will insurance co pay claim to finance?

cp7

hi, my sister was in her car and someone smashed into her from behind. eventually he contacted his ins and admitted 100 per cent blame. so ins will pay out but they've wrote the car off and as there is finance outstanding will they pay finance co and not her? car worth 1000.

the finance is not hire purchase but some loan credit agreement arranged by dealer, thing is she'd rather she just continued to pay car off as she's not working at moment so doesn't want or probably won't get another car loan, but she could use money to buy a runaround. if insurance pay finance co she will probably have some finance still to pay herself and no money and no car.

seems unfair but is this correct?

dacouch

In most cases they will settle any outstanding finance if it is registered against the car.

cp7

hi thanks for reply. what does it mean when you say registered against the car? can finance co demand payment from insurance co or is my sister allowed to keep paying if she chooses?

can she tell insurance co to pay her if she legally owns the car if not on a hire purchase agreement but what appears to be a personal loan?

Quentin

If she got a personal loan, then how she spent the loan doesn't concern the insurer. They will deal with your sister, not the moneylender. There is no reason why the insurer will know about a personal loan.

Quentin

dacouch wrote: »

In most cases they will settle any outstanding finance if it is registered against the car.

They wouldn't "settle" any outstanding finance. Any payment would be based on the current value, and it would just be "tough" if this didn't cover the finance outstanding!

mattymoo

If she is claiming from the other drivers insurance company then they will not make a finance check anyway.

They will do a simple check to see if the vehicle has been written off before, since this would affect its current value.

Their offer / settlement will be say £1000 veh value less £100 scrap value = £900 to your sister. What she then does with that £900 is of no concern to them. She keeps the vehicle and disposes how she sees fit.

cp7

hi all and thanks for replies. it is being paid by third party ins so she should get money then that's fine.

wonder if she should get car back as the ins inspector said it was prob dangerous but i thought she should get it fixed a lot cheaper in another garage but as its category c write off wonder if more trouble than its worth? i think that means the mot is now invalid and she'd need to get another one.

Quentin

She would just need a VIC (vehicle identity check) after it was repaired to be able to put it back on the road.

The current MOT will suffice till its normal renewal date.