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VIC scheme - responses make interesting reading

Insurance write off
Any guesses to the easiest route to repair this vehicle recently for sale on eBay - Hopefully the insurance industry will take note of the comments levelled against their Code of Practice as better control would do far more to reduce car crime than the VIC ever could.
We told you towards the end of last year that the government were asking for views on the VIC scheme. Recently they published a summary of the responses and it is good to see that many of those response originated from this industry.

As you are probably aware, the scheme was introduced in 2003 to help combat vehicle ringing and the consultation sought to determine the future of the VIC scheme and whether the scheme is fit for purpose. The following proposals were considered as part of the consultation:
Retain the scheme in its present format.
Re-scope the scheme.
Abolish the scheme.

The Department For Transport received a total of 24 responses from trade associations, car repairers and individuals as well as police and vehicle identity officers and of those, only one response was in favour of keeping the scheme in its current form.

The majority of the responses recognised the need for change. Some indicated a preference for change to the criteria used for selecting vehicles to go through a VIC, others proposed changes to the way the checks are carried out, whether with government regulation or industry self-regulation. Four responses expressed a preference for the system to be abolished. However, of these, three felt there would still need to be some non-governmental regulation.

Here at atfPro, we have already stated our opinion see previous article
that the scheme should be abolished as it has been so ineffective. One respondent to the government's call said, “No, it simply is a waste of time and money, the cars which need testing are cheap cars with mostly a small dent which doesn’t need repairing. Nobody in their right mind rings cars like this and it shows with only finding 38 cars. Yet on Copart [auction house website] expensive cars come up every week as cat D, for instance there was an Aston Martin Vantage with the roof cut off cat D. No one is going to repair that properly, in fact I’m sure who ever bought it did ring it. So how many expensive cars go through the massive loop hole in the VIC test system as it stands? Also the waiting list for VIC tests is a joke, I frequently have to wait over 6 weeks to get an appointment, which when I’m trying to repair and sells cars is a great inconvenience.”

The MVDA’s response, which is our industry’s representation highlighted the following points, “The very low number of ringers uniquely detected since VIC was introduced (less than the quoted 38). The very high cost borne by sellers and purchasers of salvage bearing a VIC marker (probably in excess of £125 million, or greater than £4 million/ ringer detected). The fact that the burden on this extra cost has fallen disproportionately on [our] members (due to reduced cat C salvage value), which are mainly small family businesses,. The high proportion of vehicles bearing a VIC marker that do not go through the scheme (70%) and the significant proportion (30%) that remain entirely unaccounted for.
The lack of objectivity within the consultation document and accompanying Impact Assessment.
The lack of clarity of data presented.
The disparity between the ‘hard data’ and the conclusions drawn leading to a significant under-estimate of the true cost benefits of abolishing the scheme.
The ‘disproportionality’ of the VIC scheme in the context of overall vehicle crime.
The likelihood that the ‘missing’ insurance vehicles constitute just a small fraction of a much larger problem of ‘missing vehicles’, and that is where the limited resources available would be better focused.
The opportunities presented by the ongoing Home Office review of the Scrap Metal Dealers Act 1964 and the Motor Salvage Operators regulations, and the DVLAs online initiatives, give scope for considerable ‘tightening’ of the system while removing unnecessary, burdensome and economically damaging legislation.
It is should also be pointed out that a vehicle does not have to have been repaired when presented for a VIC. This means it is entirely possible that an ‘unrepaired’ or partly repaired vehicle could be ‘rung’ after the VIC has taken place. Furthermore, the IA asserts that VIC gives consumers some protection from buying an un-roadworthy vehicle. This is not so. VIC has no remit to check road worthiness – this is the role of the MOT.”

Comments were included regarding the standards of insurance classification that appear to vary greatly between insurers as the Code of Practice used to classify write-offs is voluntary and vague, and so there is a demand for more robust standardisation across the industry. One response said, “Fundamentally, the link of legislation to a voluntary Code of Practice is fraught with difficulty, due to the considerable subjectivity of the COP. The fact that salvage classification is the product of a voluntary COP, and not legislation continues to present problems in that compliance with many aspects of the COP is inconsistent, and unenforceable. Not only do the category classifications vary considerably between individual insurers, but the category applied to a salvage vehicle has a dramatic effect on its subsequent value. This has led to concern about the manipulation of vehicle categories so as to allow certain desired commercial outcomes to be achieved.”

The problem with insurance categories has been covered here many times. We have another fine vehicle shown at the top of the page for you and hopefully the insurance industry will take note of the comments levelled against their system as better control of their COP would do more to reduce car crime than the VIC ever could. We have only scratched the surface of the responses here and a full copy is available from the MVDA
office (unfortunately members only) if you would like to know more.

June 2013

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