Team-BHP - Getting rid of a Total Loss Car. Paperwork, Insurance formalities etc.

Roopa Amit drops the following questions via the contact us form:

Quote:

Hello Team,

My Car Maruti Swift VXI 2006 Model, suffered a Total Damage on 12th July 2013 due to our society compound wall collapsing on it due to torrential rains. The surveyor (Bharti Axa General Insurance) has classified it as a case of Total Damage since the cost of repairs is >75% of IDV. The process of inviting bids for sale through salvage is currently open and will close on Friday,2nd August 2013.

As the salvage buyer and I would be directly interacting and the Insurance company would have no role to play in it, I have a few specific question on this and would be highly obliged if you could advise me on the same:

1) What are the documents I should seek/provide when handing over the vehicle to the Salvage buyer? I have been told that some salvage buyers actually refurbish and sell the car. In such case I need to ensure that the Car registration in my name is transferred or cancelled to avoid any liability in future. What is the process I need to follow with the RTO for this?

2) Should I enter into an agreement on a say a Rs 100/- stamp paper and get it notarized while handing over the vehicle stating that I have handed over the vehicle as scrap sale and in future I shall have no liability or no way responsible for the vehicle.

3) Post the salvage sale, how does the Insurance company pay the remaining amount. My IDV is close to 2 lacs, what is the amount in your view shall I receive as claim?

Thanks a lot for your help.

Regards,
Roopa Amit

To answer the questions:

1) If the Car is to be scrapped completely and not going to be refurbished (call taken by the owner) then the RC needs to be cancelled by writing an application to the RTO (dont know if they have a specific form for this). Once the RC is cancelled, provide the scrap dealer with all the vehicle related documents such as road tax receipt, registraion receipt, invoice document, last insurance copy & cancelled RC copy (BHPians may add any document missed out by me).
2) Yes, it is advised to have a scrap deal agreement on the stamp paper with details of document provided and reasons of scrapping duly mentioned. Take the scrap dealer receipt for the same.
3) Ideally the owner should be getting the IDV value adjusted on prorata basis but we all know the hardhsip one faces with the Insurer parting with the IDV in case of total loss. This needs to be negotiated with the Insurer.

There's a running thread on the forum regarding the same which may be helpful.
http://www.team-bhp.com/forum/indian...ping-cars.html

There's another useful link which may be refered to.
http://isalvageauction.blogspot.in/2...-of-major.html

I just scrapped my 20 year old car, so i can share some of my experience. most of the things should be applicable to you :

1. I consulted a lawyer, no stamp paper required. just have a simple contract saying you want to scrap the car and the buying party will scrap.

2. please ensure you put the following clause (lawyer insisted on the language)
- The BUYER promises that the vehicle is bought just for scrap purpose; and shall not use them at all as vehicles; and shall destroy the same.
- Incase the CAR is utilized in any manner, The BUYER (>>Buyer Name here<< ) would be liable for all purposes from hereafter.

3. Please ensure that the engine/chassis number from the engine bay is cut and given to you. RTO wants it back. I tried a lot to convince RTO that i want it for my records etc however they did not agreed. however in the letter for cancellation they have mentioned that they have the portion of the car. RTO went to the level that incase you do not give that to them, they would not cancel the registration and i can take a risk and not get my registration cancelled.

4. Incase the car A pillars are fine, please get them dented. its the most expensive stuff to repair through denting. in my case the scapper drove the car however i ensured there were atleast 10-15 high impact hammer marks over the frame with at least 4 of them on a pillars.

5. Please get at least 2 witness to sign on the contract.

6. Do not give original RC to scrapper, you need to submit the same to RTO

7. Take photocopy of of ID/Address proof of buyer, seller (you) and witness and annex it to the contract (i did it to ensure peace of mind)

8. Scapper will take RC photocopy and photocopy of your ID/Address proof with a letter that u have sold for scrapping. the best way would be all this in one page.. with photocopy of RC and your ID proof on top 1/3 page and that you have given for scrapping in bottom 2/3 page.

Process for cancellation of registration

- I was asked to get a NOC from NCRB, NCRB took a copy of letter to RTO, copy of contact along with annexure and gave me a stamped letter that this car is not stolen.

- I was asked to give a affidavit that i have sold the car and i would be liable for it if it is miss used. this is something that RTO require and said mandatory.

- RTO took the cover letter, copy of contract along with annex, metal portion of chasis number, our self attested ID/address proof and above mentioned affidavit and clearance from NCRB and issued me cancellation number on the spot.

HI Everyone,

My car got totally damaged and the repair estimate is crossing the IDV of the car. Estimate upto 6.4L I have few questions for which I need expert advise and help from all the TBHPians. Car was approximately 7 months old, has comprehensive Insurance with Zero depreciation.

1. Since my car is damaged totally - will I get a replacement Vehicle ? I have heard of a similar incident in UP amongst one of my friend's relatives.

2. Will I get a Road Tax refund considering my car will be scrapped now ? If so with what percentage of deductions will I get a refund ?

3. Is the Insurance company liable to replace the car or only pay the agreed IDV ?

4. Is it a better option to get the car repaired and sold later ?

5. I have a car loan balance on the car nearly for 4L ? How would the insurance company deal with this, what rights do I have ?

6. What other options do I have in this scenario ?

Any and all help here is greatly appreciated. I need guidance very badly.

Thank You.

