Allianz Announces Responsible Salvage Handling

Allianz Insurance has changed its approach to categorising salvage vehicles to help improve road safety in the UK.

The move has been prompted by concerns that other arrangements risked allowing written-off vehicles to be repaired and sold to new owners. There was also a risk that the new owner might not realise the vehicle had been written off.

To address these concerns, Allianz now categorises all total loss salvage that has suffered impact, flood, fire, or safety related damage as A, B, C or D using the ABI Salvage Code of Practice and the Engineering Technical Committee (ETC) guidelines.*

The inspecting engineer will now also consider the phrase ‘Can, Could, Would and Should’ the salvage be repaired. If it is considered irreparable, it will be categorised as ‘B’, broken and removed from the public domain.

All total loss vehicles will be fully estimated using original equipment parts and full bodyshop labour rates, and all salvage categorisation will be agreed with Allianz’s salvage partner Car Transplants Ltd. In order to enhance the inspecting, estimating and categorisation process, Allianz will now also have engineers permanently stationed onsite at Car Transplants Ltd.

The Motor Insurers Anti-Theft and Fraud Register will be notified of salvage within 48 hours following the engineer’s inspection and categorisation.

All category A and B salvage will be broken in-house by Car Transplants Ltd, and a Certificate or Notification of Destruction (COD or NOD) will be issued to DVLA within seven days following bodyshell destruction. These measures will minimise the risk of written-off vehicles returning to the road and create an audit trail improving the process of checks on second-hand vehicles.

Ian Guest, claims supply manager, Allianz Insurance, said: “While the previous arrangements were entirely legal, as a responsible insurer we have a moral duty to safeguard the public.”

He added: “Hopefully this will create a better way of working and other insurers will follow our lead. It’s a simple matter of doing the right thing.”

* Allianz will not be using the section that applies to ‘unrecorded salvage’.

Click Here for the full Press Release

Changes to Vehicle Tax

You’ll already know that from 1 October 2014, the paper tax disc will no longer be issued or need to be displayed on a vehicle windscreen.

But did you realise that from the same date, when you buy a vehicle, the vehicle tax will no longer be transferred with the vehicle?  The new owner will need to tax the vehicle themselves before they can use it.  They will be able to tax the vehicle using the New Keeper Supplement (V5C/2) part of the vehicle registration certificate (V5C) at the Post Office, online or by phone.

If a taxed vehicle is sold after 1 October and DVLA is notified in the normal way, the seller will automatically get a refund for any full calendar months left on the vehicle tax.

At this stage we understand that those members that have been reclaiming tax remaining on ELVs entering their premises will now no longer be able to do so.

Engine/Gearbox Export with a difference

BBR Procurement Ltd (BBRP) is offering members an engine-gearbox export service, but with a difference.  A number of members are already using the service.  BBRP is being run by a couple of gents that will already be familiar to many of you – Mike Rivers, ex-Ford & CTB, and Mike Booth, ex-CTB.

BBRP provide access to a website which uses ‘number plate recognition’ to identify which engines-gearboxes are required by their clients, and generates a quote for the units.  These quotes are valid for 30 days.  Currently, we understand that there are abut 600 lines required, with more being added continuously.

The emphasis is on exporting good reusable engines-gearboxes, not scrap, possibly those which members have in over-supply (e.g. certain Ford Ka engines).  So clearly, the units must start & run, and not have holes in the sumps or blocks.  Units are expected to be supplied as engine + gearbox with ancillaries (e.g. starters, alternators etc.) attached.

This offers a second or third level outlet to members, at prices better than scrap.  But it also aims to cut out all the ‘messing about’ often associated with exporting.  Once a quote has been accepted, it will be honoured for 30 days.  The supplier needs to deliver the depolluted units to the BBRP premises in Guildford, but this can be done in bulk.

There is a small monthly cost attached to the use of the website, but this depends upon the level of use by the member.

