I looked into this a bit when I bout by coupe back in December. The CAT C vs D thing isn't that well defined; internet searches will explain how it should be. I think the key point for CAT C is that it is 'beyond economic repair' in the view of the assessor. Which for these cars at this age its fairly easy to qualify for!
My coupe is CAT C (One of Carlt's stock)! A replacement bonnet & foglights, weld the bumper & spraying was all that it took to put it back on the road.
Book your VIN check now; as they take forever to get an appointment
On the other hand consider why the owner made the claim for the vandalism (& got it wrote off); are there any hidden nastys. That said its £700!