Write Off

If you're involved in an accident and your vehicle sustains damage, the insurer, if it believes it is liable, will pay out. First, however, the insurer will want to satisfy itself that the claim is valid and also that it's paying out the minimum sum it is bound to.

However, if substantial damage is done to a vehicle, a repair may not be economic. There is little point spending £1,000 repairing a vehicle, if it may then not be worth that amount. In such circumstances, the insurer will decide the vehicle is a 'write off' and either provide a replacement or a cash pay out to the policyholder.

Last Updated: June 2006 © Moneyextra.com

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