We'll assume that your vehicle is severely damaged. It might have arisen from a fire, or theft damage. Let's assume that the repair costs will be ?5000. If the current value of your vehicle is for example ?5500 and the salvage valuation of the wreck is ?600 then it is cheaper for your insurance company to total loss the car rather than repair it.

Suppose that the salvage is only ?400. There is every chance that the insurance company will still total loss the vehicle. The estimated ?5000 repair cost is based on a external inspection and estimation of the repairs that might be needed. There could be more damage found once it was stripped down. So although it looks as if a repair is financially viable it would be regarded as a border line total loss.

They will ask to move the damaged vehicle into 'free and safe storage'. This is normally at a salvage dealer. Their reasoning isn't difficult to follow. Vehicle repair companies have discovered there is easy money to be made. They won't be given the repair job but they can bill your insurance company simply for storing your car on their premises. They've been known to charge extortionate daily rates that might make vehicle clamping fees seem like peanuts! Even the cheapest charges are on the scale of car parking fees in Central London. Insurers pay out vast amounts of money every year for storage charges so they want to move the vehicle at the first opportunity.

Owing to problems caused by a few policyholders they might just tell you that they are planning to move it in 48 hours rather than asking your permission. What has happened on occasion is that the salvage people move so quickly that the salvage truck is collecting the car before you've been informed that it is a total loss!. Naturally this can be upsetting to some people.

But thinking about the circumstances, please be sympathetic! The insurance company are not disposing of your vehicle, just moving it in order to lower costs. You could ask why you should worry about saving money for your insurer? The answer is simple. The more money that the insurer pay out on claims, the more you pay in insurance premiums. It is in your interest to keep their overheads down. My advice is - help them. Always agree to have your damaged car moved from a garage. If you don't, they can require you to pay the storage charges from the date of your refusal.

Sometimes when dealing with an older car, it can be a total loss yet still be perfectly safe and legal to drive. Maybe it has a low value and only some minor cosmetic damage. Often the insurance companies will give permission for you to keep this at your house whilst the procedural cogs keep turning, provided that it isn't clocking up any charges.