When a car is salvaged (i.e., declared a total loss), that means that the insurance company has taken possession of the vehicle, offering the insured the market value of the car for their loss (where market value is the value of the car in its salvaged state). The car that was worth $X on their books is now $Y in cash, and $Y is usually significantly less than $X, because salvaged cars are usually worth way less than a normal used car (though sometimes the car is worth more as spare parts, for uncommon vehicles or for models no longer in production).