Maybe you’ve just walked outside after an unexpected afternoon hailstorm to discover your car’s exterior looks as dented as the surface of a golf ball. Or perhaps you’re standing on the side of the road after a car accident, staring at deployed airbags or twisted metal, just thankful everyone is okay.
Either way, you lodge a car insurance claim and wait to be told how long it’ll take to have the damage fixed – only to find out from your insurer a few days later that they’ve decided to write the car off rather than repair it.
It’s an outcome that can trigger a flood of questions, particularly if your car looks – at least from the outside – like it’s still got some life in it. So how do insurers decide when to write off a car? Can you dispute the decision? What type of car insurance covers your car if it is a total loss? And how is a claim settled after a car insurance write-off? We’ve put this guide together to answer all of those questions, and more, starting with explaining what a write-off actually is.
What is a write-off?
A write-off is a vehicle that’s been damaged to such an extent that it’s either not safe or not economical to repair.1
There are two different types of write-offs:2
- A statutory write-off: Also known as unrepairable write-offs, these are vehicles that have sustained significant damage, such as excessive structural, fire or water damage, and are unsafe to repair.
- A repairable write-off: These are vehicles that are technically safe to repair, but doing so would likely cost more than the car’s insured value, once salvage value is considered, making it economically unviable for an insurer to repair.2
Once a car has been declared as either type of write-off – also known as a total loss in insurance terms – it has to be recorded on the Written-Off Vehicle Register (WOVR).2 We’ll go into this in more detail later.
How do insurers determine if a car is a write-off?
Once you’ve lodged a car insurance claim, your insurer will assess it – and assess your vehicle to see how extensive the damage is.3,4
As part of this process, insurance companies are legally required to report a car as a statutory write-off if it’s unsafe to repair the vehicle, or as a repairable write-off if it’s uneconomical to fix.2
“At Youi, if you have a Market Value policy, once we’ve assessed the damage and if it’s been established that the car is safe to repair, we then look at a range of factors to work out the Market Value of your car immediately before the incident that led to your claim,” says Marni Jackson, Youi’s Head of Product – Vehicle and Lifestyle.
“Our qualified assessors use industry pricing guides and take into account the make, model, age and condition of the insured vehicle, as well as its mileage. We also consider the vehicle’s salvage value, which is what we can recover by selling it in its damaged condition, to help decide whether or not it’ll be repaired or deemed a repairable write-off.
“Alternatively, if the damage meets the criteria of being unsafe to repair, we’ll declare the car a statutory write-off.”
What constitutes a statutory write-off in your state or territory?
In Australia, the laws in each state or territory, while governed by similar criteria, go into specific details about what makes a car unsafe to repair.2
For example, it might be if your car has been flooded above the lower door sill, if the chassis was bent in a car accident, or if fire damage has blistered paint in a particular section of the car.1,2
You can use the links below to find out more about the particular criteria used to determine whether a car is a statutory write-off where you live:
- Victoria
- New South Wales
- Queensland
- South Australia
- Western Australia
- Australian Capital Territory
- Tasmania
Which type of car insurance covers write-offs?
Car insurance policies that provide cover for your car if it gets damaged may cover vehicle write -offs.5,6
“Generally speaking, it’s only Comprehensive car insurance and Third Party Fire & Theft car insurance policies which cover damage to your car,” says Jackson.
“But whether or not your car will be covered if it’s written off varies between those policies, depending on how it was damaged and what they include as insured events.”
Here’s what’s covered as an insured event at Youi if you have:
- Comprehensive car insurance: This extensive option provides cover for your car if it’s declared a total loss as a result of a range of events including theft, fire, intentional damage, some severe weather events such as storm, hail or a flood, and accidental damage, even if the accident was your fault.6,7
- Third Party Fire & Theft car insurance: This option provides cover for your car if it’s declared a total loss due to theft or fire damage. It doesn’t cover damage or write-offs caused by accidents, weather events or intentional damage.6
Meanwhile, Third Party Property Only insurance covers damage caused by your car to other people’s cars or property but it doesn’t cover any type of damage to your car.6
How are car insurance claims settled if your car’s a total loss?
