Glossary

Salvage

What remains of damaged property after a loss, and the insurer's option to take it or deduct its leftover value once the claim is paid.

Also called: salvage value, salvage rights

Salvage is the damaged property left after a loss and whatever value it still has. The term is most familiar from auto claims, but it applies to homes too: a water-stained piano, a hail-dented grill, a smoke-damaged sofa, an appliance that still works but looks ruined. Many policies give the insurer the option to take the damaged item once it has paid for it. The alternative is for you to keep it, with the salvage value subtracted from the payment.

Say a couch set valued at $3,000 is ruined by smoke, and a salvage buyer would pay $200 for it (hypothetical). The insurer either collects the furniture and pays the full amount, or you keep it and receive $2,800. What matters is that you do not keep the item and also collect the full price for it.

Do not throw away damaged belongings before the adjuster has seen them. The standard policy conditions require you to show the damaged property, so photograph it, keep it where it is safe to do so, and ask before disposing of anything, getting permission in writing for health hazards such as mold or sewage-soaked items. The guides on filing a personal property claim and documenting damage explain what to keep and record.

Last reviewed October 10, 2026

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Related terms

Subrogation The insurer's right, after paying your claim, to step into your place and recover that money from whoever caused the loss. Total loss A loss in which the home is destroyed or too damaged to repair, so the insurer pays toward rebuilding up to the dwelling limit rather than for repairs. Actual cash value What an insurer pays for damaged property: the cost to repair or replace it today, minus a deduction for age and wear, so less than a new-for-old payment. Contents inventory An itemized list of belongings that were damaged, destroyed or stolen, with quantity, description, age and cost, used to support a personal property claim. Personal property (Coverage C) Coverage for the movable things you own, such as furniture, clothing, electronics and tools, whether they are at home or elsewhere in the world.