When the insured's car was totaled in a recent accident, what is the term for the action of the insurer selling off the wrecked car to recover some of the loss it paid to the insured?

The correct term for the action of the insurer selling off the wrecked car to recover some of the loss it paid to the insured is salvage. In the context of insurance, salvage refers to the process by which an insurer takes possession of the damaged property—such as a totaled car—after they have compensated the insured for their loss. The insurer then sells the wrecked vehicle, often to a junkyard or recycling operation, to recoup some of the financial losses associated with the claim payment.

This practice is financially beneficial for insurers, as it helps mitigate the costs of claims they pay out. By recovering some value from the damaged property, insurers can maintain lower premiums for all policyholders. Other terms, like subrogation, refer to the insurer's right to pursue a third party responsible for the loss after compensating the insured, while depreciation pertains to the decrease in the value of an asset over time. Resale would imply a normal sale of an item still in a usable condition, which would not apply in the context of a totaled vehicle.