Car insurance write-offs: the ultimate guide

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Write-off categories
Insuring a second-hand write-off
Keeping a write-off

When you make a claim on your car insurance, your insurer might say your car is a "write off". That means they think it's not worth repairing the car, given how much it would cost.

But, when you dig into it, insurance write-offs are quite complicated. Here's what you need to know.

There are different kinds of write-offs

Insurance write-offs are given a category. The categories are A, B, C, D, N, and S. C and D aren't used anymore.

Category What it means
Category A "Category A" cars are completely unsalvageable and unsafe to drive. They have to be crushed, by law. This usually happens because the car's destroyed in a fire, or something.
Category B The body of the car has to be crushed, but if you want to keep any of the parts, you can.
Category C This has been replaced by category S. Category C meant you could save the car, but the insurer decided not to repair it.
Category D This has been replaced by category N. Category D meant you could save the car, and it would have been "economical" to repair it. But other costs - like getting it transported to garages and things - would make it "uneconomical".
Category N "Category N" cars have got non-structural damage. But they're still damaged enough that the insurer decided not to repair it. It's usually stuff like electrics. You have to get the car repaired before it's legally safe to drive.
Category S "Category S" cars have got structural damage. And given the cost of repairing that damage, the insurer decided not to repair it. You have to get the structural damage repaired before it's legally safe to drive.

The write-off process

Write-offs work like this:

  • Bad thing happens to car.
  • You make a claim.
  • Your insurer takes a look at your car.
  • If they decide it's not worth repairing, they'll tell you it's a write-off.
  • Your insurer gets the car valued, and they offer you a payout.
  • If you accept the payout, they give you the cash, and they keep the car.
  • If you're not happy with the offer, you can argue with it.
  • If you want to keep the car (and it's not category A or B), you can buy it back from them.

Insurance companies write off cars because they have to buy expensive replacement parts

Sometimes your car will be written off even if the damage isn't that bad.

That's because there are pretty high standards insurance companies have to follow when they repair your car after you make a claim. It has to be repaired to the same standard it was before the claim.

(This is mainly because the big insurance companies guarantee that your repairs will be done by their "approved repairer network" for 3 years - even if you sell the car.)

But that can mean the parts used are pretty expensive, which makes the cost of repairs go up pretty quickly.

Insurance companies will write off your car if it's "uneconomical" to repair

The other reason it takes surprisingly little for your car to be written off is that insurance companies are only looking at whether it's "economical" to repair your car.

Usually, this means your car's a write-off if it costs more than 50% or 60% of the car's value to repair it.

And it's all based on the value of your car now, not what you paid for it.

So if you've got an older car, and it's only worth £2,000, your insurer could declare it a write-off if fixing it costs £1,000.

Repair-to-value ratios

Insurers all have what's called a "repair-to-value ratio" that they use when deciding to write off a car.

It's a percentage: usually 50% or 60%.

If a car is worth £5,000, and the repairs cost £2,500, the repair-to-value ratio is 50%.

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Buying (and insuring) a second-hand, written-off car

Not all written off cars have to be destroyed. Only the really bad ones.

Because of that, people often prefer to keep hold of their write-offs and repair them. (More on that later.)

That means if you're buying a second-hand car, it could be a repaired write-off.

You need to be really careful when you buy a repaired write-off. For one thing, you need to be sure it's been repaired properly, or it might not be safe to drive.

And for another, driving an old write-off can have a pretty big effect on your car insurance.

If you're not sure if your car is written off, you can check online.

You have to tell your insurer your car was written off

You have to tell your insurer if your car's written off.

That's because some insurance companies won't insure written-off cars. And if they do, they might not insure all categories of write-off.

So let them know, and tell them which car you want to insure.

If you don't tell them, and you need to make a claim on it, your insurance company might not pay out. Even if they generally do insure repaired write-offs.

They'll probably cancel your insurance too, for "non-disclosure". Getting your policy cancelled by your insurer is pretty bad. It can make it tricky to get insured in future. At the very least, it usually makes your insurance more expensive.

