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UK Car Insurance - We Detail The Complete Process

A vehicle is written off when the cost of repairing it is more than the current valuation of a similar vehicle. Once the insurer decides that the vehicle is a total loss then they take the steps detailed below.

1) The wreck will have been moved from the car repairers to a salvage yard. This is done to lessen storage costs imposed by vehicle repair shops for vehicles in their yards.

2) The insurance company will ask you for the vehicle documents. That is the keys, MOT certificate if your car requires one,V5 registration document, service records, purchase receipts and details of any outstanding finance. They will ask for your Certificate of Insurance to be returned. They will need the original paperwork before they settle your claim. Copies to start with will suffice but will slow down the claim process.

If you ask them why they want these documents, they will likely tell you that they need to ensure that they have the right model of the car, that it possessed a valid MOT and proof of service record to establish that is has been maintained. These are all appropriate reasons. But they also need to validate your claim for fraud. Official documents have a number of anti-fraud measures designed by the issuing Government department. Careful perusal of the originals will help the claims official to establish quickly that these are genuine documents and not fake. If there is any doubt, they will use forensic science equipment to prove that the documents are genuine or fake. You would need to be a very clever fraudster to successfully forge all these documents. I would suggest that you let your insurers have the original paperwork as soon as they ask for them. Your claim will be delayed if you send copies.

3) Whilst you are waiting for your settlement proposals, your insurance company will be doing further checks as well. They will record the claim on the 'motor insurance anti fraud and theft register'. (MIAFTR) This is a UK data base that has recorded all insurance written off vehicles and stolen vehicles since the early 1980's. It checks your car's details against the contents of the database to see if the vehicle has ever been the subject of an insurance total loss before, or whether it has been previously stolen and not found. It checks against your name and address; post code; your car's registration number and VIN (vehicle identification number). If any details match further questions will be directed towards you, and the company might begin 'fraud investigation' mode.

The motor insurance anti fraud and theft register also automatically checks your vehicle against the Hire Purchase Information (HPI) database. If you borrowed money to purchase the vehicle and you still have an outstanding balance, it will be on this database. And your insurer will discover it. So be truthful and tell them about your outstanding balance. The finance company is the legal owner of your vehicle. Any settlement must be made to them until the loan is paid off. Anything left over is paid to you. Your claim will also be recorded on CUE (Claims and Underwriting Exchange). This happens automatically on all vehicle and household claims. Not all insurance companies subscribe but the vast majority do.

Problems occur when the outstanding balance of the loan is greater than the value of the vehicle. In this situation the insurance company does not pay off the loan in full. I remember a scheme for motor cycles. Teenagers went into a shop, bought a new motor cycle plus all the leathers, helmets etc with finance against the value of the bike. The interest rate on the loan was very very high. A few days later there was an accident and they would write it off (or it was stolen). The value of the motor cycle was much less than the combined purchase price plus the interest. It caused a lot of upset which was blamed on the insurer rather than the stupidity of the youngster for entering into such a bad deal with the shop.

4) Your insurer will be requesting bids for the salvage. The higher the salvage value the less the final cost of your claim. There has been much comment about vehicles which have been written off reappearing on the road, or being purchased by criminal gangs to aid their disguise of a stolen vehicle. The Association of British Insurers (ABI) have come up with a code relating to the disposal of vehicle salvage. All member companies comply with this code. The result is that most salvage is sold by the insurance companies to reputable salvage dealers. If the vehicle is damaged to an extent that meets listed criteria, it will be stamped with a code that makes it illegal to repair the car and return it to the road. Vehicles with less damage can still be fixed and put back on the road.

5) Once all of the above processes have taken place your insurance company will propose a settlement figure to you.

Their engineer will have looked up the trade publications to value the vehicle, adjusting these figures to take into account the age, condition and mileage of the vehicle, and his knowledge of the current car market. The final figure that he arrives at forms the basis of the settlement value given to you. Any policy excess will have to be deducted along with any outstanding finance.

Your insurer should make it clear to you precisely how much you will get and detail any adjustments to you. If you pay your premium by Direct Debit, the chances are that any remaining premium will also be deducted from the settlement amount.

6) Once you have accepted the offer (some insurers might require your signature to a document called a 'form of discharge') you will receive a cheque.

7) Your insurance company then own the remains of your vehicle and, subject to legislation and those ABI rules, can do what they want with it. This will always mean that they will sell the salvage.

Article Source: http://www.uberarticles.com/articles

This article was written by Terry Cod. He has many years of experience working as a claims adjuster with a number of UK motor insurance companies. His website www.instant-online-insurance.co.uk offers Tesco car insurance with online quotes and secure online payment.

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