Norwich Union (NU) is offering customers with a write-off a used vehicle replacement service.

If their car is written off but worth more than £2,500, the customer will receive a cash settlement and can opt to have a used car sourced for them by Replacement Vehicles, NU’s vehicle broker partner.

Initially it appeared from the insurer’s announcement that NU would actually source the replacement for the customer, but it simply passes the customer on to the broker. Replacement Vehicles will then contact its panel of dealers for cars which might meet the customer’s requirements. 

Erik Nelson, NU spokesman said: “It is a flexible system for our customers to get a vehicle on the road again. Anybody short on time or not interested in which car they get will feel comfortable leaving the details to a partner of NU.”

Customers can choose a car of their choice, and either downsize, with cash to spare from the settlement or upsize, adding the money needed to buy the vehicle.

Use of the service will not alter the cost of the claim. It was aimed at improving customer service and policyholder retention.

“It is a new service which we think is unique,” said Nelson. “We’ve got the infrastructure in place, so it’s fairly easy to role out.”

A pilot began in September 2006, and so far 200 people have taken up the used car replacement service.

A new car replacement service has been in operation for a while.

NU was unwilling to give expectations for future success of the scheme.