Many states have gone to this "Salvage Title" system because of fraud.

Rings of car thieves have stolen new popular cars and stripped them
leaving the carcass on the street.  When the insurance company sends the
remains to auction they buy shell back and re-assemble it.  In states
where there is no salvage title issued, they get a nice, clean title
when they buy the car at auction and can then sell what looks like a
legitimately traded vehicle.

With old cars it is more an issue of forcing you to get an inspection
(including repair receipts) before you put the car back on the road.  I
am going through this right now, but it is no big deal, just a nuisance.
--
Stuart MacMillan
Manager, Case Program
800-909-8244 ext 208

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