My car's been written off: what happens next

What happens when your car is written off?

If your car has been written off, your insurer pays you what it was worth instead of repairing it. Then you choose what happens to the car.

You can take the money and let the insurer take the car. With a Category S or Category N car, you can also ask to buy it back. Depending on the route, there may be paperwork for DVLA, the agency that keeps the vehicle register.

Three things decide how this goes for you. The category letter sets your options. The valuation sets your payout, and you can challenge it. And anything attached to the car, like finance or a private plate, needs sorting before you accept.

This page is part of our guide to car insurance.

What does the category letter let you do?

Your insurer gives a damaged write-off one of four letters. Two leave you no choice.

Category A and Category B cars can't be repaired. gov.uk says a whole Category A vehicle has to be crushed. On a Category B, the body shell has to be crushed, though other parts can be salvaged from it. So you can't keep either one to drive.

Category S, or Cat S, means structural damage that can be repaired. Category N, or Cat N, means repairable damage that isn't structural. gov.uk says you can use either again if it's repaired to a roadworthy condition.

So with these two, keeping the car is your call, as long as your insurer agrees terms. Our guide to insurance write-off categories explains all four letters in full.

How is the payout worked out?

gov.uk puts it simply: the insurer "pays you the current value of the vehicle, instead of the cost of repairing it". The insurer makes that decision too. gov.uk says your insurance company "will decide if the vehicle should be written off or not".

You'll hear two names for the same thing. The Financial Ombudsman Service, the free body that settles disputes with insurers, says insurers sometimes call a write-off a total loss.

The figure you're offered is usually the car's market value. The Ombudsman describes that as what your vehicle would have been worth just before it was damaged or stolen. It isn't the value you estimated on the form when you took out the policy.

Your excess comes off as well. LV='s guide to salvage codes describes the payout as the going rate for a similar car, "less the excess on your policy". Check your own policy schedule for the amount.

What if the offer looks too low?

You don't have to take the first figure. The Ombudsman says most of the complaints it sees about write-offs are disagreements over market value.

Its page on motor valuations and write-offs explains how it judges these complaints. It looks at specialist motor valuation guides, plus any other evidence. If the guides give similar values and the insurer's figure is in line with them, it's likely to agree with the insurer.

Sometimes the guides vary a lot. Then it checks whether the insurer's figure is backed by other evidence, such as adverts or an expert's opinion. If it decides the valuation is unfair, it tells the insurer to adjust it. That means the highest figure in the guides or the value the other evidence supports, whichever is fairest.

Adverts count now. The Ombudsman says it typically considers them, because the guides report cars selling at or close to advertised prices. So collect adverts for cars as close to yours as you can find, matching the model, the year and the mileage.

Then ask your insurer which guides it used and what it took off, and get the answer in writing.

Still can't agree? Complain to the insurer first, then to the Ombudsman. Our guide to insuring a Cat S or Cat N car sets out the time limits for both steps. It also covers the Financial Conduct Authority's review of how insurers value written-off cars.

What do you have to tell DVLA?

That depends on whether the car stays with you. gov.uk describes two routes, and they're different.

If the insurer takes the car

gov.uk says you must tell DVLA if your vehicle has been written off and scrapped by your insurance company. It treats that as the same as selling the car to your insurer. You can be fined £1,000 if you don't tell DVLA.

Send the V5C, the log book, to your insurer, but keep the yellow "sell, transfer or part-exchange" section back.

The online tell DVLA service asks for its 11-digit reference number, plus your insurer's name and postcode. Prefer to use post? Fill in the yellow section and send it to DVLA instead.

DVLA then sends a letter confirming you're no longer the keeper, the person the car is registered to. You also get a vehicle tax refund for any full months left.

If you keep the car

gov.uk has a separate section on keeping the vehicle. For a Category S car, you send the complete log book to your insurer and apply for a free duplicate using form V62. DVLA records the category in the log book. For a Category N car, gov.uk says you can keep the log book.

