Transfer of ownership for a car written off by insurance.

[_patch]

Hi,

My girlfriend recently crashed her car. Her insurance has written off the car claiming that the damage was more than 40% the value of the car and it was not economical to fix. She has spent the last week trying to sort things out between her bank and her insurance. Trying to deal with transfer of ownership has brought up a lot of questions.

If the car has been written off and deemed uneconomical to repair:

What does the insurance company do with the car?

Insurance now owns the car. If the car’s license disc was expired, who does the responsibility of paying the outstanding balance fall on?

I feel as though 40% the value of the car is quite a low threshold for seeming a car or repairable. Is there a law that regulates this?

It seems very likely that the insurance company is planning to sell the car to someone who will fix it and sell or that they are going to do that themselves. Is that legal if they have written the car off? Shouldn‘t they be scrapping it?

Can we have the car re-evaluated? There estimate seemed excessive. The airbags didn’t even go off.

We would love some help.

 

[SauRoNZA]

I’m amazed they are paying out so easily with the disc having been expired.

All cars that are scrapped get auctioned off and some person will buy it and repair it or use the parts.

Pretty standard but the insurance definitely doesn’t do it themselves and just try to recoup some costs.

You can fight the insurance on this but generally at those kinds of values it’s not a car you or anyone else wants to drive after a repair so rather just get a new one and be better off for it.

The transfer of ownership and all that shouldn’t be anything you even need to deal with, bank and insurance will sort it out for you amongst themselves.

 

[TheChamp]

Why are you concerned about what the insurance is going to do with the car? And what is the problem with the expired license? Was it expired at the time of the accident?

Are you not happy with the settlement? I don't think you would have any luck with reevaluating the car, the insurance/panelbeater thing is a cabal, you are not going to win, unless it is evaluated by some unregistered panelbeater who can fix it cheaply with no recourse if something goes wrong.

I have heard of people buying their wrecks from insurance companies, perhaps ask about it if you are that interested.

 

[_patch]

Thanks for the responses!

The car was a year overdue a new license and the insurance company wants us to renew it. It’s just an annoyance that we don’t want to go through and don’t really understand why we would need to if the car 1. is no longer ours and 2. is supposedly written off. I think we’re also just a bit destraught after having lost a perfectly good car in a matter of seconds. The car didn’t look bad at all after the accident nor were the airbags deployed yet the damage was more than R70000 and we feel a bit lied to. At least, insurance has covered most of it but It would still be nice not to have to go through it all.

 

[Swa]

First off it's pretty standard practice yes. They are hoping to get more out of it than the value of the car minus what they should be paying for the damage. Secondly the car doesn't belong to the insurance until it's signed over and the registration handed in. Unless it's still being paid off and not really yours.

This usually happens when the damage isn't really that severe. You could ask them to pay you out a lower amount and have it fixed for cheaper or do it yourself.

 

[SauRoNZA]

Thanks for the responses!

The car was a year overdue a new license and the insurance company wants us to renew it. It’s just an annoyance that we don’t want to go through and don’t really understand why we would need to if the car 1. is no longer ours and 2. is supposedly written off. I think we’re also just a bit destraught after having lost a perfectly good car in a matter of seconds. The car didn’t look bad at all after the accident nor were the airbags deployed yet the damage was more than R70000 and we feel a bit lied to. At least, insurance has covered most of it but It would still be nice not to have to go through it all.

Airbags means nothing.

Likely the chassis has been damaged and that is where the real cost comes in.

 

[thehuman]

Scrap car will go on auction, but you could ask insurance if you can buy it back tho . License can't be transferred without it being renewed.

I don't understand why people stop paying license as soon as they can't use vehicles. ( lets say you want to sell the engine, car need to be scrapped, to do this license need to be up to date. )

 

[Hemi300c]

1. Get and work through a reputable broker
2. Don't go by the advice or statements made on this forum by unauthorised or unapproved persons only take advice from a Financial Services Provider
3. An insurer, if decent, wl only settle a claim once your disc or drivers licence is up to date.
4. Most insurers, not all, will settle the claim and allow you to buy the vehicle back if you offer more than their std salvage contractor like SMD. Sometimes they are bound by Contract and cannot.
If you haven't signed an AOL (agreement of loss) you can still maybe negotiate a settlement where you can buy the vehicle.
If they wrote off the vehicle for 40% damage it's because critical structural damage is evident or they forsee come backs after repairing.

 

[Swa]

Scrap car will go on auction, but you could ask insurance if you can buy it back tho . License can't be transferred without it being renewed.

