When is a car considered written off?

What does it mean when a car is written off?

A written-off car (sometimes called a total loss) means:

• It may be uneconomical to repair, i.e., the repair cost is high relative to the car’s retail value.
• The damage is so severe that the car is no longer roadworthy (unsafe to drive).

When you claim, your insurer will appoint an assessor to check repair costs. If the repair cost is high relative to the car’s retail value, it might be uneconomical to repair. Major accidents, floods, fires, and theft recovery are common reasons cars are written off.

What will my insurer look at before writing off my car?

Insurers compare the repair cost to the retail value of your car in South Africa. If repair costs exceed 50–75% of the value, the car is usually written off. Factors include:

• Severity of damage – structural damage or safety concerns mean higher repair costs.
• Age of the car – older cars with lower values are more likely to be written off.
• Availability of parts – imported or luxury vehicles can be expensive and slow to repair.
• Condition before the accident – cars with wear and tear are worth less, making them more likely to be declared a total loss.

What happens when my car is written off?

If your car is declared a total loss:

• You’ll get a payout. Depending on your policy, your insurer will pay out the retail or market value of the car (minus your excess).
• The wreck is salvaged. The insurer takes ownership of your car and sells it at auction or for scrap.
• Loan repayments are settled. If you financed the car, the payout goes to the bank first. If the payout doesn’t cover the loan (including a balloon payment), you must pay the shortfall, unless you have shortfall cover. If the payout is more than your outstanding loan amount, the balance will be paid out to you.

Can I keep or buy back my car after it’s written off?

Yes, in some cases you can buy back a written-off car. Not all insurers allow it, and your bank must agree if you still owe money. If allowed:

• Your insurer will deduct the salvage value from your payout. This is the amount that they would receive for your car at auction.
• You’ll take responsibility for repairs, roadworthy tests, and re-registration.
• The car may carry a salvage title, which affects resale and future insurance.

Risks of buying back a written-off car

Buying back a written-off car comes with risks:

• The car may never be fully safe, even after repairs.
• Hidden damage could show up later.
• Some insurers won’t cover previously written-off cars, or they’ll charge higher premiums.
• Resale value is low, and financing is difficult for salvage vehicles.

What do Code 2, Code 3, and Code 4 cars mean in South Africa?

Understanding write-off codes helps you know what happens to your car:

Code 2: A used vehicle that may have accident damage but can still be repaired. It remains a “used car” on the registration papers.

Code 3: A vehicle that has suffered severe structural damage. It can be repaired but must be rebuilt and re-registered as a “Rebuild”.

Code 3A: A vehicle that’s beyond repair. It cannot be driven again and is stripped for parts only.

Code 4: A completely destroyed vehicle, often due to fire. It must be scrapped.

Example: “What is a Code 2 car?” – It’s a used vehicle that may have accident damage but can still be repaired and registered as normal.

Do you pay an excess if your car is written off?

Yes, in almost all cases, you must pay your excess. The insurer deducts this agreed amount from your payout.

FAQs about car write-offs in South Africa

Can I insure a car after it has been written off?

It depends. Some insurers won’t cover rebuilt Code 3 cars, while others may do so with strict conditions and higher premiums.

Are written-off cars for sale in South Africa safe to buy?

They’re often sold at auction. Always check the code, get a roadworthy certificate, and have a mechanic inspect it.

What’s the difference between retail value and market value?

Retail value = dealer selling price (higher). Market value = private sale price. Retail value payouts are better when your car is written off.

What if I still owe a balloon payment on my car when it’s written off?

If your payout doesn’t cover the balloon, you’ll need to pay in the difference unless you have shortfall insurance.

Knowing what it means when a car is written off in South Africa helps you manage the process with confidence. Whether you keep the car, accept the payout, or even consider buying a written-off vehicle, understanding write-off codes and insurer rules will protect your finances.

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