Your insurer reports the category as well. The salvage code from the Association of British Insurers (ABI) is the industry rulebook for write-offs. It says insurers must log every categorised vehicle on the industry's anti-fraud and theft register. The code says that entry meets the insurer's own duty to notify DVLA.

The part gov.uk leaves unclear

Does the £1,000 duty apply if you keep the car? gov.uk doesn't say either way in plain words. Its general write-offs page lists "tell DVLA" as a step before it reaches keeping the vehicle, and says a Category S keeper "also" needs the log book steps.

But that "tell DVLA" step links to the online service. The service is worded for a car that's been "written off and scrapped", and it ends with you no longer being the keeper.

The ABI code points the same way as the service. It says the keeper is responsible for notifying DVLA when a vehicle is passed to an insurer after a claim is settled. Keep the car and you stay its keeper. You hold on to the log book for a Category N, and apply for a duplicate yourself for a Category S.

I read that as meaning the log book steps are the ones that apply to you. But that's my reading, not a ruling from DVLA. So ask DVLA or your insurer which steps apply, and keep the answer in writing.

Can you buy the car back and repair it?

For a Category S or Category N car, yes, if your insurer agrees. gov.uk says the insurance company will "give you an insurance payout and sell the vehicle back to you".

You'll see set buy-back percentages quoted online. Ignore them. Terms vary by insurer, and LV=, for one, says keeping the car is "subject to your insurer's retention guidelines". So ask yours what it'll take off before you decide.

The deduction is for the salvage. The Ombudsman normally thinks it's fair for an insurer to take off what it would have made from selling the damaged car. But it expects the insurer to show evidence for that figure. Ask to see it.

Make that clear early too. The Ombudsman hears from owners whose cars were scrapped when they'd wanted to keep them. Tell your insurer in writing that you want the car, before you accept any payment.

Then there's the repair. gov.uk says you can use the car again if it's repaired to a roadworthy condition. Check your insurance too. Our guide to insuring a Cat S or Cat N car covers what to tell an insurer and what it can cost.

The category stays with the car. Your insurer logs it on the industry register, and DVLA notes a Category S in the log book. Future buyers who run a history check, including our Comprehensive check, will see it. So weigh the resale value as well as the repair bill.

What if the car's on finance?

Tell the finance company straight away. On hire purchase or PCP, short for personal contract purchase, the finance company owns the car until you make the final payment.

Ask it for a settlement figure, which is the amount needed to clear the agreement. That's your outstanding finance, the money still owed on the car.

Then ask your insurer who the payout will go to, and compare the two numbers. A payout smaller than the settlement figure leaves a gap.

That gap is what GAP insurance is for. GAP stands for Guaranteed Asset Protection, and it's a separate policy from your motor insurance. The Ombudsman says it covers the difference between the car's market value and an agreed amount. That amount might be what's left on your loan, or what you paid for the car.

Two of the main types work like this. Finance GAP pays your finance provider the difference between the motor payout and what's left on the loan. Return to invoice GAP pays you the difference between the motor payout and what you paid for the vehicle.

Dealers and lenders usually sell it, so check the paperwork from when you bought the car. The policy wording decides what it pays.

The Ombudsman is clear on one point, though. A motor payout that's too low is a complaint for your motor insurer, not the GAP insurer. That's one more reason to check the valuation before you accept it.

No GAP cover? Talk to the finance company before you stop any payments. Our guide to outstanding finance explains who owns a financed car and why.

What about a private number plate?

Act before you accept the settlement. gov.uk lists taking the registration number off the vehicle as a step for anyone who wants to keep it.

Timing matters. If the insurer sells the car as salvage before the number is off it, the number goes with the car. So apply first, and tell your insurer you're keeping the number. Our guide to keeping your private plate has the forms, the fee and the timings.

Questions people ask after a write-off