Advice please

bloomerang72

I recently crashed my car, which the insurance company said was not covered because it had been written off prior to my buying it - something I was not aware of until the 'repairs engineer' telephoned me and told me - and it went to the underwriters to see if they would uphold my claim. I have just received a letter stating they are repudiating the claim and that they were cancelling my insurance from its inception date in May and returning my premium ('minus an administration fee'). I have had to buy a car to get me to and from work (the joys of Cornwall!!!!) and had transferred the insurance over to the new car - but they have cancelled my policy.
To insure with another company I will have to pay an extra £100 on top of the normal premium as I have had insurance cancelled, and was told that my no claims would not count as I had not protected it with this last company. But surely if they have not insured my car I can't lose my no claims?
Please can anyone offer any advice - I am going to speak to the Financial Ombudsman, but wondered if anyone had any snippets of advice?

dacouch

The following is a guidance note for Insurers from the Ombudsman, if you fit the criteria then you should go back to your Insurers and advise them of the Ombudsman's view and that you expect them to pay the claim and reinstate your policy

"
14. vehicles previously "written-off" and then repaired

Most buyers are (rightly or wrongly) put off by the knowledge that a vehicle was previously "written-off", no matter how well it was later repaired – and this can affect its value.
If the policyholder knew the vehicle was a repaired write-off, he/she is likely to have paid less for it. So we are likely to decide that it is not unfair for the insurer to make an appropriate deduction – not more than 20%, unless the insurer can provide good independent evidence for a higher deduction.
But if we are satisfied that the policyholder innocently bought (and insured) the vehicle in complete ignorance of its history, and the repairs were not obviously noticeable, he/she is likely to have paid full price (and a full insurance premium) for it. So we are likely to decide that it would be unfair for the insurer to pay less than the full market value."


Here is the relevant link
http://www.financial-ombudsman.org.uk/publications/technical_notes/motor-valuation.html

Are you sure the Insurer is repudiating the claim just because the vehicle was previously written off, or are there other reasons as well. If there are let us know and we may be able to help with these

raskazz

Like dacouch says, we need to know exactly they are voiding from inception. Some things in this seem amiss:

1) I've never known an underwriter void a policy simply because the policyholder's vehicle was a previous total loss. Either the underwriter concerned is a bit dim or there is another reason for the voidance.

2) The insurer cannot deduct an administration fee if they are actually voiding the policy, they have to return the premium in full.

bloomerang72

Thanks guys (or gals!)
They state thay they do not insure previously written off vehicles, which it does, in alll fairness, state in their T&Cs. they state;
'In accordance with your policy wording and also our business procedure, i am writing to advise you that your policy will be cancelled with from [!!!] its inception date, the 20th May 2009 and the policy declared void and I have instructed our claims team to repudiate your claim'

they then tell me I will receive a full refund minus an 'administration fee', but when I spoke to someone from the company they then said it would take over 6 months in case there was a 3rd party claim against me. but surely if I was not insured I am liable for any of those costs (plus it was a single vehicle accident into a cornish hedge, that even I can't see exactly where I bumped it.

dacouch

Quote what I posted from the Ombudsman and they will end up having to pay the claim and reinstate the policy (Assuming you comply with what the ombudsman says on written off vehicles)

raskazz

Sounds like they don't know what they are doing. Would you mind naming which insurer is involved?

If they are voiding the policy for non-disclosure they have to show that a clear question was asked during the quotation process along the lines of 'Has your vehicle ever previously been declared a total loss?' or that a clear statement was made to the effect that they do not quote for vehicles which are previous total losses. Even if they can demonstrate that this was the case I'm fairly sure that the FOS wouldn't look too kindly on them upholding a voidance where the insured had no knowledge of the previous total loss. In such circumstances most underwriters with any common sense would deal with the claim and then cancel the policy with no refund on the basis that cover had been exhausted (I'm assuming the vehicle was a total loss again from what you said regarding getting a new car).

Secondly, if they are voiding the policy they have to return your premium in full - they cannot hold it against potential third party losses.

bloomerang72

It's Swift for who the underwriters are Axa. I had to get a new car to be able to get to work and they wouldn't provide me with a hre car because my file was on hold while they investigated things,

Thanks for the tips I feel like I know what tp say to them now!:j