Car write-off explained

After your car has been in an accident, your car insurance company usually books it in for repairs. But sometimes it doesn’t make economic sense to repair the car. In this case, you might have a car write-off on your hands. And there are different kinds of write off to work around, too.

How does the process work, and what happens to your car? Let’s take a look.

What's the meaning of a written-off car?

A car write-off happens after your car is involved in an accident, and can happen in 2 ways:

• It’s damaged to the point that it’s no longer roadworthy
• The cost to repair the car is too great

This can happen as a result of a traffic collision, flood, or fire.

Insurance companies call car write-offs a ‘total loss’. But for this guide we’re going to use the term ‘write-off’.

Depending on the value of your car, a write-off can happen even when there’s superficial damage like a dent or scratch.

How does my insurer decide if a car is a write-off following an accident?

Car insurance companies have their own set of criteria for what counts as a write-off.

When you make a claim, your car insurance company assesses the damage and works out how much it would cost to repair your car.

If the repairs cost more than the car’s market value, or a high percentage of it, they may choose to write it off. This is because it’s not economically viable to repair the car in its current state.

What happens if my car is written off and how much will I get?

If your insurance company says your car is a write-off, they keep the car. They should pay you a settlement amount, which is usually the market value of the car.

Your car insurance excess would likely be taken off this amount.

For example, if your car's worth £5,000, and your total excess is £250, your settlement would be £4,750.

If you accept the settlement and don’t want to buy the car back, you need to:

• Send your V5C logbook to your insurance company
• Keep the ‘sell, transfer part-exchange your vehicle to the motor trade’ section from the logbook
• Tell the DVLA that your car is a write-off

What happens if my car is a write-off and it's not my fault?

In a non-fault accident, where your insurer can reclaim costs from the third-party, your no-claims bonus should remain intact.

Remember that in the insurance world, 'fault' and 'blame' aren't always the same.

If your car is written off and your insurer isn't able to recover their costs, you might have to claim on your own policy for the settlement. This is likely to impact your no-claims bonus, regardless of whether you were responsible for the accident.

With a written-off car, what happens to my car insurance?

Your claims history is a factor insurance companies look into when working out your car insurance costs.

If you’ve been in an accident – with or without a car write-off – you may see your insurance costs rise. And expensive claims tend to drive the price up further.

If your insurance is higher after an accident, there are some things you can do to keep your costs as low as possible.

For more information, check out our tips for cheaper car insurance.

Can I refuse to have the car written off?

If you disagree with your insurer’s decision, you can dispute it.

You’ll need to gather enough evidence to show either:

• The market value of the car is higher than the insurance estimate
• The cost to repair the car is lower than the market value of the car

You can agree to keep the car and take the settlement, minus the salvage value. Then it would be up to you to repair the car back to a roadworthy condition.

Write-off categories at a glance

Write-offs are grouped into 4 categories, depending on how repairable they are.

The 4 types of write-offs are:

What are the categories of car write-off?

Categories C and D changed in 2017 to Categories S and N respectively.

These new categories only apply to newly-written-off cars. So, you might still see cars marked as cat C or cat D when they’re sold.

Category N write-off meaning

The car can be repaired, and it only has non-structural damage. That covers things like lights and seats. You can still buy and sell cat N cars and repair them to be roadworthy.

Category S write-off meaning

The car can be repaired but has suffered structural damage. This covers things like the suspension and chassis. Cat S cars can be bought and repaired, but you have to re-register them with the DVLA.

Category A write-off meaning

The car is beyond repair. You can’t drive a cat A write-off and it has to go to the crusher.

Category B write-off meaning

The car is beyond repair, but not entirely without use. You can salvage parts from cat B write-offs, but the body shell has to go to the crusher.

Category C write-off

The car can be repaired, but it costs more than the car’s value. You can buy a cat C write-off and repair it back to a roadworthy condition. This category is no longer used.

Category D write-off

The car can be repaired, but the overall costs (not just repairs) are more than the car’s value. You can buy and sell cat D cars to get them back on the road. This category is no longer used.

If my car is a write-off, can I keep it?

Normally, when the insurance company writes your car off, they keep it.

If your car is a Cat S or Cat N write-off, you could buy it back from them. If this is something you want to do, tell your insurer as soon as you can.

