Two of the State's largest insurers depend on salvage companies to notify the Department of Transport if cars insured by them have been written-off in crashes, according to a report that is now the subject of an official investigation.
At present only the owners of cars are obliged to notify the department if the vehicles have been written-off, and not the insurers nor salvage companies.
The investigation, involving the department, the Garda, the Revenue Commissioners and the Road Safety Authority (RSA), was launched after the RSA received the report by private company, Cartell.ie, into claims that cars classed as write-offs have been returned to the road.
The Cartell report analysed a list of write-offs held by a major insurance company and compared this with the State vehicle register, the National Vehicle File (NVF) held at the department. It discovered that some write-offs had been re-taxed by new owners and had even passed an NCT.
The report concludes that there was a wide disparity in the level of communication between the insurers and the Vehicle Registration Unit (VRU) in the department and that two of the largest insurers let their salvage companies notify the VRU about write-offs. It is the responsibility of car owners to report to the department if their car has been written-off.
Cartell's report, which has been seen by The Irish Times, concludes that a problem exists with write-offs returning to the road in high numbers, but that the true extent of the problem can be ascertained by running cross-checks between existing databases held by insurers and the VRU.
Insurers keep their own list of write-offs, separate to the NVF, but a spokesman for one insurer, Allianz, has said legislative changes would be needed to make this public or available to the VRU. Cartell concludes that the main reason for the problem of write-offs returning to the road is a breakdown of communication between the insurance industry and the VRU. It says half the insurance companies use an intermediate to communicate with the VRU.
"Unfortunately this intermediate is typically a salvage dealer and therefore may have a vested interest in whether or not a write-off is notified to the VRU," says the report. "Remember that the salvage dealer has bought the salvage and may seek to make a profit by allowing a repairer (obviously not a reputable one) purchase the salvage and repair it. If the salvage dealer does not notify the VRU then that vehicle can legally be licensed as the Government has no idea the vehicle was ever written-off."
An official at a motor tax office told The Irish Times that it could not guarantee that write-offs were not being repaired and resold because vehicle registration certificates were not being returned on some write-offs, allowing the cars to be resold.
Noel Brett, chief executive of the RSA, said its examination of the allegations was continuing and that it would be inappropriate to comment until it was concluded. It is expected to be a number of weeks before the investigation is complete.
