When is a Write-Off Not a Write-Off?
Why Tens of Thousands of Written-Off Vehicles Could Still be Roadworthy
Approximately 400,000 vehicles are known to be written off by insurance companies each year, and the true figure could be even higher.
However, according to leading price comparison site Quotezone.co.uk, many drivers are unaware that some cars are written off not because they aren’t roadworthy, but because the cost of repairing them might be more than the vehicle is worth.
In fact, a car that is classed as a ‘Category N write-off’ may have only sustained minor cosmetic damage such as scratched paintwork, while a ‘Category S write-off’ might have sustained some structural damage that could be easily repaired, such as a dent in the car door panel.
Greg Wilson, Founder of Quotezone.co.uk, one of the UK’s leading car insurance comparison platforms, explains: “It comes as a surprise to many drivers to be told their car is a write-off as, far from being a tangled wreck, the damage may sometimes be very superficial. While each insurer has different guidelines, they will generally class the vehicle as a write-off if the cost of repairing the damage is more than the car is worth.
“So even if the damage is purely cosmetic – for example if the bodywork is dented or the paintwork is scratched – if it is costly to put right, the vehicle may be written off. If your car has a low value, even very minor repairs like this may not be considered worthwhile.
“Provided you have fully-comprehensive insurance, you should be covered up to the current market value of the vehicle, but if it’s written off you might not be able to find a comparable car for the same price so could lose out financially or end up with an inferior vehicle – particularly if you have customised it to suit your needs or it is an older model that you love and that would be hard to replace.
“If you’ve bought the car on finance, the insurance pay-out also isn’t likely to be enough to replace your car with a brand new motor, unless you happen to have GAP insurance in place to cover the shortfall.
“Drivers in these circumstances are often unaware that they may have another option. If a vehicle is classed as a category C, D, S or N write-off, it doesn’t have to be scrapped and they may be better buying it back from the insurer and using the pay-out to get it repaired rather than buying a replacement. And if you can live with a few dents and scratches, cosmetic damage may not need repairing at all if yours was a Category N or S write-off.”
Owners will need to negotiate with the insurance company and agree a settlement for the vehicle based on its pre-accident value, minus a sum to reflect its salvage value. They would then have to arrange the repairs themselves and take responsibility for bringing it back to a roadworthy condition.
Anyone considering this option should always have an independent mechanic inspect the vehicle and assess the repair costs. They should also be aware of the drawbacks.
Greg Wilson explains: “Insurers may consider it more risky to cover a former write-off so it will probably cost more to insure, apart from the fact that you will have probably lost your no claims bonus. Therefore it will be even more important to compare insurance prices. You will also need to declare its prior status to any future buyers, and it is likely to be worth less.
“While safety is always paramount, in some cases buying back a write-off could be the most cost-effective and convenient option – just do your due diligence and have the vehicle professionally assessed before you decide.”
When Does a Write-off Not Need To Be Scrapped?
A vehicle that is declared a write-off is placed into one of six categories:
- Category A: The vehicle can’t be repaired and has to be scrapped.
- Category B: The vehicle can’t be repaired and the body shell has to be crushed, but other parts could be salvaged.
- Category C: The vehicle can be repaired, but the work would cost more than its value. The vehicle can be used again if it’s repaired to a roadworthy condition.
- Category D: Repair work would cost less than the vehicle’s worth, but other costs (such as transportation) would make it uneconomical. The vehicle can be used again if it’s repaired to a roadworthy condition.
- Category N: The vehicle can be repaired following non-structural damage and can be used again if it’s repaired to a roadworthy condition.
- Category S: The vehicle can be repaired following structural damage and can be used again if it’s repaired to a roadworthy condition.
According to The Motor Insurance Anti-Fraud Register (MIAFTR), which is used by some insurers to record when a car is written off or stolen, around 700,000 vehicles are added to its register each year, though not all insurers are signed up to it.
This article is intended as generic information only and is not intended to apply to anybody’s specific circumstances, demands or needs. The views expressed are not intended to provide any financial service or to give any recommendation or advice. Products and services are only mentioned for illustrative rather than promotional purposes.