HPI’S Guide to Insurance Write-offs

Used car buyers at risk of purchasing vehicles which aren’t fit for the road
 Used vehicle information expert, HPI, is warning buyers they need to fully understand the meaning of an “insurance write-off”. In 2010, four out of every 100 vehicles checked by HPI were an insurance total loss (often referred to as a ‘write-off’), meaning that the damage was substantial enough in relation to the value of the vehicle, that the insurer decided it was cheaper to declare it a total loss, rather than repair it.. Some insurance write-offs can be legitimately repaired and returned to the road, but others will have been damaged so badly they should be scrapped immediately, and there are many dodgy sellers looking to make a quick profit by selling one of these to an unsuspecting customer.

Nicola Johnson, Consumer Service Manager for HPI, explains, “When buying a used car, it’s always advisable to arm yourself with all the information available on that car. A vehicle that has been declared a write-off by an insurer is not straightforward – category C and D damage can be repaired safely and represent a possible bargain, but those in categories A or B should never reappear on the road. However it can be tempting for the criminal to gloss over the damage and try and sell on these potential death traps which have been disguised as a dream buy. Buyers need to take all precautions available to them to ensure they can identify a write-off and, importantly, what type of write-off it is.”

Any vehicle that has been declared a write-off by an insurance company is placed into an industry recognised damage classification, depending on its condition. An HPI Check will tell the consumer if a vehicle has been declared a write-off as well as providing the category of damage, giving people the complete picture of a vehicle’s history.

The ABI Total Loss Categories  (‘Write-Off’)

Category A: Scrap only – The vehicle has not been repaired following extreme damage. It was deemed too damaged to be repairable with little or no salvageable parts.

Category B: The bodyshell should have been crushed.  The vehicle has not been repaired following significant damage. It was deemed too damaged to be repairable however did have salvageable parts.

Category C: This vehicle was repairable, but the repair costs exceeded the vehicle value. The insurer chose not to repair for economic reasons.

Category D: This vehicle was repairable, but the repair costs were significant compared to the vehicle value. The insurer chose not to repair for economic reasons.
It is not illegal to repair and return written-off for salvage vehicles back to the road as long as they have passed a Vehicle Identity Check (VIC) with the Driver and Vehicle Licensing Agency (DVLA). Insurers notify the DVLA of all cars ‘written- off’ within salvage categories A, B or C.

Les Elliott, Chairman of MIAFTR and a representative of the ABI Salvage Code of Practice adds:  “The ABI Salvage Code specifically states that where an Insurer takes control of total loss salvage, such as a Category B, it is broken for spares and the body shell crushed.  However, where a person retains the salvage it can be returned to the road, but is subject to a VIC if the V5 is surrendered to DVLA.”

Until the VIC marker is removed, the DVLA won’t issue a registration certificate V5C. However, the VIC test alone is not a safety test and anyone looking to buy a car that has passed a VIC should seek to have it independently inspected by Autolign.

A check against HPI’s unique Condition Inspected Register, which is a database of written-off vehicles that have been repaired and passed an industry-approved inspection, will confirm if a category C write-off is in fact fit for the road.

Johnson concludes, “It’s easy to get carried away when looking for a car, but buyers need to ensure they take a step back to assess a car before purchase. Taking the time to check the history and ensure the vehicle is everything the buyer says it is can mean the difference between losing thousands of pounds – or even worse.”

THE DEVIL IS IN THE DETAIL – HPI Investigates Write Off Claim
One unfortunate motorist, who purchased a vehicle which had been declared a write-off was Gemma Humphries from Hampshire.

Gemma was a victim of a common misconception – that all vehicle history checks are equal. Gemma purchased a vehicle from a used car dealer, who assured her that it had passed an “HPI Check”. At the time the dealer promised to show her the HPI Check certificate, which never materialised.

After she had purchased the car, she experienced numerous problems with it and so took the car for an independent inspection, which uncovered the car had been involved in a major crash and the insurer had deemed it uneconomical to repair so declared the vehicle a Category C write-off.

Having been told the history check conducted was with HPI, Gemma got in touch with the company. After investigation, HPI discovered the check service that the dealer used was actually a cheaper alternative.

Despite this, HPI still investigated the issue and HPI’s Head of Operations contacted Gemma to offer her advice on how to get her money back. He also advised her not to use the vehicle again, as it could be dangerous.
Had Gemma been an HPI customer she would have been covered by the HPI Guarantee, which covers for any loss incurred from inaccurate or incomplete information supplied by HPI.

Gemma comments, “After my experience and all of the inconvenience I went through, not to mention the potential danger of using the car, I will always ensure I conduct an HPI Check in future. The assistance HPI provided me was invaluable, and helped me reach a resolution with my car dealer. I would urge anyone considering a used car purchase to ensure they check with HPI before they buy, to avoid going through a similar experience.”

Here is the link to thefull ABI Salvage Code of Practice