What Happens to a Car or Vehicle When Someone Dies?

A car or vehicle owned by the deceased forms part of their estate. As executor, you are responsible for securing it, valuing it, and either selling it or transferring it to the relevant beneficiary. There are a few practical issues -- insurance, DVLA notification, and outstanding finance -- that need attention quickly.

Notifying the DVLA

The DVLA does not need to be notified of the death immediately, but it must be informed when the vehicle changes hands -- either to a beneficiary or to a buyer. You do this using the V5C logbook (the vehicle registration certificate). The V5C should be in the deceased's name, and you will need to find it among their documents.

If the vehicle is being transferred to a beneficiary, the new keeper completes the relevant section of the V5C and sends it to the DVLA. If the vehicle is being sold, the same process applies. If the V5C is missing, you can apply for a replacement using form V62 on the DVLA website.

Personalised number plates are a separate matter. If the deceased held a personalised registration, this may have monetary value. Plates can be retained and transferred or sold through the DVLA's online service. Do not let the vehicle's MOT or tax lapse before this is resolved, as the plate could become more difficult to retain.

Insurance and keeping the vehicle on the road

The deceased's motor insurance policy ends on death. The vehicle must not be driven by anyone -- including the executor or a family member -- unless they have their own insurance covering that specific vehicle. Driving without valid insurance is a criminal offence regardless of the circumstances.

Contact the insurer to notify them of the death. Ask whether the policy can remain in place to cover the vehicle while parked (some insurers allow this during the administration period; others will not). If the vehicle will not be driven and will be kept off the public road, you can declare it SORN (Statutory Off Road Notification) using the DVLA website. A SORN vehicle does not need road tax or a valid MOT, but it cannot be used on a public road.

If the vehicle needs to be moved -- to a garage, for a buyer to inspect it, or to deliver it to a beneficiary -- make sure appropriate insurance is in place first.

Outstanding finance -- HP and PCP agreements

Many vehicles are subject to a hire purchase (HP) or personal contract purchase (PCP) agreement. Under these arrangements, the finance company owns the vehicle until the final payment is made. This matters because the vehicle cannot simply be sold or transferred -- the finance must be settled first.

Check the deceased's paperwork or bank statements for any regular payments that suggest a finance agreement. Contact the finance company to notify them of the death and ask for a settlement figure. The settlement figure is the amount needed to pay off the agreement in full and release the vehicle for transfer or sale.

The settlement amount becomes a debt of the estate and must be paid before the vehicle can be transferred or sold outright. If the estate cannot afford to settle the finance, the finance company may repossess the vehicle. In that case, if the vehicle is worth more than the outstanding balance, the surplus may be returned to the estate after repossession and sale. If the vehicle is worth less, the shortfall is an unsecured debt of the estate.

Selling a vehicle during probate

You can sell a vehicle during the administration of the estate -- you do not need to wait until probate is granted to do so. However, you must disclose to the buyer that the vehicle is being sold as part of a deceased's estate. Most buyers and dealers are familiar with this. Selling through an auction or to a motor dealer is often the simplest route.

Get the vehicle properly valued before selling. You can use a professional valuation service, or check published trade guides (such as Glass's or CAP) for a market value at the date of death -- this valuation figure is what goes into the estate accounts for probate purposes. Keep a record of the sale price and pay the proceeds into the estate account.

If a beneficiary wants to buy the vehicle from the estate, this is allowed, but the sale must be at open market value. An executor cannot sell an estate asset to a beneficiary at an undervalue.

Transferring a vehicle to a beneficiary

If the will (or intestacy rules) means a specific beneficiary is to receive the vehicle, you can transfer it to them once the estate administration is sufficiently advanced. Complete the V5C change of keeper section and send the relevant parts to the DVLA. The beneficiary takes on responsibility for insuring and taxing the vehicle from the point of transfer.

Keep a record of the transfer for the estate accounts, using the agreed or open market value at the date of transfer. If the vehicle has risen significantly in value since the date of death, there may be a capital gains tax consideration for the estate -- seek advice if this is a possibility.

See also our guides on executor duties, what happens after probate is granted, and selling property during probate.