In Australia, a write-off is any vehicle that has been deemed uneconomical to repair by an insurer or assessor.
While this can be due to a range of factors including wear and tear or just old age, most of the time it is from damage caused by car accidents or natural disasters such as flooding.
In this article, we will explore everything your need to know about car write-offs including the amount of damage that the vehicle needs to be written off and the types of write-offs that can occur.
By understanding this vehicle classification more clearly, you can better prepare yourself if your vehicle is declared a total loss.
What Does A Car Write-Off Actually Mean
A car write-off, otherwise known as a total loss, is when an insurance assessor deems a vehicle as too severely damaged to repair.
This usually happens when the cost of repairs exceeds a certain percentage of the vehicle’s value. It can also occur if there are safety concerns such as corrosion or age that make the vehicle not suitable for repair.
How Much Damage Does A Vehicle Need To Be Written Off In Australia?
The amount of damage needed to write off a car in Australia depends on the type of write-off that is being considered as detailed below.
In any case, the degree of damage can range from minor to severe, and based on this the vehicle may be classified as a statutory write-off or repairable write-off.
Statutory Write-Offs
A statutory write-off is when the damage to a vehicle is severe enough that it cannot be legally driven on public roads. Also, depending on your insurer, the cost of repairs may exceed either 75% of the market value of the car or $10,000 – whichever is lower.
Repairable Write-Offs
A repairable write-off is when the damage to a vehicle can be repaired but it would still exceed a certain percentage of the vehicle’s market value. Some insurers may set this as either 50% of the market value or $5,000 – whichever is lower.
In some cases, a repairable write-off may still be able to be driven on public roads if the repairs are carried out correctly and the car meets all safety regulations.
Types Of Damage That Can Lead to A Total Loss Declaration
The types of damage that can lead to a vehicle being written off vary, but usually include:
- Major collision or rollover damage
- A blown engine or failure of other expensive parts
- Fire damage
- Flooding or severe water damage
- Corrosion or rust
- Loss or theft
What Happens After Your Vehicle Is Written-Off
When your insurance company write-off your vehicle it is added to the Written-Off Vehicle Register (WOVR) and you usually receive a cash payout. Alternatively, you may receive a new-for-old replacement vehicle. This will be determined by your specific insurance policy.
If you receive a payout, the amount is normally the market value or insured value of the car.
Can You Sell A Write-Off
Yes, you can sell a write-off in Australia but it is important to be aware that any written-off vehicle will have a diminished resale value and therefore should only be sold as scrap or for parts.
It is also important to ensure that all safety checks are completed on the vehicle before it is resold. This includes checking for any potential defects or discrepancies that may not have been picked up during the initial assessment.
Finally, the sale of a write-off vehicle must still be reported to the relevant state authority and all necessary paperwork completed before the transaction can proceed.
Should You Buy A Write-Off
Buying a write-off can be risky as there is no guarantee that the vehicle has been repaired correctly or is safe to drive on public roads.
If you are considering buying one anyway, it is important to ensure that all safety checks are carried out before the purchase is made. This includes getting an independent assessment of the car’s condition from a qualified mechanic.
It is also important to keep in mind that the resale value of a write-off car will be much lower than an equivalent used car in good condition. Therefore it is important to ensure that you are getting a good deal before making the purchase.
What Payout Will You Receive
In most cases, if your car is written off you will get a payout from your insurance company. This payout amount depends on the type of write-off and the agreed value that was set as part of your insurance policy.
For example, if your car is a statutory write-off then you may be entitled to a payout that covers the agreed value of your car less any excess that is applicable.
It is important to remember that the payout from your insurance company will only cover the value of your car and not any additional costs such as towing or storage fees.
Summary
Writing off a car in Australia is an unfortunate event that can happen when your vehicle has been damaged beyond repair. It can be a stressful and time-consuming process as you have to deal with insurance companies and the potential of having to purchase another car.
Be sure to thoroughly read through your policy and contact your insurer to understand exactly what constitutes a write-off according to them and what will happen next. With this information, drivers can make informed decisions about their damaged cars and move forward accordingly.
