I think the OP is saying that they've found out that the car is down as Cat B, and has been for a number of years, but they never knew until now. Not that the 'new' accident has resulted in the car being declared cat B.

Unfortunately, if you didn't get a HPI (or equivalent) check done when you purchased the car, then you've got nothing to go back to anyone on. The car could have had finance owing on it, and only a HPI check would have picked up on that too.

Sadly, unless you've got paperwork from when you bought it, or the seller was a motor trader, then I think you're going to end up taking this on the chin, and learning a (painful) lesson.

It is much more likely that the car has, at some stage in it's life, had a cherished plate on it.

If that same number has been on a car that has been the subject of a total loss, either before or after it was on the TT, then the insurance company could well have been misled by the facts.

HPI the car now. Establish whether the number has been the subject of a write off and contact HPI for a detailed history. We have very often found discrepancies by taking this route and found that the car in question has a clean "real" history, despite a scare similar to what you, and your insurers, have experienced

I may be being naive, but surely if the OP has had the car for three years and it has had tax, MOT and insurance throughout this time, why should he be disadvantaged now?

If the insurance Co took his money to insure it without checking it was aledgedly a write-off, why should they wriggle out now that there is a claim (I am well aware that insurance co's do try to wriggle) I think I would be straight onto the ombudsman if the insurance Co don't play ball within a set timeframe, i.e. give them an ultimatum, sort the claim in ten working days, or I will contact the ombudsman

I would suggest the insurance co are culpable as they have either made a gross erorr now, or they failed to carry out diligent checks when first providing cover!