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Do I need to tax our car while we're in dispute with an insurer over a settlement figure?

Last month my daughter's car was hit while parked and the insurers are saying it is a write off. I am currently arguing with them over the settlement figure. The problem is the road tax ran out on 31st December. I understand the DVLA may issue a fine if it is not taxed or SORN declared. Do I SORN it or declare it a write off before I receive the settlement?

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Are you retaining the car? If not the rest is a non-issue if the vehicle is a total loss and the insurer is going to dispose of the salvage. In that case you do not need to tax (or SORN) it. If you are retaining it, you will need to tax it.
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