Why do insurance sell cars that are totaled?

As a condition of the insurance the insurance company owns your car when it is totalled - its their car and completely up to them what they do with it to try to get back some of the money - you can't have it.

"They told me I have to have a new car by Tuesday"

Makes no sense, you're full of something.

You think they are just supposed to store them out back and never sell them ?

Chances are you wont be able to buy it because most are sold at salvage auctions where only salvage yards and rebuilders can buy.

Plus, you wouldn't have the first clue how to get a clear title for it so you could buy a tag.

Its WAY out of your competence level.

Worry about paying off your loan.

Also, your insurance company cannot tell you when you must have another car by.

Call that person back & cuss them out. Because they are lying to you.

No you don't. With all the electronics in vehicles you don't want that migraine headache. I also believe that them selling it is illegal because of mold issues.

A car is totalled when its value, following the incident, is below a certain percentage of its book value. Usually around 65%. An insurance company isn't going to spend 2900 to fix a car that's worth 3000. However, the car still has a value and the insurance company sells it to realise this value.

There's a lot of money to be made in breaking down unroadworthy cars and selling the spares.

Trust me, you don't want it back. A simple crash, you can have stuff fixed and be on the road again in another week. But a flood car will never be fixable: wet electronics are the kiss of death.

"I couldn't buy my car back because of the issues down the road".

You need for your insurer to explain to you what these issues might be.

Whenever a car is deemed totaled by an insurer you should be given the option of accepting a check for the fair market value. However, you know you have the option of not accepting offer and keeping the vehicle to do as you please. At this point it is still your vehicle. Or, if you have already accepted the insurers' pay out it now belongs to the insurance company to do whatever they may please.

go and bid for it ,... NOW .............

No. Don't get it back. If it's water damaged, the least it could have is a stink odor for life.

They do not have facilities to scrap them.
In the UK totalled cats are classed. One class has to be crushed. One class has to be stripped for spares the rest crushed. Other classes can be sold and returned to the road.
Cars are sold to scrap dealers.