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Trade Guide to Changes to Insurance Write-offs

When it comes to buying new and used cars you will often see adverts offering cars that have been Cat C or D (amended to Cat S or N) insurance claims, or have been written off by insurers. This can set alarm bells ringing for some, in this article we will explain changes to some categories and how buying such a car can often be a cheaper alternative to many offers in the marketplace, possibly providing you with years of happy and safe motoring.

Changes to Cat C and D (now S and N)?

Under new legislation, Cat C and D have been superseded by new groupings called Cat S and Cat N, however they still broadly refer to the same things. Both categories of vehicle can return to the roads if they have been properly repaired and validated by an insurer.

Cat C has become Cat S, referring to a structural total loss. As the name alludes this is reserved for vehicles declared a total loss in which structural damage has been sustained. The vehicle can go back on the road if it has been suitably repaired, bear in mind that the cost of repair may have outweighed what an insurer was willing to pay under an insurance policy claim.

Cat D has become Cat N, referring to a non-structural total loss. Where no structural damage has been sustained to the vehicle but the repair cost is more expensive than the pre-accident value, the assumption is that this code will likely be low value vehicles suffering relatively minor damage. Vehicles can go back on the road after suitable repair. 

In each case, the cost of repair must not be greater than the vehicle’s pre-accident residual value. For older or lower value cars, insurers can choose to write off vehicles even after relatively light damage, if their value is less than that of the cost of repair, this means that you can find a car with relatively light damage in these categories either sold privately or on trade plates.

What are Cat A and B?

For Cat A and B, there will be no to additional changes. Cat A usually refers to complete burn-outs or flooded vehicles, and Cat B identifies heavily damaged vehicles which cannot be put back on the road but may have some parts available for salvage.

Buying

The main reason for buying a Cat S or Cat N car is usually a financial one. Is it cheaper to buy the car and repair it, or to buy an equivalent undamaged model? If yes, then it does make good financial sense. There’s a risk here in that the damage may be greater than previously estimated, which means buying such a car can be a gamble. It would be sensible to take along a motor trade professional, ideally a repair specialist or mechanic to view and inspect a vehicle before committing to buying. it’s also an excellent way to source a rare vehicle, or one with a specification not often found in the marketplace. You could even find your dream car through Cat S or Cat N if you’re willing to take the chance on the initial cost and any potential repair issues.

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Some people may also buy a damaged car to repair and sell on for a profit. It’s key to research the future resale value and understand there may be a smaller market for a car that’s previously had accident damage. Also factor in many insurance companies insist that any previously-damaged car must have a professional inspection and be passed fit to drive by a trained engineer before granting insurance and this can be a significant additional cost. Sellers must clearly indicate any vehicle that has had accident damage as this is a legal requirement, failure to declare a car’s status could result in a court case so beware!

A final note of caution when dealing with Cat S and N vehicles, regardless of the quality of repair, accidents can cause more damage than is sometimes seen or repaired. Always do a thorough inspection of a vehicle and have it professionally examined before driving.


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