If your car is written off as a total loss as a result of an event covered by your car insurance, depending on your policy and the age of your vehicle, you’ll typically receive an insurance payout or a replacement car if you have new car replacement cover – and you meet the eligibility criteria.8
“At Youi, if you have Comprehensive or Third Party Fire & Theft car insurance with us and a car which you bought brand new from a dealer is declared a total loss following an insured event within two years of it first being registered, we’ll pay to replace it with a new car,” says Jackson.6
“Otherwise, if your car’s more than two years old and declared a total loss, we’ll pay you the car’s value, based on the cover shown on your policy schedule.”6
How much will the insurance payout be for a write-off?
It depends. “When you take out a car insurance policy, you’ll typically need to choose whether you want cover for the Market Value or Agreed Value of your vehicle and that choice affects how much you’d be paid if your car is written off as a total loss,” explains Jackson.
It works like this:6,9
- If your car’s insured for Market Value: The payout after a total loss is an assessment of what your car would likely sell for immediately before an incident that led to a claim, based on market conditions.
- If your car’s insured for an Agreed Value: The payout after a total loss is a fixed amount you and your insurer decide on when the policy starts, regardless of how the market changes.6,9
When we settle a total loss claim for your car, the premium for the contract period is due and the following deductions will be made from the amount we pay you: applicable excesses, any applicable input tax credit, and any unpaid premium and remaining premium instalments.
“Agreed Value policies can typically cost more than Market Value ones, but they offer some certainty,” says Jackson.
“And knowing how much money you’ll receive if your car is declared a total loss can be helpful, especially if you’re still paying it off.”
FAQs about vehicle insurance write-offs
Now that you know the basics of how a car insurance write-off works, you might have some specific follow-up questions. Here are the answers to some of the most common queries we get asked by drivers.
Can a write-off be repaired, re-registered and re-insured?
Sometimes. While statutory write-offs can’t be repaired and re-registered anywhere in Australia, if it’s a repairable auto write-off, you might be able to get authorisation to repair and register it again.2
The rules around this vary across Australia and some states and territories have much stricter regulations and criteria than others.8 If you’re considering repairing a vehicle that’s been listed as a repairable write-off, you might want to check with your state’s road authority before you spend any money to see if it can be re-registered.2
As for insurance, Jackson says. “You may be able to insure a repairable write-off after it’s been fully repaired, passed rigorous safety inspections and has been re-registered,” she says.
How does the Written-Off Vehicle Register work?
It’s a national register of vehicles in Australia that have been declared either a statutory write-off or a repairable write-off.2,10 It exists to let people know if they’re buying a vehicle that’s been extensively repaired.2
If an insurer assesses a car and determines that it’s a write-off, it must notify the register within seven days of the assessment.2
To find out if a used car you’re considering buying is listed on the register because it’s been declared a write-off at some stage, you can search the Personal Property Securities Register (PPSR) as part of a pre-purchase car history check.11
Can you dispute an insurer’s decision to declare your car a total loss?
Yes. If your car’s been declared a statutory write-off and you disagree with that decision, you’ll usually need to provide expert evidence that the insurer has made a mistake, to prove that the damage doesn’t meet the criteria of a non-repairable write-off.2
If your car’s been declared a repairable write-off and you want to dispute it, you’ll also need evidence, such as like-for-like repair quotes and an estimate of the salvage value – from a salvage yard.12 This evidence would need to show that the cost to repair the car is less than its pre-incident Market Value or its Agreed Value (depending on your cover) once the salvage value is taken into account.2
If you do want to dispute the decision to write off your car, you might want to act fast. Insurers won’t usually change their decision after they’ve notified the Written-Off Vehicle Register that a car’s a total loss, which they must do within 7 days of assessment.2
Can you keep or buy back your vehicle after a car insurance write-off?
At Youi, the vehicle you are claiming for becomes Youi’s legal property if it’s declared a total loss and your claim is settled for the full insured value.6
However, the Financial Rights Legal Centre advises that while an insurer legally gets to keep a vehicle after it’s been written off, it may be possible to negotiate with them to buy it back.2
What if you have a loan on a car that’s a total loss?
