What happens if my car is written off?
If your car is a write-off, it's no longer roadworthy and ownership of it is transferred to your car insurance provider. In this guide we'll explain the ins and outs of having a car written off and how your insurance can help.
Key takeaways
If your car is deemed a write-off due to damage or an accident, comprehensive car insurance typically covers the situation.
The insurer will pay you the market value of your car before the accident or damage.
Making a claim for a write-off could potentially impact your no-claims bonus and raise your future premiums.
When the unexpected happens and your car is involved in an accident, the term 'write-off' suddenly becomes a significant part of your vocabulary. It's a situation no driver wants to face, but understanding what a car insurance write-off entails can help you navigate the process with confidence.
This article will guide you through the maze of write-offs, from what they are to how they can affect your insurance and finances.
What you need to know
You can contest a settlement offer if you believe your car is worth more than what your insurance provider is offering.
You can buy your car from your insurance provider after it has been written off.
Your policy will be cancelled soon after your car has been written off.
It is unlikely that you will get a refund on your premiums after your insurance has been cancelled.
After your car is off-road, you can get a road tax refund for any remaining months left of your vehicle tax year.
What is a car write-off?
If your insurance company has declared your car a write-off, this is usually because your car would be too expensive to repair, or the damages are so significant your car is beyond repair.
Contrary to popular belief, a written-off car does not mean your car can no longer drive, it relates more to the damages the car has incurred.
There is some negotiation allowed within this process:, you can insist on another evaluation of your car, however insurers have a strict policy that if the damages equate to more than (usually) 40% of the car's worth, they are highly unlikely to change their decision to write off your car.
The aftermath of a write-off
After your car is declared a write-off, insurers typically offer a settlement fee. This amount is based on the car's pre-accident value, taking into account any excess that you're liable for.
There are four categories of write-offs, and depending on which one your car falls into, you might have the option to buy it back and undertake repairs. However, be aware that owning a car that has been in categories S or N could lead to higher future insurance costs.
Car write-off categories
The level of damage and vehicle safety are indicated by write-off categories. Since 2017, these have been updated to categories A, B, S, and N, focusing on the type of damage and the difficulty of repairs. It's worth noting that older cars might still be listed under the previous categories C or D.
Immediate steps after your car is written off
If your car is written off, the insurance company usually takes care of collecting and scrapping the vehicle. As the owner, you should ensure that any personalised registration numbers are transferred and inform the DVLA to avoid potential fines.
What insurers do with written-off cars
Insurance companies often sell cars that fall into categories S or N. However, cars in categories A or B are usually crushed due to the extent of their damage.
Can you buy back your written-off car?
Yes, you can buy back your written-off car dependingon the extent of the damage and its category. It's essential to carefully assess the repair costs and ensure that the car can be made safe and MOT compliant. Keep in mind that insurance costs may increase after the vehicle is repaired.
Purchasing a category S or N car
Cars in categories S or N can be cheaper to purchase, but they may come with higher insurance premiums. It's advisable to check insurance costs before committing to such a purchase.
Disputing a write-off decision
If you believe your car has more than just monetary value, you can dispute a write-off decision. You have the option to negotiate with the insurer or keep the car and have the salvage value deducted from your compensation.
You do not have to accept the settlement offer right away; you will have at least 5-7 days to make your decision and if you believe you should be owed more, you can contest the offer. In order to prove to your insurer that your car is worth more, you will usually need to provide evidence of this.
If you can find your same type of car with similar mileage, age and spec being sold for more than what your insurance company are quoting you, you will be able to dispute their number. However, only one example won’t cut it. If you have a few to back you up, you will have a more solid case to prove that your insurance company should increase their payout amount.
You can also decline the settlement offer completely and buy your car from your insurance company. This option will allow you to repair all the damages yourself and keep your car.
Insurance status post write-off
Once your car is written off, it's no longer insured under the original policy. If you acquire a new car, even with the same registration number, a new policy will be required. If you have a multi-car insurance policy, the other vehicles will still be covered.
What happens to my insurance after my car has been written off?
Your insurance will be cancelled after your car has been deemed a write-off since there is no longer a car to insure. Every policy is different and so is every insurance provider, but most of the time, your insurer will give you around 30 days to find a new car to switch your policy to.
Unfortunately, if it's not possible for you to obtain a new car within the time frame your insurer has given you, this will count as a cancelled policy that you will have to disclose when you take out another policy in the future.
If you have paid for your insurance annually
If you have paid for your car insurance annually, getting the money back for your insurance won’t be easy. Sometimes, it is not a possibility at all, but on some policies, you may be able to get the rest of your premiums back for the time that is left on your policy. This is often based on fault. If you are not at fault for the accident that occurred, you may be able to get a refund back on the rest of the time remaining on your policy. However, if you were at fault, it is highly unlikely that you will be able to get any money back on your premiums.
Insuring a written-off car
If you have a car that has been recorded as SORN on the logbook, you are still able to insure that car after it has been fully repaired, has passed its MOT, and is off SORN therefore, allowed back on the road. You cannot insure a car while it is SORN. While comparison site journeys and many providers don’t have a specific question asking whether your car has ever been written off in the past, it is still worth telling your insurer after you have run a quote.
While this may impact your premiums slightly, if you do get into an accident or need to make a claim that involves your insurance provider needing your logbook, and they see the undisclosed write-off, it could invalidate your policy preventing any pay outs for claims or settlement offers for a written-off car.
Compensation for your written-off car
The compensation you receive for a written-off car is based on its pre-accident market value, minus any excess. However, the payout may not always cover the cost of a new car, especially if your car has depreciated over time.
If you feel the payout is insufficient, you can raise a complaint with the insurer or the Financial Ombudsman Service. GAP insurance can be a lifesaver in these situations, covering the shortfall if the insurance payout doesn't cover replacement costs, though it's typically available for vehicles less than three months old.
Road tax
After your car has been declared SORN (written-off) you can cancel your road tax by informing DVLA that you no longer have the vehicle or that it has been declared SORN and is now off the road. You can then expect a full refund of any remaining complete months of your annual road tax year. It is not possible to transfer your road tax to a different vehicle.
Outstanding finance on a written-off vehicle
If there's outstanding finance on your vehicle, the insurance payout may not cover it. You might need to negotiate with the insurer or finance provider, or rely on GAP insurance to cover the difference.
Your car insurance
Having adequate insurance is crucial for receiving proper compensation if your car is written off. The right insurance ensures that the car's value is compensated. Using MoneySuperMarket to compare quotes can help you find suitable cover that provides peace of mind.
