Insultingly low car insurance payout- NO FAULT ACCIDENT

kyusho

Hello everyone,

I am looking for some advice. Recently my car was written off, and the third party admitted complete liability. My insurance company, Admiral, have made a first offer of £5000 for my car. A BMW 330CI worth around £8000. They have written me the following letter;

We have decided to settle your claim on a "total loss" basis. We have based our valuation on the current market value of your car, calculated as follows:

Market Value £5,000.00
Less Excess £0.00
Settlement figure £5,000.00

Our settlement cheque will follow shortly. Banking our cheque will not prejudice your position.

If your car is still at a garage or in storage, please remove any personal belongings immediately, as we will shortly move it to a place of storage.

Please send your written acceptance of our valuation within the next 14 days. If we do not hear from you, we will assume that you accept the valuation and will dispose of your car.

If your car has a private plate, please contact us if you wish to keep it. We will pay reasonable recovery and storage charges as shown in your policy.

Now I don't understand the whole process and have a few questions.

1. Firstly, by cashing the cheque what the letter is saying is that I can still contest the amount they are paying? Or should I return the cheque together with my letter (below).

2. This is a Non Fault accident. My insruance company are refusing to take any optional extras fitted to the car into consideration- but as it is the third party paying out, surely this shouldn't be a proble?!

3. I have suffered other losses through no fauly of my own. I am set to lose £478 over the next 5 years on increased car insurance premiums. When the accident occured I had literally just filled my car up with £70 of petrol (have receipt).Also my satelite navigation was smashed in the collision. How can I claim for these expenses?

Here is the letter I intend on sending them. Are there any adjustments I should make? I am including a detailed search of car prices of the same age, condition, model and milage as mine. I am also including quotes from dealers like BMW to find a similar car, as well as a number of car price guides suggesting their initial offer is less than satisfactory.

I am writing to you in reference to your recent unrealistic offer of £5000 for my BMW 330 CI Sport, which was deemed uneconomical to repair following a NO FAULT accident for which the third party have accepted 100% liability.

It is clear there has been a mistake when calculating my vehicles market value. I wish to repudiate this offer on the grounds that an equivalent car cannot be purchased for anywhere close to £5000. I have enclosed detailed information of equivalent, similarly equipped cars of the same age and similar mileage and condition to my own. This clearly illustrates £5000 in substantially insufficient compensation.

My BMW was in immaculate condition pre accident, and I searched for many months to find one in such good condition with an extensive specification, FSH and in the most desirable colour- Black. My car was fitted with a whole host of expensive optional extra’s from the factory which I have listed overleaf. My extensive research indicates in current market conditions, I would need £7750 to purchase an equivalent, similarly equipped car.

If I do not receive a substantially increased offer from you within seven days from the date of this letter, I want my case referred to your in house compliance department for review. In addition, I am also requesting interest payable on the final insurance payout figure. This will be calculated from the date your unrealistic offer was received (26-03-2010), to the date a more realistic offer is agreed.

If a satisfactory offer is still not received, I will not hesitate to refer my case to the FOS and FSA to recoup the compensation I am legally entitled to.

I look forward to receiving a more accurate valuation within 7 days,

M**** S*******

Cool_Username

I don't know much about insurance but I do like the letter you sent them in response

kyusho

Thanks- I delibrately wrote the letter in that tone, so that they know I am not messing about here, and will not stand for their games and ludicrous valuation of my vehicle.

Cool_Username wrote: »

I don't know much about insurance but I do like the letter you sent them in response

Cool_Username

Don't blame you one bit.

dacouch

Whats the exact year, model and mileage of your car?

Annisele

It might help to tell them a bit more about your "extensive research". For example, if Glass says your car was worth £8k that will help your case considerably; if you've found a car like yours for sale at £8k that won't help you much.

The Financial Ombudsman Service publishes a note on car valuations at http://www.financial-ombudsman.org.uk/publications/technical_notes/motor-valuation.html - have a look through that and see if you can find anything to support your case.

I'd get rid of the reference to referring your case to the FSA - the FSA don't care about individual consumer cases; that's the FOS's job.

Edit: sorry, you do say you've enclosed detailed information with your letter. However, I'd still have a look at the FOS guide and see whether the information you've enclosed is likely to sway FOS - if it wouldn't, it probably wont' sway the insurer.

kyusho

BMW 2003 330 CI M SPORT, 78k £7000 is a more realistic valutaion, but I just put £7750 so there is room for more negotiation..

dacouch wrote: »

Whats the exact year, model and mileage of your car?

kyusho

Yes- All used car price guides say my car is worth between £7000-£8000 and I have included this information on a seperate document (enclosed with the letter).

I'll have a look at that site, thanks

Annisele wrote: »

It might help to tell them a bit more about your "extensive research". For example, if Glass says your car was worth £8k that will help your case considerably; if you've found a car like yours for sale at £8k that won't help you much.

The Financial Ombudsman Service publishes a note on car valuations at http://www.financial-ombudsman.org.uk/publications/technical_notes/motor-valuation.html - have a look through that and see if you can find anything to support your case.

I'd get rid of the reference to referring your case to the FSA - the FSA don't care about individual consumer cases; that's the FOS's job.

Edit: sorry, you do say you've enclosed detailed information with your letter. However, I'd still have a look at the FOS guide and see whether the information you've enclosed is likely to sway FOS - if it wouldn't, it probably wont' sway the insurer.

kyusho

I had a read of that wesbite, and they say that if the vehicle was recently purchased 2nd hand then the FOS will assume that is the current market value of the vehicle. I purchased my car in Nov 2009 for £8000 with receipt, and it was written off in Feb 10th 2010.

They also state they make a valutation based on guides like parkers for the month in which the car was written off- again, this says around £8000. THey say they go for the private dealers valuation.

Should I point this information out in my letter, to strengthen my case?

dacouch

Optional extras do not have a massive effect on the value of a car.

Your Insurers have to ensure the amount they value your car is fair as when they go to the other insurer for reimbersement they will only pay them the market value so if they over value it they will lose out.

Your sat nav could be claimed under the personal effects section of the policy although this is generally limited to circa £100 to £150. If this is not sufficient you could recover the cost of this seperately from the other Insurers.

The ombudsman does not take much notice of adverts for similar cars as they are regarded as an invitation to start negotiations at.

Have a read of the Ombudsman guidance about write offs as this could be helpful, these are in effect rules for Insurers to follow, particuarly have a read of 2,8 and 11

http://www.financial-ombudsman.org.uk/publications/technical_notes/motor-valuation.html

Rolandtheroadie

Am I missing something? Admiral are paying you the 5k quickly to help you out as they are YOUR insurer.
You can cash the cheque, get the 5K in your pocket and argue the toss with the company that covers whoever you are making the claim against.
Why are you falling out with Admiral?

Compensation? What for? Is this additional to the value of the vehicle?