Insurers work with salvage companies to dispose of write-offs. So if you delay telling them, you risk being too late to get the car back.

But before you commit to buying the car back, it’s worth having an independent mechanic look at the car and give an estimate of repair costs.

Then you can decide if it’s worth having the car back to repair.

After that, you can choose to keep or or sell your car.

What if I’m not happy with the repairs to my Cat S or Cat N car?

Let your insurer know straight away if you're not happy with the repairs to your Cat S or Cat N car.

Poor repairs are likely to lower your car's market value, or worse, put your own safety at risk. That's why it's important to have a professional check the repairs that are made, so fixes can be done before the car is returned to you.

If you find yourself going through many rounds of back-and-forth due to poor repairs, you might be able to reject the car altogether.

But this outcome only depends on who you're insured with, and whether they're likely to give you any form of compensation. For example, a cash equivalent to the car's market value or a car replacement.

Is it safe to buy a cat N or cat S used car?

Dealers must declare cars that are cat N or cat S. They can often look like a bargain, but you should be careful and check them thoroughly before buying a car that was written off.

Category N cars have suffered non-structural damage. This could be just a door panel or headlight fitting that was considered uneconomical to repair by the insurance company.

It can also cover cars written off due to flood damage, for example. Or cars that have had damage to the steering or brakes.

It's best to do a HPI check to find out exactly why it was written off. Then get a professional to make sure it's been repaired to a safe condition.

Category S cars have had structural damage to the chassis or frame, they must be repaired with professional equipment. There isn't a legal requirement for the work to be checked before the car goes back on the road, but it's a good idea to do so.

It's also worth noting that some insurers don't cover cat N or cat S cars, so your insurance costs may be high.

Always check with your insurer or get a car insurance quote before you buy to be sure.

Can I sell a Cat S car?

Yes, selling a Car S car is perfectly legal as long as its Cat S status has been officially declared.

Although, it may not be very easy. A Cat S car is likely to have higher car insurance costs, which means buyers would want to pay less for the car.

Buyers might also want reassurance that the car is properly repaired before parting with their money. So you may be required to pay for another car inspection by a third-party.

All of these extras mean you could end up selling with a price lower than you originally had in mind.

Another option is to sell your Cat S car to salvage buyers. These buyers are only interested in selling the car for parts.

Can I insure a Cat S car?

Yes, but insurers consider Cat S cars to be high-risk.

It's not easy to determine the market value or condition of a car once it's been written off. This means the car insurance policy is likely to cost more than usual.

What happens if my car is on finance and it’s declared a write-off?

If you have a written-off car that's still on finance, things get a little more complicated.

The final payout that you get from the insurer could end up lower than your outstanding debt to the finance company.

This might mean that you have to keep making payments on the loan even though you don’t have the car anymore.

Or your lender might ask you to pay back the outstanding amount in full.

From here, you have a few options:

• Negotiate with your insurance company to give you a higher settlement. You’ll need to provide evidence that the car’s market value is higher than what they’ve offered.
• Call your car finance lender and see if you can come to an arrangement with the outstanding amount.

If you’re worried about this happening, another option would be to consider gap insurance.

Gap insurance is a separate policy to your car insurance. It’s designed to cover the gap between the car’s market value and what you originally paid for it.

This should help cover any outstanding cost from your car finance.

Can I keep my private reg plate if my car is a write-off?

If your car has a personalised number plate, you can apply to the DVLA to take it off the car before it goes to your insurance company.

It’s worth telling your insurer as soon as possible that you intend to keep the reg plate.

Applying to keep the plate costs about £80, and you can apply online.

The DVLA may need to inspect the car before taking the plate off.

Once the plate is removed from the car, you should get a V778 retention document from the DVLA.

You can use this to put the private plate onto a new car if you wish.

For more information, visit the GOV.UK website.

Do I need to tell the DVLA about the write-off?

Yes, if your car is a write-off, you must tell the DVLA. You can do this by visiting the GOV.UK website.

You need to provide the following information:

• Your insurance company’s name and postcode
• Your car’s reg number
• Your V5C logbook. Specifically, the 11-digit reference number in the ‘sell, transfer or part-exchange your vehicle to the motor trade’ section.

If you don’t tell the DVLA that your car is a write-off, you could face a £1,000 fine.

If your car is a category C or S write-off and you’re keeping it, you also need to re-apply to the DVLA.