Category C vehicle – insurance and other implication?

[Uncle Fester]

Hi

I would appreciate some advice please.

Last week I had a scrape in my car; which has resulted in cosmetic damage to one door and a quarter-panel. Because of the age and low value of the car; my insurance company have offered me a sum of money to write the car off. I told the insurance company I was reluctant to do this as the car is mechanically sound. They have responded with the offer of a smaller payment and I retain the car as a category ‘C’ vehicle.

I don’t really understand the implications of having category C vehicle and would be grateful if anyone could clarify this for me.

Some questions come to mind. Would my vehicle still be insurable? If it is, would the premium be higher, and if so; by how much?

If I were to claim on my insurance in future; would any payment be restricted due to the fact that the insurance company have deemed the vehicle category C and that they already ‘paid out’ on this vehicle?

If any future insurance claims were restricted in any way; is there any point in having Fully Comprehensive cover instead of Third Party Fire and Theft?

Are there any other consequences of owning a category C vehicle that I should be aware of?

Thanks.

 

[Deleted sulking member 63079]

Some insurers may charge more, or refuse to insure, a Cat C vehicle, although I'm assuming your insurer will continue to cover you, or they wouldn't have suggested it. And obviously the re-sale value of your car will go down. So, for insurance purposes, if you had another claim, they could offer to pay out the value of another Cat C vehicle of the same type. Which you technically won't have lost any money on, because they're paying out the difference now.

 

[nilagin]

There probably won't be any benefit in insuring the vehicle as TPFT as there is very little between the cost of the two. If the vehicle is to be repaired, then there will be little impact on the value of the vehicle provided you get a report to the effect the vehicle has been repaired properly. If the car is valued at less than £2k, insurers consider it to be a banger and less likely to be driven with care and will be considered a higher risk than a more expensive car.

 

[Uncle Fester]

Some insurers may charge more, or refuse to insure, a Cat C vehicle, although I'm assuming your insurer will continue to cover you, or they wouldn't have suggested it. And obviously the re-sale value of your car will go down. So, for insurance purposes, if you had another claim, they could offer to pay out the value of another Cat C vehicle of the same type. Which you technically won't have lost any money on, because they're paying out the difference now.

Thanks for this; very helpful.

 

[Uncle Fester]

There probably won't be any benefit in insuring the vehicle as TPFT as there is very little between the cost of the two. If the vehicle is to be repaired, then there will be little impact on the value of the vehicle provided you get a report to the effect the vehicle has been repaired properly. If the car is valued at less than £2k, insurers consider it to be a banger and less likely to be driven with care and will be considered a higher risk than a more expensive car.

Thanks.

The value of the car was less than £2k before the accident.

I'm considering repairing the cosmetic damage but to a lesser standard than the insurance company require. The insurance company would want the quarter panel and the door skin to be replaced. I'm considering have the dents knocked out and the scratches filled in; which would be less costly though cosmetically not as good.

I'm not too fussed about the resale value of the car as I tend to run my cars into the ground and scrap them when they are no longer economically viable to keep running.

Are there any other implications of running a category C car?

 

[OldCarlos]

Just a quick question. Is their offer far lower than you'd expect? (not enough to replace to a similar vehicle) You can always reject their initial offer & see what they come back with.

 

[Deleted sulking member 63079]

Thanks for this; very helpful.

I work for Aviva in the day job, but in IT, not in insurance.

From what I can see, we'd refer a Cat C to underwriters, who *may* add an additional premium. But it'd depend on make of car, value of car before, value of car after, repair work undertaken, so impossible to give an answer. A quick look at other insurance companies shows that Admiral an LV both cover Cat C cars, so I imagine most of the other big players do too.

 

[Uncle Fester]

Just a quick question. Is their offer far lower than you'd expect? (not enough to replace to a similar vehicle) You can always reject their initial offer & see what they come back with.

I'm actually quite happy with the insurance company offers. The vehicle cost me £1500 a year ago. Their offer to write off the car would mean they would pay me £1325. The offer for me to keep the car as a category C car would mean me getting a payment of £1000.

I could replace the car for a similar vehicle with the payment for writing the car off. However it would almost certainly mean getting a vehicle with higher mileage and unknown mechanical condition. The car I have has been thoroughly checked over by a mechanic friend of mine and I know that it basically sound. That's why I'm reluctant to change it.

 

[Uncle Fester]

I work for Aviva in the day job, but in IT, not in insurance.

From what I can see, we'd refer a Cat C to underwriters, who *may* add an additional premium. But it'd depend on make of car, value of car before, value of car after, repair work undertaken, so impossible to give an answer. A quick look at other insurance companies shows that Admiral an LV both cover Cat C cars, so I imagine most of the other big players do too.

Thanks for that; it very reassuring. I was worried that I wouldn't be able to insure the car. Of course; if the 'loading' on my current premium is extreme (i.e. the premium doubling or more) the car may still not be worth keeping.

Although; I can't see why insurance should cost more as the damage is cosmetic and the vehicle is no less road worthy now than it was before the accident.

 

[Deleted sulking member 63079]

Thanks for that; it very reassuring. I was worried that I wouldn't be able to insure the car. Of course; if the 'loading' on my current premium is extreme (i.e. the premium doubling or more) the car may still not be worth keeping.

Although; I can't see why insurance should cost more as the damage is cosmetic and the vehicle is no less road worthy now than it was before the accident.

