When a vehicle has been declared as total loss
When a car has been damaged extensively to the point where it cannot be repaired or the costs of repairs would exceed its current market value, it is then called an insurance write off. Every year hundreds of thousands of cars are involved in car accidents, thefts and fires. Insurance companies will classify some of these cars as write offs so that they do not spend more money on repairing the car than what's it's worth. So if you have reported an accident and your insurer believes your car is a write off, then don't despair as scrap metal also sells well and you may still be able to get a good amount of cash for it.
Categories for insurance write offs
- Category A is when parts can only be sold for scrap; the scrap value will not cover the cost of recovery or delivery in most cases.
- Category B is when the vehicle itself cannot be used again but non-structural and roadworthy parts can be used in other vehicles; the vehicle body shell must be crushed.
- Category C is when the vehicle can be salvaged but by doing so the parts and labour would exceed the value of the car so the insurer decides to write it off.
- Category D is when the vehicle is repairable but the insurer decides that the car is a write off. For example deliveries for the parts are too long and hiring a car is too expensive.
- Category F is when the car has been damaged by fire and the insurer decides not to repair it.
- Category X is when the car can be repaired and can still be roadworthy.
- Unrecorded insurance write off is usually when a driver does not report the accident to the insurer or was uninsured. An example would be a driver who has third party insurance only being involved in an accident that was their fault.
The procedure when dealing with a vehicle considered as a writeoff
If you've been in an accident and your insurer decides to class your car as total loss, then the following will happen:
- Your damaged car will be moved from the garage to another storage place usually at a salvage dealer to avoid extortionate daily costs charged by garages
- You will need to send original documents for the registration certificate (V5), MOT and insurance certificate.
- Checks will be made to the HPI (Hire Purchase Information) to find out whether you have any outstanding finance on the vehicle. Your claim will also be recorded against the MIAFTR (Motor Insurance Anti Fraud and Theft Register).
- After an assessment of the vehicle, a settlement proposal will be made to you and if you accept the value offered, the money will be credited to your account and more often than not, you will need to sign a form to say you're no longer the owner of the car but the insurance company is.
Having a car being written off by the insurance company is a lot of hassle. Insurers will usually offer a low value than what your car is really worth and most people accept this first offer as they do not know any better. If you can get a like for like replacement of your car with that money, then fine, grab it without hesitation but what if a similar car will cost you a lot more than that? Are you going to save up to get the car? No! You should look how much cars similar to the one you have are selling for. Get an average price and then contact your insurer and tell them that they are offering too little for the write-off car and you wouldn't be able to replace it. The key here is to negotiate until they give you a decent value for your car. Don't overdo it otherwise you'll be wasting your time but you need to be patient as well because the payout can take time if you're still negotiating but it's better to wait than having to find the money yourself. Don't rush into things as fast decisions are not very sensible when it comes to finance.