Groupama is to offer replacement vehicles to motor policyholders who suffer total loss accidents after clinching an exclusive deal with used car buying service One Stop Car Shop to supply the vehicles.

The insurer will also offer a hire vehicle while the replacement is being sourced.

Groupama manager Steve Crowe said: "This is a significant move in improving service standards to policyholders, as temporary transport is not automatically provided by insurers when a car is a total loss."

Under the deal, One Stop Car Shop will take a brief from the policyholder, noting make, model, specification and expected price of the car. It then provides the customer with a list of prospective cars from which to choose, the most promising of which is inspected by an engineer.

If a deal is agreed, the used car specialist delivers the vehicle to the policyholder's home.

Currently the service is available to customers whose cars are beyond economic repair, but in future Groupama hopes to extend the service to policyholders whose cars have been stolen.