What exactly is an insurance write-off?

After a road mishap, you will be told by the car insurance company that your vehicle is written off. This sounds bad as it means your car will be retained by their company without paying cash for your loss.

“Write off” is a term in industry that means your car is unsafe running on the road as its damage is excessive and subject to uneconomical repair. This type of repair is determined on a repair-to-value ratio that is considered different among insurance companies and cars. Assessors are hired by insurance companies to assess the repair cost after making thorough inspections its overall condition and analyzing extent of its damage.

Rationale why cars get written off

Following strict guidelines, companies of car insurance are required to restore the car’s condition before the crash that can be expensive. After a car crash and it suffered damage, your insurer will have an assessor determine the cost of repairs and will be claimed uneconomical as it is around 50% of the vehicle’s value – this is classed an insurance write-off.

The car is kept by the insurer and you will receive a cash payout for the loss based on its ‘market value.’ However, your car is not really the mangled twisted tangle of metal, you might have imagined.

Things to do if your car is considered write-off

  1. Immediately notify your insurer or a reliable insurance broker;
  2. Remove personal items and apps from the vehicle;
  3. Get a Vehicle Road Tax refund from the Driver and Vehicle Licensing Agency (DVLA).
  4. Submit extra key to insurers if required.
  5. Submit MOT certificate, registration document and any other documentation to your insurer to prove the value of the vehicle.
  6. Submit outstanding balance in writing like Data Protection from your lease or finance agent to prevent insurers from acting on your behalf.
  7. Make advance evaluation of your vehicle’s value to compare with the offer from your insurers.

Written off cars are categorized into four:

Category A is the worst as the car is considered as junk and no longer drivable;

Category B is car write-offs when extensive damage of the vehicle makes it unworthy to travel but a few parts can be recycled;

Category C gives your car second chance to run the road again after repaired; provided the cost does not exceed 50% of the car’s value.

Category D is a write-off where the vehicle could run the road for it could be repaired with the costs relative to the vehicle’s value.

According to British Insurers’ Salvage Association Code, cars under Category A and Category B are broken up for spares and the body shells crushed. But cars under categories C and D are sold by the insurance warranty company. After repair and passing a Vehicle Identity Check with DVLA, they are placed back on the road.

Different companies use different value repair ratios. Be sure to find out the figure from your own insurer. Calculation of repair-to-value can result in surprising write-offs when the damage to your car is not particularly serious. In some cases, repair cost could escalate causing the insurer to declare the car a total loss.

This information will go a long way in helping you handle car insurance write off.

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