I don't understand why people stop paying license as soon as they can't use vehicles. ( lets say you want to sell the engine, car need to be scrapped, to do this license need to be up to date. )

Selling engine you need a police affidavit. Also quite easy to transfer ownership for little more than the price of the license. No questions asked you just need the registration papers. Really not worth it to keep renewing license for years.

 

[calypso]

If the license is a year overdue, the car is technically not roadworthy and the insurance company doesn't have to pay a cent. I would pay for the license and say thank you.

 

[chrisc]

I had the same scenario in 2012

The wreck was purchased by a scrapyard who disassembled the car and sold the used spares. I happened to know the owner and he said he paid a nominal R9000 to the ins co. He reckoned that he would recover the money plus make a good profit within 6 months. For instance he sold the wheels and tyres for R1200 each. The windscreen goes for R2000, on and on

I do know a body shop owner who bought two wrecks of the same model car, cut them apart and rejoined them. It worked ok, but now the car is registered as a rebuild and has 1/3 of the value

 

[Neuk_]

That sounds like the normal process for a car written off by insurance but 40% of replacement value is the lowest I have heard of, unless there is another reason for the write off? You can object and see what your underwriter offers as an alternative, some underwriters will even sell the car back to you after writing it off but not many go for this option.

If the license is a year overdue, the car is technically not roadworthy and the insurance company doesn't have to pay a cent. I would pay for the license and say thank you.

Do underwriters really try this? An expired licence or renewing a licence has zero to do with a cars road worthiness.

 

[Hemi300c]

If the license is a year overdue, the car is technically not roadworthy and the insurance company doesn't have to pay a cent. I would pay for the license and say thank you.

That sounds like the normal process for a car written off by insurance but 40% of replacement value is the lowest I have heard of, unless there is another reason for the write off? You can object and see what your underwriter offers as an alternative, some underwriters will even sell the car back to you after writing it off but not many go for this option.



Do underwriters really try this? An expired licence or renewing a licence has zero to do wit ha cars road worthiness.

Nope refer to my post #8

 

[calypso]

I was told this by the assessor who was busy checking my tire depth for my car that was bumped while parked.
True or not, is it worth the fuss and potential hassle? Rather pay your license.

 

[Neuk_]

I was told this by the assessor who was busy checking my tire depth for my car that was bumped while parked.
True or not, is it worth the fuss and potential hassle? Rather pay your license.

If the assessor claimed that the vehicle was not allowed on the road since it's licence had expired, I would understand, but an expired licence doesn't prove unroadworthiness, from a technical viewpoint anyway.

 

[geezer]

If the license is a year overdue, the car is technically not roadworthy and the insurance company doesn't have to pay a cent. I would pay for the license and say thank you.

To make it clear, I am not a legal expert, but I did a quick Google search, and came upon this ruling given by the Supreme Court of appeal: http://www.justice.gov.za/sca/judgments/sca_2019/sca2019-025.pdf

It involves a case where a driver of a bakkie killed a person on a bicycle. He swerved out for the cyclist, but the trailer attached to the bakkie struck and killed the cyclist. He was arrested by the police officer that went out to the scene of the accident, for "Culpable homicide" and for driving an "unroadworthy" vehicle because the vehicle's licence disk has expired. The driver then sued the Minister of Police for unlawful arrest and he won the case. In the ruling the judge also made this statemen: "I may add that a vehicle is not rendered unroadworthy by virtue of its licence disc having expired." This was also taken into consideration when passing judgement.

Google also came up with a number of references that supports this.

 

[Swa]

If the license is a year overdue, the car is technically not roadworthy and the insurance company doesn't have to pay a cent. I would pay for the license and say thank you.

License is just a tax and does not determine roadworthiness. Even the registration of a vehicle is just an administrative matter and does not mean a vehicle is roadworthy. The insurer will conduct a separate assessment on whether or not a vehicle is roadworthy.

 

[Hemi300c]

I was told this by the assessor who was busy checking my tire depth for my car that was bumped while parked.
True or not, is it worth the fuss and potential hassle? Rather pay your license.

Dude get a broker and an assessor is not a FSP expecially motor ASSessors

Also the tyre's would have no bearing or direct cause on the loss if the vehicle was parked.

 

[calypso]

Dude get a broker and an assessor is not a FSP expecially motor ASSessors

Also the tyre's would have no bearing or direct cause on the loss if the vehicle was parked.

I was just using this as an example. Happened years ago and was no issue at the tires were fine. Insurance companies can just be assholes, especially when its time to claim, so best not leave them anything to jump on.