So you’ve been involved in a car accident and you’re insurer is saying that the prognosis for your baby (your precious car or bike) is not great: she’s been deemed a write off. So what now? And what exactly does an ‘insurance write off’ mean?
If it’s time to say goodbye to your car anyway, this might not be such bad news. But if your car is new or it’s been fitted with pricey modifications, the verdict that your vehicle is a write-off could leave you slightly bewildered. These insights will help you get your head around the situation and work out what to do next.
What Is An Insurance Write-off?
A total loss or insurance write-off is the phrase used within the insurance industry to say that the damage sustained in an accident has made it either unsafe or uneconomical to fix. Usually this means that the projected cost of labor, parts and paints you’d need to repair the car will add up to more than 50-60% of the market value of the car or bike before the accident happened. The ‘repair up to’ threshold will depend on which company you have your car or Bike insurance with. Depending on who you are insured with, you may be able to push back on the write off decision, but you’re only likely to be successful if the cost of repairs comes to only slightly more than their standard threshold for repair.
How Much Will The Payout Be?
The first thing your insurer will do is calculate the “pre-accident value” of your car. Essentially, how much would your car or bike be worth on the current market if you’d sold it, instead of crashing it? Once they have a value, you will be offered a payout in cash. This value will be the pre-accident value, less excess that is applicable in your situation. You will have the opportunity to dispute the offer if you think your vehicle is worth more than your insurer has valued it at, but if you’re going to go down the dispute route, be prepared to provide your insurer with examples of other vehicles of a similar age, spec and engine size currently for sale at a higher price than the value your vehicle has been assigned. If you take the payout, your insurer retains your car or bike for salvage. Depending on the vehicle damage, you can expect your car to either be sold to a salvage company for resale for repair and/or scrap.
Can I Repair My Vehicle Myself?
This gets complicated. In short: maybe. If you don’t want to part with your car, you may be able to retaining it and fix it yourself, especially if you’re lucky enough to have contacts in the car repair world who can arrange you a decent price on parts and repairs. You’ll need to check with your insurer whether your vehicle is safe to repair, which will come down to what salvage category it has been assigned. Remember that the value of your car will always be lower because it has a salvage category assigned, having been an insurance write off. In some cases, your vehicle may be too damaged to repair safely because of structural damage. This is determined on a case-by-case basis, and is usually beyond dispute.
Whether your bike is your pride and joy, or your car is only to get you from A to B, a total loss can be a stressful situation to handle. These points should help you get it sorted.