Any member interested should contact BBRP for further details

BBR Procurment Ltd.

www.bbrproc.co.uk

(01992) 568 208

Mike Rivers 07713 515 370

Mike Booth 07789 911 883

VIC - Other Government Considerations

The DfT recently wrote to MVDA in relation to the proposal to scrap the VIC scheme.  The edited extracts below indicate the thoughts of Government, particularly those areas where there are outstanding concerns and further work is required.  You will recognise many of the concerns outlined over the years by MVDA and its members.

The consultation in 2012 on the future of the VIC scheme and subsequent discussions identified major concerns with the current VIC scheme.  This reinforces consultation responses which appear to support the abolition or at the very least a radical alteration of how the scheme works.  The main issue highlighted by respondents was around roadworthiness, for which the VIC scheme was never intended to be used.  This perception of the VIC being a roadworthiness check means that we have a re-educating role to play in informing the public how roadworthiness issues should be dealt with.

The review of the VIC scheme also identified issues of consumer protection and the state of some accident damaged repaired vehicles.  Publicity following two accidents involving previously written-off vehicles has raised again concerns with the quality of some accident repaired damaged vehicles. DfT would like to discuss further with key stakeholders, including the Association of British Insurers, about how this issue can be addressed and to formulate options on taking it forward.

DfT would like to give consideration to whether the insurance industry (ABI) Code of Practice (on disposal of Motor Salvage) should be given a statutory footing, enabling more control on how repairs are carried out and the categorisation of vehicles after they have been in an accident.  The following points need particular consideration:

1. If the insurance industry has categorised a vehicle as either A and B should it ever be repaired?
2. Should it be an offence to return category A or B vehicles back to the road unless they have gone through an enhanced MOT/exceptional procedure?
3. How can we stop the few category A and B accident damaged vehicles from going back on the road when there is currently nothing legally to prevent them from doing so?
4. Do we want to license technicians/ body shops/ garages, accrediting them to undertake repairs on some types of accident damaged vehicles?
5. With the abolition of the VIC scheme there will no longer be a VIC marker flagging the vehicle as having been in an accident.  So going forward should the insurance industry be sending V5C for category C written-off vehicles to the DVLA for marking that it has sustained ‘serious damage’
6. Should we continue to use the literal wording of ‘seriously damaged’ on the re-registration document, or use different wording depending on the damage sustained?
7. How can we ensure that the buyer of a used vehicle knows the vehicle has been written-off and repaired, and that it has been done so to an approved standard?
8. Where an accident damaged vehicle has been written-off should it then undergo a MOT, irrelevant to when the vehicle last went through one?
9. Should all or some categories of written-off vehicles be inspected before going back on the road, or a sample of them depending on the nature of the damage, and who should be undertaking these inspections?  If this is implemented it may require an extra level of MOT testers and VVRA body shops with an additional layer of competence and skill to be able to identify issues on repairs where they can.
10. Should crash damaged vans and motorcycles be brought in scope of the ABI COP?
11. We would also like to explore the supposed mis-categorisation of vehicles and the alleged misuse of category D.

 The views of members on any of these points are welcome.

VIC Scheme Abolition FAQ's

1. WHY HAS THE DECISION TO ABOLISH VIC BEEN TAKEN?

At the time of its inception VIC was aimed at deterring the crime of replacing the identity of a stolen car with that of a cheaply bought total loss (write off) car of the same type.  This is commonly known as ‘ringing’.  Insurance companies operate within a Code of Practice for categorising write-offs.  The VIC scheme applied to all written off cars in salvage categories A, B or C.  Experience has shown that this has placed a burden on a large number of owners who have opted to retain the salvage (i.e. the car) because relatively minor damage can result in repairs costing more than the value of the vehicle.  For many motorists, it has become an unnecessary procedure, particularly when a vehicle has remained in the hands of the same keeper for several years and the market value is low.

