What happens when your car is written off?

Written-off car: What does it mean?

If you are told that your car has been written off, it means it is unsafe or too costly to repair. In this case, provided you had comprehensive car insurance, you'll get some kind of payout from your insurer.

The car's details will also entered into the Written-Off Vehicle Register (WOVR) in your state or territory. This means it is unable to be deemed roadworthy in future.

In most cases, your insurer will manage the disposal of your car. If you wish to keep your car, say for sentimental value, then you can request this.

There are 2 ways your car can be written off:

How much damage is needed to write off a car in Australia?

This depends on certain damage categories and thresholds set by the WOVR. Again, a car is written off when an assessor – arranged for by the insurer – deems the damage to be so severe the vehicle is unsafe to drive again. Or, the repair cost is near to or above what it would have been worth on the used car market.

What happens when a car is written off by an insurance company?

Once a car has been written off, its details are recorded in the written-off vehicle register (WOVR). If you held comprehensive car insurance, then your insurer will pay you a lump sum based on the policy you have.

If you had an agreed value policy, you'll simply be paid the amount that you agreed upon when you bought the policy. If you're liable for any excesses then these will be deducted from the final payout. All of this information will be available in your policy documents which would have been sent to you via email when you bought the car insurance policy.

If you had a market value policy, then your insurer will assess how much your car was worth before the accident and this will inform the payout amount. When determining this, insurers consider the following:

• Its listed value and other current sales of the same model
• The pre-accident condition of your vehicle
• The distance on the odometer

Do you get rego back if your car is written off?

Yes. You can recover your remaining rego from your state's roads and transport authority, and your unused CTP insurance from your CTP insurer.

How to check if your car has been written off

If you have recently been involved in an accident and you want to know if your car has been written off, call your insurer and ask them if they have assessed your vehicle yet. Depending on your insurer and the extent of the damage, it may take some time for a mechanic to assess the damage to your car.

What can I do if I disagree about my car being written off?

If you're unhappy about your car being written off, you have 2 options:

• If the car is a repairable write-off, you can apply to the roads and transport authority in your state or territory to have the car repaired and re-registered.
• If you think the car can be repaired economically, you can speak to your insurer and challenge their decision.

You'll need to be quick if you want to dispute an insurer's decision. After the insurer declares a car as written off, they have just 7 days to notify the Written-Off Vehicle Register (WOVR).

How to gather evidence

You should gather together the following:

• Quotes from smash repairers to outline how much it will cost to repair the vehicle
• Quotes from salvage yards that reflect the salvage value of your vehicle
• Evidence of the market value of your vehicle from a company such as redbook.com.au or glassguide.com.au

If you decide you want to make a complaint, you can do so through an insurer's internal dispute resolution service, and then to the Australian Financial Complaints Authority (AFCA) if necessary. Or you may be able to lodge your case with the car insurance ombudsman.

If my car's written off, can I keep it?

Yes. You can make a request to your insurer to allow you to keep a repairable write-off. In this case, you will receive the sum insured less any salvage value. Bear in mind that you won't receive as much but it may be important to you if the car has some sentimental value.

However, not all repairable write-offs can be legally re-registered. Check with your insurer before applying to keep a badly damaged vehicle.

What happens if a financed car is written off?

If there's still finance owing on your car when it is deemed a total loss, the insurer is obligated to pay the financier up to the amount you were insured for. For example, if you owe $30,000 to the financier (bank, car dealer etc) and your car was insured for $30,000+ then you're fine because the full amount can be covered. But if you owe $30,000 and your car is only insured for $25,000 then you'll have to make up the difference yourself.

This is why it really matters when you are taking out your policy and deciding whether you should insure the car for agreed or market value. If you can insure the car with an agreed value and ensure that value covers your repayments then this is smart, but it can be more expensive. If you insure your car for market value and it ends up being worth less then what you owe, that's when it can become a problem.

Selling a car that's been written off

There is one very big drawback to repairing and re-registering a vehicle that has been written off: its status as a “repaired write-off” will severely hamper its resale value.

The written-off vehicle register is designed to protect consumers and prevent them buying a car that has been written off and which required substantial repairs to get back on the road. If you decide to sell the car in the future, the fact that it is listed on the register as a repaired write-off can have a big impact on how much prospective buyers are willing to pay.

Frequently asked questions

• What's the process for re-registering a written-off car?

  It may be possible, depending on your circumstances, to re-register a written-off car. The option to re-register a vehicle is available in most states and territories. So, you'd need to check with the roads and transport authority in your area to find out what you have to do. For example, written-off vehicles in Queensland can only be re-registered if they've been fully repaired, and have passed a Queensland safety inspection and a written-off vehicle inspection.

  However, in New South Wales, written-off vehicles cannot be re-registered except in very limited circumstances. To be re-registered in NSW, your car must not have any non-repairable damage, and must also fit into one of the following categories:

  • The car was hail damaged, and you were the registered operator for more than 28 days before the damage occurred.
  • The vehicle was inherited from a will or letters of administration.
  • It was registered in your name for more than 28 days before the damage occurred.

• If my car is declared a total loss, can I still drive it?

  "Total loss" is effectively another term for "written off". You won't be able to drive your car again if it's been damaged to the point it isn't safe to be repaired and driven.