As part of a car loan’s terms and conditions, banks and other financiers will typically require you to take out a comprehensive insurance policy to cover the vehicle for the lifespan of the loan.13
“So, if your car is covered for total loss as a result of an insured event with Youi, when we settle your claim, we may first pay any amount still owing to your financier,” says Jackson. “Then, we’ll pay any remaining amount to you.”
Will a write-off affect your car insurance premium?
Possibly. “Your claims history is something that we take into consideration when calculating premiums,” explains Jackson. “So if you’ve made any type of claim in the past 12 months, including one that resulted in your car being declared a total loss, your car insurance premium may increase.”
Car insurance write-off tips
While you can’t predict when a rogue hailstorm or an unlucky bingle might put your car off the road for good, there are steps you can take to help manage how your car insurance might cover the situation. Here are three things you might like to consider doing:
1. Check if your policy includes new car replacement insurance
If you have this cover, and your car was new when you bought it, it may be replaced with a new one if it’s written off after an accident, within a specified period of time after purchase.14
If you don’t have this cover, and your new car is insured for Market Value, the insurance payout you’d receive if the vehicle was written off within the first couple of years could be significantly lower than what it would cost to replace your car with a new one.9
“At Youi, if you have Comprehensive or Third Party Fire & Theft car insurance, New Car Replacement cover automatically applies for the first two years, if you’ve purchased a new car from a dealer,” says Jackson.
2. Decide whether to cover your car for Market Value or Agreed Value
“Choosing between Agreed Value and Market Value really comes down to your car and your budget – and how much certainty you want if you need to claim,” says Jackson.
“An Agreed Value policy may cost a little more, but it offers certainty about what you’ll be paid if your vehicle is written off. On the other hand, a Market Value settlement reflects the car’s value at the time of the incident.”
3. Tell your insurer about modifications to your car
If you haven’t let your insurer know about any modifications you’ve made to your vehicle, whether it’s wider tyres or installing a new and improved audio system, compensation for those modifications may not be included in your insurance payout if your car’s a write-off.15
“At Youi, while personalised plates, towbars and window tinting are automatically covered under our Comprehensive and Third Party Fire & Theft policies, if you’ve decked your car out with other accessories or made modifications for your camping adventures for example, you should let us know,” says Jackson.
“Otherwise, if you need to make a claim, those accessories or modifications probably won’t be covered.”
While a total loss claim may sound stressful, knowing how car insurance write-offs work and how different cover options might affect your insurance payout, can help you navigate the process, should you ever need to.
And, if you’re keen to review or update your car insurance cover after reading this guide, why not consider starting a quote online or by giving us a call on 13 9684.
1 Source: Australian Financial Security Authority – Understanding written-off codes
2 Source: Financial Rights Legal Centre – Written-off Vehicles, August 2025
3 Source: Canstar – How do car insurance claims work?, September 2025
4 Source: Drive – When is a car a write-off? Here are the telltale signs, August 2023
5 Source: Moneysmart – Choosing car insurance
6 Exclusions, limits and additional fees may apply. For full details, see the Car Insurance PDS.
7 Available with Comprehensive policies only. Exclusions and limits may apply. Where you have increased your cover or reduced your excess within 72 hours of a flood, storm, hail or bushfire occurring, cover will be limited to the amount that was effective prior to the change. Loss, damage or legal liability caused by, resulting or arising from flood, storm, hail or bushfire during the first 72 hours of your policy first being purchased is excluded unless certain conditions apply. For full details, see the PDS, TMD and your policy schedule.
8 Source: Canstar – What happens if your car is written off?, April 2025
9 Source: Canstar – Car Insurance Market Value vs Agreed Value, April 2025
10 Source: ACT Government – Written-off vehicles
11 Source: Australian Financial Security Authority – Do a used car vehicle search
12 Source: Australian Financial Complaints Authority – The AFCA Approach to motor vehicle total loss complaints, April 2023
13 Source: Canstar – Is comprehensive car insurance worth it?, May 2025
14 Source: Canstar – New for Old Car Insurance, June 2025
15 Source: Canstar – Car insurance for a modified car, May 2025