2. WHY HAS THE SCHEME NOT BEEN SUCCESSFUL?

Since the start of the scheme in April 2003 less than 40 so-called ‘ringers’ have been detected from around 916,000 checks completed over the 11 years to 2013.  Data provided from the British Crime Survey has demonstrated that vehicle theft continues to fall and has been doing so since the 1990’s, prior to the VIC scheme being introduced.  The deterrent effect of the VIC scheme is difficult to quantify due to the way the police record vehicle crime related offences. Additionally vehicle technology and the processes adopted by police forces to track down organised vehicle crime are far better than they were at the inception of the VIC scheme.  About 75% of the checks were undertaken on cars which were 7 years or older, written-off because the cost of even small repairs were greater than the very low market value of the vehicle, often meaning that the cost of the check fell on the less well-off members of society.

3. WHAT WAS THE PURPOSE OF VIC WHEN IT STARTED?

The VIC scheme was introduced in April 2003 with the purpose of deterring the crime of vehicle ringing.  Typically this involved the theft of a car of significant value, which is then given the identity of a similar car (make, model, colour etc) which has been the subject of an insurance write-off.  The written-off car is obtained cheaply; it identity (Vehicle Identity Number (VIN) and Vehicle Registration Mark (VRM)) is then transferred to a higher value stolen car which, now apparently genuine, can be sold at market price.  This is known as vehicle ‘ringing’.  The check was designed to prevent vehicle ‘ringing’ by confirming that the car presented for check is legitimate.

4. HOW DID THE CHECK REDUCE CRIME?

When a car is written off or declared scrapped due to substantial damage to bodywork the V5C registration certificate is surrendered to the insurance company.  If the car is repaired with the intention of putting it back on the road, DVLA will not issue a new V5C logbook until the car passes a VIC.  If the identity of the car is in doubt it will fail the check.  This meant that DVLA will not issue a new V5C logbook or vehicle tax disc for the vehicle.

5. HOW CAN I TELL IF A VIC IS REQUIRED?

A VIC is required for all cars notified to the Driver Vehicle Licensing Agency (DVLA) as written off (category A, B or C) and returning to the road.   Since 7^th April 2003 DVLA have kept a record of all cars that require a VIC check. . You can contact the DVLA for advice on whether the car requires a VIC test (you can also check on-line)

6. HOW ARE VEHICLE IDENTITY CHECKS MADE AND WHO DOES THEM?

VICs are undertaken by the Driver Vehicle Standards Agency (DVSA) in Great Britain and by The Driver and Vehicle Agency (DVA) in Northern Ireland on behalf of the DfT.  The check will compare the car presented against information held by DVLA such as the chassis number, make, model, and colour and engine number.  Other components may also be checked to confirm the age and identity of the car.  The inspection will also compare the record of previous accident damage with evidence of the repair.

7. WHAT ARE WE GOING TO REPLACE VIC WITH?

The vehicle crime element is now largely dealt with by modern vehicle technology that has improved vehicle security over the 10 years since the inception of the VIC scheme.  This is demonstrated by the very low number of vehicles that have been discovered to be rung. Various options to modify the scheme were explored but no viable filters could be put in place without over complicating matters and imposing greater burdens on some customers.  The Department has committed to investigating further with the Home Office and industry what, if anything, will replace VIC.

8. IS THERE ANY OTHER WORK YOU ARE DOING CONNECTED WITH WRITTEN-OFF VEHICLES?

We have contacted a number of stakeholders to consider a number of issues further with them before the October 2015 abolition of VIC.  These issues include:

• considering a statutory basis for the insurance industry’s code of practice about written-off vehicles;
• information for purchasers/ consumers related to previously written-off vehicles;
• vehicle registration documentation; and
• considering measures related to very severely damaged vehicles (including category Bs)

9. WHERE DOES THE VIC SCHEME APPLY?

It is currently in operation across the United Kingdom, with checks done in Great Britain by the Driver and Vehicle Standards Agency and Northern Ireland by the Driver and Vehicle Agency.   We want to ensure a Northern Ireland perspective is included in the issues for further consideration

10. HOW WILL WE PREVENT VEHICLE RINGING IN THE FUTURE?

Since 2003 it has not been demonstrated that the scheme has not done what it set out to do.  The Department will work closely with its stakeholders to establish if anything is required in the future.