But most of the time your insurance company will find out when you type in your car's registration number to get a quote. That data's usually sent automatically.

Insuring a write-off can be more expensive

If your insurer does cover repaired write-offs, it might still be more expensive than a non-written-off car.

That's because people who drive write-offs tend to make more claims, or because it tends to be more expensive to repair. Or just because they're concerned it's not safe to drive.

Some insurance companies won't pay out when you make a claim on a repaired write-off, either. And if they do, it might be a lot lower than it would be for a non-written-off car.

It's worth getting a few different quotes, and, if the price isn't right, consider switching.

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You can (usually) keep your written-off car (for a price)

If your insurance company writes off your car after you make a claim, you can usually buy it back from them if you'd rather keep it.

Unless it's a category A. Those cars have to be crushed, by law. It's not safe to drive. So you won't be able to buy back a category A or B write-off.

If you want to keep your car after it's written-off, you'll get the market value, minus whatever the insurance company could have got for it from the salvage dealer (and any other admin fees they charge).

So let's say your car is worth £4,000, and the repairs after your accident cost £5,000.

That wouldn't be worth repairing. So your insurance company would call it a write-off.

But if you wanted to buy it back, they'd let you do that. You'd have to pay whatever they could have got for it by scrapping it. Let's say that's £1,500.

If you bought it back, you'd get:

  • Your unrepaired, written-off car, and
  • £2,500 - the market value minus the buy-back fee

Most of the time, buying it back won't make financial sense. And that's because, even after repairs, a car that's been written off tends to be worth about 20% less. Once you'd spent the £5,000 getting it repaired, you'd be left with a car worth, at most, £3,200.

The maths
Remember, it's market value, minus scrap value and admin fees. Your car's value will drop by at least 20%, too.

How insurance companies value your car

There are lots of ways to value a car, and lots of companies that put together valuations.

Your insurance company will have their own company that they rely on to figure out vehicle values. If your car's written off, that's the report that they'll go with.

Most insurers rely on a company called Glass's, who come up with three different prices:

  • Trade-in price
  • Private seller price
  • Dealership price

If you're not happy with the valuation your insurer comes up with, you can hire an engineer to give you a first-hand report.

But remember that the valuation is the value at the time, not when you bought it. Your car might be worth a lot less when you make the claim than it was when you bought it.

You can argue with your insurance company over their valuation

If you're convinced your insurer's valuation is too low, you can negotiate with them.

Before you do, you need to get lots of evidence that the valuation isn't right.

Get as many quotes from different sources as you can. If they all come out much higher than the one your insurance company offers, you might have a case.

You can also list anything you've done to the car that you think should make it more valuable. Like a new set of tyres.

And if you're not getting anywhere, you can kick up a fuss with the Financial Ombudsman Service(FOS).

It's different if you scrap your own car

Deciding to get your car scrapped is different to having it written off by your insurer.

Getting your car scrapped doesn't automatically cancel your insurance, so you'll need to get in touch with your insurance company and cancel it separately.

If you don't tell them, you'll still be expected to pay for your policy.

You'll need to have your car insured right until the minute you sign it over to the scrapyard. Until then, it's still your car.

Because of our old friend Continuous Insurance Enforcement (CIE), cars need to be insured all the time, even if it's just sitting on your drive. The only way around it is to "declare your car off-road".

If you want to do that, you need to register a "Statutory Off-Road Notice" (SORN). It's all as exciting as it sounds.

(But remember that SORNing your car doesn't cancel your car insurance automatically, either.)

Once the scrapyard has taken your car away, it's their property, so you're not responsible for getting it insured. Make sure you cancel your insurance as soon as you can.

You'll need to tell the DVLA if your car gets written off

The DVLA puts a little mark against a car's Vehicle Registration Number when a car's written off.

By law, you have to tell the DVLA if your insurer writes off your car. Even if it's repairable. And even if you choose to buy it back and repair it.

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Updated on 5th May 2021