No matter how well you look after your car, it takes one bad driver to damage it beyond repair. It's heartbreaking, to say the least. If you're insured, the auto insurer will likely give you some sort of compensation for your loss, but probably not enough to bring your car back. Most likely, they will send your car to insurance auto auctions to recoup their losses.
Hang on a second... So you have to lose your car and the insurer gets to resell it? That doesn't sound fair at all! Let us explain.
Assessing the Damage
If your car will cost more to repair to its original state than the insured value, the insurer will likely write it off. However, it is not just a visual inspection. The company will send out an assessor to review the damage and the age and condition of your car. They will consider the availability of parts, as well as historical salvage data for the type and model of the vehicle to determine an accurate write-off threshold.
Perhaps you have a panel beater friend who can repair the car for cheaper using second-hand parts to save on repair costs. However, this will typically not be allowed. Specialized assessors will determine the parts that can be used, as the bank may require warranties.
The Decision
If the insurer decides to write your car off, they will process your claim as usual. They will probably ask for signed change of ownership forms and original registration forms.
You will have the option to have the vehicle repaired privately, if it is not financed, but the insurer will not be liable for any unseen damages or costs. Since the bank owns your financed vehicle, the insurer has to abide by the financier's rules of conduct. Therefore, you should not waste your time trying to reverse their decision to write the car off.
Salvage Yard
Once your claim has been settled, the insurer's salvage contractors will perform a change of ownership and the car will belong to the insurance company. The salvage contractor will then auction off the car at an insurance auto auction.
If you change your mind and decide to buy your vehicle back, you will have to attend the auction and make the best offer. The insurer will not be held accountable for the quality of the repair work, as they only work with contractors who have service level contracts in place.
Insurance auto auctions don't only sell totalled cars, but also vehicles that have been stolen or repossessed by the bank. So if you need a new car in a hurry and at a limited budget, you could buy one from the auctions.
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