What to do with a written-off car
If you've just crashed your car, you may be in for a shock if it's deemed to be a write-off. Here's what you should do next.
What is a car insurance write-off?
An insurance write-off is when your vehicle is either so badly damaged that it’s unsafe to drive, or when the cost of repairs far outweighs the current value of your vehicle. This could be from damage caused in an accident, water or fire damage, or even accidental damage.
If your insurer deems your car to be an insurance write-off, you may receive a cash payout equal to the market value of the vehicle, provided you have the right level of insurance.
Who decides whether my car will be repaired or written off?
If your car is damaged in an accident, it’s usually in the hands of the insurance company’s assessor to decide whether the car should be repaired or written off.
Take a closer look at the fine print on your car insurance policy and you might be surprised to learn that most policies stipulate that it’s up to the insurer whether to:
- Repair your car
- Pay you to get it repaired
- Declare your car a total loss and write it off
When will a car be written off?
The way written-off vehicles are classified was updated by the Association of British Insurers (ABI) in October 2017. Before that, the categories were largely based on the insurance-estimated cost of repair work to the vehicle.
Car insurance assessors now rank the severity of the damage to a vehicle using updated write-off categories that are helpful for both drivers and used-car buyers. The updated categories also highlight structural issues that affect a vehicle’s safety:
Category A– The vehicle is unable to be repaired and has to be scrapped.
Category B– The vehicle is unable to be repaired and the body shell has to be scrapped but parts of it can be salvaged.
Category N– The vehicle has non-structural damage and is not safe to drive until professionally repaired. Other costs such as transporting the vehicle means costs would be greater than the vehicle’s value.
Category S– The vehicle has structural damage and is not safe to drive until professionally repaired. But the cost of the repairs is higher than the current value of the vehicle.
When a car is written off, what happens to it?
All unrepairable vehicles that fall into Category A or B will usually be dealt with directly by your insurance company and scrapped, although some serviceable parts might be salvaged from those in Category B.
You’ll need to send your vehicle registration document or log book (V5C) to your insurance company but keep hold of the yellow slip (V5C/3).
As the owner, it’s your responsibility to notify the DVLA about your vehicle being written off. Failing to do so could lead to a hefty £1,000 fine. And unless you apply to keep a personalised number plate, the vehicle registration number will be cancelled.
The vehicle’s details will be registered with the Motor Insurance Fraud and Theft Register (MIAFTR), which is a database containing records of written off and stolen vehicles, as defined by the Code of Practice for the Disposal of Motor Vehicle Salvage.
MIAFTR was designed and developed to help monitor vehicles written off for insurance purposes, to help trace and recover stolen vehicles and to help detect fraud. However, what happens to your car after that depends on why it was written off in the first place:
- If it’s written off because it is unsafe to repair. Its vehicle identification number (VIN) is recorded as a statutory write-off and the car can never be re-registered.
- If it’s written off because it’s uneconomical for the insurer to repair it. If you choose to have the car repaired, its DVLA status will be changed to “repaired write-off”. However, its value may be significantly affected if you try to sell it in the future.
What to do if your car is written off
If your car is declared a write-off by your insurer, you of course have the option to accept or decline its decision. However, keep in mind that the insurance payout you receive to help replace your car may be less than you had hoped.
This is partly because insurers consider a number of factors when determining your car’s market value, including:
- Its listed value and other current sales of the same model
- The pre-accident condition of your vehicle
- The distance on the odometer
However, your payout may also be smaller than you would expect because most car insurance policies allow insurers to reduce the amount payable by deducting:
- The excess payable on each claim
- Your car insurance premiums for the rest of the year
If you’re unhappy about your car being written off, and believe it can be repaired economically, you can challenge the insurers decision but you’ll have to act fast.
This is explained in more detail below.
Can a car that has been written off be re-registered?
Yes. If your car is a repairable write-off and placed in Category N or S, that is, it has only been written off because the cost of salvage and repair will exceed its market value, you can apply to have it re-registered.
The insurance company can give you an insurance payout and sell it back to you or an interested third party.
To keep a category S vehicle, you need to send the complete log book to your insurance company and apply for a free duplicate log book using form V62.
There are no notifications made to the DVLA or Driver and Vehicle Standards Agency when a repairable vehicle is placed in Category N and therefore you can keep hold of the log book.
Selling a car that has been written off
There is one very big drawback to repairing and re-registering a vehicle that has been written off: its status as a “repaired write-off” will severely hamper its resale value.
The MIAFTR is designed to protect consumers and prevent them buying a car that has been written off, and required substantial repairs to get back on the road. If you decide to sell the car in the future, the fact that it is listed on the register as a repaired write-off can have a big impact on how much prospective buyers are willing to pay.
What happens if a financed car is written off?
If there’s still finance owing on your car when it is deemed a total loss, the insurer is obligated to pay the financier any outstanding amount. However, in some cases there may be a shortfall or gap between the amount paid out by your insurer and the finance amount owing, which is where gap insurance can help. This is designed to pay the financier the outstanding loan amount when your comprehensive car insurer’s total loss payout is insufficient to pay out your loan contract.
Can I challenge a write-off?
If the insurer decides that your vehicle is uneconomical to repair and declares it a write-off, you may disagree with the cost quoted to repair your vehicle or your car’s salvage value. If this happens, you can dispute the assessment, but you only have a very short window in which to do so.
Insurers must notify the MIAFTR register within seven days of declaring a car a write-off. Once the register has been notified, it’s usually extremely difficult to get a write off decision changed.
If you do decide to challenge a repairable write-off assessment and push for your insurer to repair the car, you’ll need to gather evidence that shows the cost of repairs or salvage value are cheaper than the market value of your car. You should gather together the following:
- Quotes from smash repairers to outline how much it will cost to repair the vehicle.
- Quotes from salvage yards that reflect the salvage value of your vehicle.
- Evidence of the market value of your vehicle.
If you provide this information to your insurer straight away and ask them not to report your vehicle to the MIAFTR register, it may be possible to get the assessment changed. Of course, if you’re unhappy with the way you’re treated by your insurer, you can also complain through its internal dispute resolution service, and then to the Financial Ombudsman Service if necessary.
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