It might not, some insurance companies won't load it at all, some might have some automatic loading for category C and others may refer it to underwriting to take a closer look at it. It may be that, if you don't bother to get it repaired, they view it as a higher risk as you're not worried about prangs, there's loads of stuff that goes into insurance ratings and then some of it is influenced by the risk profile the companies want to attract.

Although, the actual act of you having an accident may change your premium as well.

 

[Uncle Fester]

Thanks.

I suppose the only way of finding out the effect on my insurance premium is to get a few quotes!

 

[JonathanRyan]

Some questions come to mind. Would my vehicle still be insurable?

Yes.

If it is, would the premium be higher, and if so; by how much?

Possibly - but as others have said it may rise anyway. At the least you may find it needs to be referred to underwriting as opposed to a straight web quote. As you say, worth phoning for quotes.

If I were to claim on my insurance in future; would any payment be restricted due to the fact that the insurance company have deemed the vehicle category C and that they already ‘paid out’ on this vehicle?

Kind of. Maybe. Your vehicle has a value at the moment before impact. That is affected by make/model/age/how you've looked after it etc etc. A valuer may rule that the value is lower because it has already been declared a write off.

If any future insurance claims were restricted in any way; is there any point in having Fully Comprehensive cover instead of Third Party Fire and Theft?

Maybe. Depends on the insurer. Some don't for example allow glass claims on TFFT. There may be other slight differences that may or may not be important to you but generally, no. Unless fully comp is cheaper (and sometimes it is according to that nice Martin Lewis)

Are there any other consequences of owning a category C vehicle that I should be aware of?

You may need to get a new MOT before anybody will insure it - check with your insurers. If it's mechanically sound this is a matter of some admin and a few quid.

 

[Alastair]

I'm actually quite happy with the insurance company offers. The vehicle cost me £1500 a year ago. Their offer to write off the car would mean they would pay me £1325. The offer for me to keep the car as a category C car would mean me getting a payment of £1000.

Here's a Plan B option..

Get a valuation on the vehicle with the damage and as a Cat C from one of the problem car buyers and consider what they'd pay you on top of the insurance Cat C offer of a grand. I'd be very surprised if you didn't end up quids in going that way. Try:

• www.sellyourproblemcar.com and
• scrapcarcentral.co.uk (there are others)

 

[Nod]

The vehicle cost me £1500 a year ago. Their offer to write off the car would mean they would pay me £1325.

£175 for a year's rent of a car is somewhere between sod and b****r all! I'd bite their hand off if I was you.

 

[B1ts]

£175 for a year's rent of a car is somewhere between sod and b****r all! I'd bite their hand off if I was you.

This.
Can't see the point in stressing over that amount, if the premium is too much later replace the car, it surely owes you nothing by then anyway...

 

[Uncle Fester]

Yes.



Possibly - but as others have said it may rise anyway. At the least you may find it needs to be referred to underwriting as opposed to a straight web quote. As you say, worth phoning for quotes.



Kind of. Maybe. Your vehicle has a value at the moment before impact. That is affected by make/model/age/how you've looked after it etc etc. A valuer may rule that the value is lower because it has already been declared a write off.



Maybe. Depends on the insurer. Some don't for example allow glass claims on TFFT. There may be other slight differences that may or may not be important to you but generally, no. Unless fully comp is cheaper (and sometimes it is according to that nice Martin Lewis)



You may need to get a new MOT before anybody will insure it - check with your insurers. If it's mechanically sound this is a matter of some admin and a few quid.

Thank you for your post; it's very helpful.

 

[Uncle Fester]

Here's a Plan B option..

Get a valuation on the vehicle with the damage and as a Cat C from one of the problem car buyers and consider what they'd pay you on top of the insurance Cat C offer of a grand. I'd be very surprised if you didn't end up quids in going that way. Try:

• www.sellyourproblemcar.com and
• scrapcarcentral.co.uk (there are others)

Thanks; I didn't know such car buyers existed!

I don't plan to get rid of the car unless future insurance cover is ridiculously expensive. If that happens; I know where to look to move the car on.

 

[Alastair]

Thanks; I didn't know such car buyers existed!

Neither did I until my previous car expired! I used sellyourproblemcar which turned out to be a local business and was pleasantly surprised with their offer, took a little of the sting out of the replacement. You'll get a quote from these type of buyers within about an hour, and it's no obligation and they don't need to see the car (I think they assume the worst).

 

[Uncle Fester]

£175 for a year's rent of a car is somewhere between sod and b****r all! I'd bite their hand off if I was you.

This.
Can't see the point in stressing over that amount, if the premium is too much later replace the car, it surely owes you nothing by then anyway...

I realise I can accept the insurance company offer and not lose out. My concern is that if I do buy another car; I'm buying an unknown quantity which may require money spent to sort out mechanical problems. The car I have is mechanically sound and I'd rather hang on it than risk buying a lemon.

Of course; if my insurers were to say; double my premiums because the car is Cat C it wouldn't be worth keeping.

Anyhow, after speaking to my insurance company, I have been told that they will not load my premium because the vehicle is category C. I may pay more due to my current claim, but of course, the increase would apply regardless of what vehicle I would be insuring. So accepting the insurance company offer of £1K and keeping the vehicle is a no brainer.

Thanks everyone for your input.