11. WHAT HAPPENS TO CARS THAT ALREADY HAVE A VIC MARKER?

The Department will be considering further with DVLA and industry how VIC markers will be treated during the period up to abolition.  The current position is that cars with a VIC marker will continue to require a VIC to remove the marker until October 2015.

12. WHAT WILL HAPPEN TO OUTSTANDING VIC FAILURES WHEN VIC IS ABOLISHED?

Any vehicles that have a VIC inspection and fail it before the abolition will be treated as they are now.  A registration certificate will not be issued until it can be demonstrated that the car is not a rung vehicle.  The process already in place will continue until the scheme is abolished.  The Department will be considering this further with stakeholders during the period up to abolition.

13. WILL VIC MARKERS STOP BEING ADDED PRIOR TO ABOLITION?

The Department will be considering this with stakeholders during the period up to abolition.

14. HOW SOON BEFORE VIC CEASES WILL DVSA STOP TAKING APPLICATIONS?

The Department will be considering this with DVSA and industry during the period up to abolition.

15. HOW WILL I KNOW THAT MY WRITTEN-OFF VEHICLE IS ROADWORTHY FOLLOWING REPAIRS WHEN VIC IS ABOLISHED?

It was perceived that the VIC scheme was to do with roadworthiness.  The scheme was never intended, or ever has been, used as a means to determine roadworthiness. During the Department’s consultation concerns were expressed that the roadworthiness and crashworthiness of rebuilt written-off vehicles should be subject to checking.  The Department is committed to investigating this further with industry. 

16. WILL ABOLISHING VIC MAKE IT EASIER TO GET WRITTEN-OFF VEHICLES BACK ON THE ROAD?

Yes, this will avoid waiting for an appointment for the VIC inspection to be undertaken, which can have a lead time of up to 6 weeks.  However, the Department will be considering further the processes for ensuring that the car has been repaired and is roadworthy prior to the issuing of the V5C.

Scrapping the VIC scheme - what happens now?

You will already know that on Monday 9^th June DfT announced that the VIC scheme was being abolished from October 2015.  This was MVDAs view in response to the 2012 VIC consultation.

However, DfT also made it clear that there were a number of other problems that had been brought to their attention during the 2012 consultation process.  They were aiming to start to address these issues immediately, so that measures could be put in place before VIC was abolished.

It is not yet clear how the VIC scheme will be phased out & any new arrangements put in place.  But MVDA has been invited by DfT to form part of a small working group to look at these problems, and their potential solutions.  The first meeting will be taking place very shortly, so the Government means to press ahead rapidly.

DfT has provided a set of VIC FAQs and we will forward these to you in a separatee-mail and also post it on the MVDA website shortly.

I will also explain some of the other issues of concern and their implications for members

In the coming weeks and months please do let us have your views on the various aspects being discussed.

These are all very important issues for members, so we will continue to keep you regularly updated.

Thank you to the CARS 2014 ‘Behind the Scenes Team'

With CARS2014 now over & thoughts turning to CARS2016 (particularly a potential location in the South of England), a quick word of thanks to some of the key people that helped organize the event, on voluntary (unpaid) basis:

•  Chris Floate, Editor of the MVDA magazine and ATF-Professional
• Terry Charlton, long-term member of the MVDA, and past MVDA Chairman
• Andy Latham, MD of Salvage Wire Consultancy (ex. Bluecycle)

And of course to:

•  Richard Martin, MD of Motorhog, who hosted the show at his fabulous site near Doncaster.

We will shortly be updating the MVDA website (members section) with images from the 2014 show