Sharp practice?

Captain_Tightwad

My son recently boght a '56 plate Pegeot 207 from a main dealer for £6600. He insured this vehicle for that value. Within 2 hours of his taking delivery the car was destroyed by an engine fire. The insurance company has offered £5900 (minus deductions). My question is can they do this seeing as Huw paid the premium to insure his car for the price he paid for it - £6600? Any thoughts, folks?

dacouch

Have a read of section 9 of this link from the Ombudsman and then refer his Insurers to it, please also read the rest of the link as there is helpful information contained in it.

http://www.financial-ombudsman.org.uk/publications/technical_notes/motor-valuation.html#13

Loughton_Monkey

You must remember that you do NOT insure your car for any specific value. Yes, they do ask its value, but normally it has no effect on the premium - which is calculated more on the age/experience/residence of the driver. Unless you have some sort of "new for old" policy, you will find that the Insurance Company is obliged only to pay the correct "market value" (less any excess).

However, you do have a case, since by definition the price of £6,600 seems to be a fiar market value if that's what you paid. I assume you negotiated! Try to find other similar cars at similar prices in main dealers to strengthen your case. Then write an official complaint to the Insurer, stressing that you had shopped around, haggled, and negotiated a fair market price of £6,600. This official complaint is a pre-requisite to going to the Ombudsman, but they are obliged to respond in writing, and if they do not pay in full they must give you all the Ombudsman details. This will take time.

BenL

I was under the same understanding as dacouch and that link provided.

I read somewhere that "recently" refers to 9 months.

Do they list the deductions?

Mandatory Excess
Voluntary Excess

Will young/inexperienced driver excess apply for your son?

Total wise this could get to the £700 difference.

Ben

vaio

As the fire happened within two hours of delivery I'd be looking to the garage to sort it out under sale of goods rather than geting a fault claim on my insurance with all the increased premiums & loss of NCD that entails