakers are also likely to have been damaged during a flood. Carfax suggests that other signs of flood damage might be brittle wires under the dashboard; fogged lights inside, outside, or in the instrument panel; or new upholstery or carpeting that doesn’t seem to match the vehicle.