Insurance loophole puts used car buyers at risk of purchasing a write-off

An investigation has discovered that one in 50 previously written-off cars are being put back on the road with a clean history as a result of an insurance database loophole.

Conducted by Autocar, the study looked at the Motor Insurance Anti-Fraud Theft Register (MIAFTR) which is used by insurers to record the details of cars that they have written off. It is then looked at by vehicle check companies when confirming a car’s status.

However, MIAFTR is a voluntary scheme and not all of the UK’s 200 insurers are subscribed to it. It means that some write-offs can be sold with an incorrect status.

First highlighted in 2019, the issue now means – according to Autocar – that every year 15,000 vehicles that should be declared as written-off are returned to the market unrecorded, equivalent to one in 50 of all vehicles written off by insurance companies.

It means that cars that appear to have a clean record at the point of purchase could, in fact, have been written off by an insurer previously.

Motorcheck, a vehicle history checker, told Autocar that at any given time more than 2,000 cars are advertised with a clean history despite having serious issues with their past life.

Mark Tisshaw, Editor, Autocar, said: “Used buyers are at risk of unknowingly buying a written-off vehicle because of this loophole in the industry. A single vehicle health check is no longer a good enough guarantee, as our investigation found owners had bought cars which had been incorrectly flagged as not written-off by a vehicle health check provider.

“The Motor Insurance Bureau (MIB) has told us they are introducing new measures to improve the database, but for now buyers remain at risk of inadvertently buying second-hand cars with incorrect histories, as well as having to rely on multiple vehicle check agencies to get an accurate understanding of their potential purchase’s background.”

According to the MIAFTR, around 700,000 claims are added to its register. Despite this, vehicles insured under third-party or those self-insured by their owners – such as local councils and police forces – aren’t entered into the database.