Son brought a CAT N car without knowing, 2yrs ago.

[BankFodder]

I'm afraid that as a purchaser from a private seller, there is probably very little you can do – especially as you are two years down the line.

Clearly the potential buyer was sufficiently prudent to check it out. I'm afraid that your son should have done the same thing when he purchased the vehicle in the first place.

Not very good news to you that I'm afraid that that is probably the situation

[BankFodder]

Yes he should inform the insurer. If there was some kind of catastrophic accident and they investigated, they would soon find out the truth and it is very possible that they would deny any liability – especially if they found that the condition of the car somehow contributed to the accident.

When does the insurance run out? He needs to be careful that they weren't simply cancel his insurance and he would then be obliged to disclose that to a future insurer. If the insurance is about to run out then maybe he would be best advised simply to go to another insurer and disclose the categorisation from the outset and at least then the insurer can make up their minds whether or not to insure it.
Be aware that they may well refuse any insurance – but at least it won't count as a black mark against him. However he may be left with an uninsured vehicle which will make it even more difficult to dispose of.