Quote:

Originally Posted by Sunsh!nes (Post 3209094)

1. Since my car is damaged totally - will I get a replacement Vehicle ? I have heard of a similar incident in UP amongst one of my friend's relatives.

2. Will I get a Road Tax refund considering my car will be scrapped now ? If so with what percentage of deductions will I get a refund ?

3. Is the Insurance company liable to replace the car or only pay the agreed IDV ?

4. Is it a better option to get the car repaired and sold later ?

5. I have a car loan balance on the car nearly for 4L ? How would the insurance company deal with this, what rights do I have ?

6. What other options do I have in this scenario ?

To answer your questions:
1) Insurance co dont provide the replacment car
2) Yes, you can get the refund of the road tax. Contact the RTO to find more details about the refund process.
3)Insurance co is liable to pay only the IDV, but check with them as to how much they finally pay. Since some Insurance co ask the owner to sell the car to the scrap dealer and deduct it from the IDV on the policy, and pay the difference.
4)Since its declared total loss, no point in getting the car repaired. No structural integrity of the car.
5) This is a tricky one. I would like to know whats the process, have contacted my friend. Will post the info later.

Quote:

Originally Posted by ghodlur (Post 3209829)

Thank You for the info Ghodlur. Please let me know whatever information you can get your handson. TBHIans, please guide me here.

Quote:

Originally Posted by VaahanYogi (Post 3209647)

Amit Arya, if a car is older than 15 years, doesn't the registration expire? Isn't expired registration as good as cancelled registration?

I had done a fitness test when the vehicle was 15years old and hence got another 5 years. I had a experience where one of my uncle was driving a vehicle (post expiration of fitness, he totally forgot the 15 years) and got caught by police. i know the amount of agony.

Read some where in newspaper these old vehicle registrations play some role in moving stolen cars and i did not wanted to take a chance. when i am disposing the vehicle i think it was wise of me to get the RC cancelled.

Hi All,
I have been following Team BHP for a long time and was a passive reader, but now, unfortunately I need some advice. So here is the story...

We had a lovely Ford Ikon Flair 2004 model, and to date it was serving us well and extremely well maintained (because of my dad). It had clocked over 1.2 lakh kms and was still up and about to serve us. We were contemplating on getting a new car, and my mother was learning to drive in it. One morning on the 6th of April 2017, while my mother was driving alone, she met with an accident and the car suffered frontal impact. It was quite severe. Front axle, bumber, left fender, and door were damaged. However nothing happened to my Mom (Thank god!) and she got out of the car unharmed (all thanks to the seat belt). However the car was not in drive able condition and I arranged a tow truck and my Mom got the vehicle towed to the service center. Thus began the long process of claiming insurance. The IDV value declared was just over 2 Lakhs. The damage suffered to the car will cost us well over 1 lakh, and the insurance company as you all know is ready to give 50% or rather a little less than 50% to get the car repaired. Since we were thinking of buying a new car, and since the resale value of Ford Ikon is very very less, we are thinking of salvaging it as scrap. Now I have a few questions, they are as follows:

1) Can we take the decision of scrapping the car in-spite of it being in repairable condition ? or are we obliged to spend the required 60 thousand and repair it ?
2) What are the obligations of the insurance company if we salvage it ?
3) For example if a scrap dealer offers us 40 thousand rupees, will the insurance company be liable to pay us the rest of the IDV declared value ?

We really can't help it as we need to pay 60 thousand rupees from our pocket to get the car fixed and selling it for 80 thousand rupees wouldn't make sense after getting it fixed.

Quote:

Originally Posted by Rahulpnaik7 (Post 4184139)

1) Can we take the decision of scrapping the car in-spite of it being in repairable condition ? or are we obliged to spend the required 60 thousand and repair it ?
2) What are the obligations of the insurance company if we salvage it ?
3) For example, if a scrap dealer offers us 40 thousand rupees, will the insurance company be liable to pay us the rest of the IDV declared value ?

1. Yes, you can take the decision to scrap the car. You are not obliged to repair it, but you must ensure that it is not parked on public property and scrapped.
2. If the insurance company declares the vehicle as non-repairable and settles your claim, they will keep the vehicle in their salvage yard. Please note if claiming as salvage for insurance, the insurance company will decide this - not you.
3. No, the insurance company will only settle your claim once you file it and then they will decide if it's repairable or not. If not, they will take the car and pay you a settlement amount - no necessarily the same as the IDV. If you sell it as scrap and make no claim, then the insurance co will have no obligation.

Hi,

I lost my car to Chennai floods in Dec 2015 and the car was taken over by Icici Lombard as it was a total loss case.

Now it appears that Icici Lombard got that car repaired and sold it off to someone I don't know but that guy has not bothered to change the ownership with RTO. I've written to Icici Lombard and also my RTO via Registered Post AD but did not get any response.

Has anyone faced this situation? What more precautionary measures can I take to protect myself from any potential liability in future?

Thanks in advance,
RS

Quote:

Originally Posted by ronline (Post 4388578)

Since your car was taken over fully by the insurance company under total loss, they would have made the Indemnity and Subrogation on a stamp paper stating that your rights or liabilities over the car have been taken over by the insurance company. Hence you will not be in any kind of trouble as your ownership rights have been taken over by the insurance company by paying you the claim amount.

BTW how do you know that the new owner of the car has not changed the name ? (The vahaan sms is not that accurate in my opinion.)