Scout InsurTech Interview with Salvato

Salvato is the smarter auction for insurance vehicles, accelerating total loss claims from assignment to auction and delivering better outcomes for insurers. Chris Luiz sat down with Co-Founder and CEO, Peter Jebson, to learn how Salvato is impacting the industry.

Who are your clients?

Salvato serves auto insurance companies, including carriers, MGAs and TPAs. We are proud to have launched this spring with multiple insurers on the Salvato TLX platform.

What does your product do?

Salvato TLX accelerates the total loss experience for insurers from assignment to auction. By leveraging modern processes and integrations, Salvato delivers:

• better claims experience: lien and title in days (not weeks) with no physical paperwork required

• faster cycle time: two plus weeks cut from every total loss claim

• higher net salvage return: $300 plus increase per total loss vehicle

  
  

Salvato has modernized every step of the total loss experience for insurers, particularly the lien release and title transfer, which have historically driven the long cycle time on these claims. On vehicles with a lien, we secure letters-of-guarantee in an average of 2-3 business days through our exclusive partnership with LossExpress. And on title transfer, our involvement in the National Digital Titling Clearinghouse allows us to complete the transfer in less than one business day without any physical paperwork or wet-ink signatures required.

This ability to go “fast” on total loss claims allows us to reduce costs on our side and put those cost savings back in the hands of sellers and buyers where they belong. 

How much capital have you raised?

We founded the company with the belief that all sides of this market deserved a better solution, and we spent over a year building the platform before we signed our first insurance customers. Last fall we secured the backing of institutional investors like Walkabout Ventures and Banter Capital, which allowed us to grow to a team of 10 people now working to modernize this aspect of the claims process and deliver better results for insurers.

Was the company born from within or outside the industry?

Our leadership team is entirely made of industry veterans who knew there was a better way to process these total loss vehicles. My personal background was in the automotive industry then in insurance claims at CCC Intelligent Solutions. 

When I was there, I saw the growing challenge of total losses (now over 20 percent of auto claims), and I saw the huge amount of money flowing into the two current auctions, Copart and IAA. I also saw trends in the claims world enabling insurers to go “fast” on total loss claims, which I believe moves this industry away from where the two legacy auctions built their competitive moat.

We launched the company to pursue exactly that and are now proud to be proving it for our first insurance customers.

What growth metrics have you accomplished over the last 12 months?

We signed our first insurance customers and are now “live” across the entire state of Texas with plans to expand into additional states.

We’ve built a strong team of industry experts focused on driving results. We integrated directly with partners like LossExpress and the National Digital Titling Clearinghouse to deliver better lien & title processes for insurers. We onboarded partners across Texas to support vehicle storage and transportation, and we launched an auction platform that is now integrated into the purchase flows of some of the largest buyers in the U.S. and aboard.

We've worked hard to create a smarter total loss workflow from assignment to auction and are continuing to build on that every day.

Within your domain, what is the current challenge that the industry is facing?

The biggest challenge is the duopoly of Copart and IAA. With limited competition, they’ve consistently raised fees, particularly on the buyer side. Those buyers are running a business, so they have to take all of those fees into account before they bid on the vehicle. Every year the two current auctions continue to raise those fees, it puts a downward pressure on how much buyers can bid on the vehicle itself. So, whether it’s directly (in the form of seller fees) or indirectly (in the form of buyer fees), it all comes out of the insurer’s pocket at the end of the day.

How does Salvato take a unique approach to providing value?

First, we decentralize the auction. There’s no need for storage yards, which means lower costs on our side and lower fees for sellers and buyers. 

Second, we handle title transfers digitally through the National Digital Titling Clearinghouse, eliminating physical paperwork and wet-ink signatures. It’s faster, cheaper and less error-prone. 

Third, our exclusive partnership with LossExpress allows us to secure letters-of-guarantee within an average of 2-3 business days, which further accelerates the cycle even for vehicles with a loan or lease on them.

What inspired the team to start this company?

Beyond my experience at CCC, much of our inspiration came from automotive auctions outside of the insurance world, particularly for used cars selling from dealer to dealer. In that market, companies like ACV Auctions and BacklotCars disrupted the incumbents by using online auctions to physically decentralize the auction and offer significantly lower fees to sellers and buyers.

We’re doing the same for total loss vehicles with insurers being a main benefactor of Salvato’s lower fees and faster cycle times.

Can you share any goals for the next 12 months?

Our top priority is to sign the next 10 insurance companies for pilots with us. We know no one is in the business of shifting all their volume at once. We just want the opportunity to prove it side-by-side on the metrics that are most important to your claims organization - whether that’s higher net salvage return, faster cycle time or better claims experience.

Our insurance customers are able to pilot without any IT work required on their side, which we know is critical. Right at the same moment an insurer assigns the vehicle to Copart or IAA, they assign it to us instead and let us take it from there.

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