Insurance Auto Auctions Announces Share Repurchase Program

SCHAUMBURG, Ill., March 5 -- The management team and Board of Directors of Insurance Auto Auctions, Inc. , a leading provider of automotive salvage and claims processing services in the United States, today announced that it has initiated a previously authorized share repurchase program, and reiterated its confidence in the Company's progress and long-term outlook. In March, the Company has purchased approximately 650,000 shares of its Common Stock in the open market, or in block transactions.

Tom O'Brien, Chief Executive Officer, said, "Both the management team and our Board of Directors have confidence in the future of IAA. We are generating higher returns and offer more services for our customers than we have in the past, we are encouraged with our market share trend, we have a more favorable mix of business and our overall cost structure has been streamlined throughout the country. Looking forward, we have additional opportunities to enhance the business and expect to generate higher earnings and cash flow in the quarters ahead. We are proud of what we have accomplished to date and are excited about the future of IAA."

O'Brien added, "We believe the strategic initiatives we executed in 2002 have put us in a position to generate higher returns for shareholders going forward. Assuming stable volume levels during the year, we expect earnings of $0.75 per diluted share or more for 2003. We also expect cash flow from operations to exceed $25 million for the year. At the same time, we remain focused on preserving and deploying capital in ways that provide the best return to our shareholders. The decision to allocate capital to new and improved facilities and locations is a dynamic process and is based on customer needs, expected return on the capital and risk analysis. Our decision to allocate capital aggressively to our share buyback program reflects our confidence in our plan and the view that the current stock price makes IAAI an excellent investment opportunity."

About Insurance Auto Auctions, Inc.

Insurance Auto Auctions, Inc., founded in 1982, a leader in automotive total loss and specialty salvage services in the United States, provides insurance companies with cost-effective, turnkey solutions to process and sell total-loss and recovered-theft vehicles. The Company currently has 69 sites across the United States.

Safe Harbor Statement

This press release contains forward-looking information that is subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected, expressed, or implied by such forward-looking information. In some cases, you can identify forward looking statements by our use of words such as "may, will, should, anticipates, believes, expects, plans, future, intends, could, estimate, predict, projects, targeting, potential or contingent," the negative of these terms or other similar expressions. The Company's actual results could differ materially from those discussed or implied herein. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the Company's annual report on Form 10-K for the fiscal year ended December 30, 2001 or subsequent quarterly reports. Among these risks are: fluctuations in the actual cash value of salvage vehicles; changes in the market value of salvage; the quality and quantity of inventory available from suppliers; the ability to pass through increased towing costs; that vehicle processing time will improve; legislative or regulatory acts; competition; the availability of suitable acquisition candidates and greenfield opportunities; the ability to bring new facilities to expected earnings targets; the dependence on key insurance company suppliers; the ability of the Company and its outside consultants to successfully implement standardized key processes throughout the Company's operations as well as the ability to successfully complete the re-design of the Company's information systems, both in a timely manner and according to costs and operational specifications; and the level of energy and labor costs.

Additional information about Insurance Auto Auctions, Inc. is available on the World Wide Web at www.iaai.com .