Insurance chasing B-in law for an accident over a year Ago

learningaboutinsurance

Hello Good people, i am here for some advice for my brother -in Law.

back in early 2011, he had an accident with another car at a roundabout he hit the rear but he assumed she had gone. anyways the stupid idiot apparently did not have insurance at that time (believe me we gave him hell about this).

she obviously claimed whiplash for her and her passengers in her car. the thing is he knew the driver as she was a local literally about 5 mins apart from each other any ways he wanted to avoid her insurance company knowing about it for the obvious reason stated above and wanted to pay her for the damages and a little extra. she declined and she went through her insurance company.

any way a year on he received a letter from her insurance company demanding 25k to be paid or court action. i have not seen this letter (as i live in London and he lives in Manchester) so not sure if it is already a summons for a letter stating court action will be taken.

but B-in law is under the impression his insurance (he is now insured) that they will pay. i thought never but i just wanted to be sure could anyone confirm if this true

also he earnings are very limited and i think he will not be able to pay, he has disgusting credit history so he will not get a loan all he has is a mortgage. can i ask will his house be taken should this go to court and he loses?

lisyloo

B-in law is under the impression his insurance (he is now insured) that they will pay

No his current insurer will not pay for an accident he had previously.

can i ask will his house be taken

Usually judges will not evict people from their homes for relatively small debts (relative to the house).
An attachment of earnings could be made where his employer is forced by the courts to deduct a certain amount from his wages.
An alternative is that a charge for a lump sum is attached to his home, so it's a debt but secured on the house.

and he loses?

We don't know the circs but 99% of the time if you hit someone in the rear you are liable and you said yourself that he had assumed she was gone.
Whether the £25K is fair compensation is another argument but by being uninsured he has left himself without an free legal advice or defence for the civil matter.

There is of course the chance that he may face a criminal prosecution for being uninsured.

My guess is that as soon as the 3rd party realises they can't get money from him easily they will claim off the MIB (motorists insurers bureaux) which is set up for this eventuality. The "victims" will get their money a bit quicker and the MIB may well in years to come try to get the money back off your BIL.

Ultimately it is impossible to get blood from a stone, so if he doesn't have the money then of course he can't pay, but they can get money from his earnings and they can look to attach a charge to the house to get the money back in future.

dacouch

As Lisy mentioned his new Insurance will not cover him as car Insurance covers claims occurring during the period of Insurance.

Has he declared the accident to his new/current Insurers, if not it could cause major problems if they discover it at a later date. If he has not his best bet would be to just ring them now and declare a fault accident happened on whatever date it was. Him not being insured will probably not come up.

The claim may be paid by the MIB and they may come after him for the money in the end.

What will probably happen is they will put a charge on his house so whenever he sells it the debt plus interest is paid. Be aware that injury claims cost many thousands each when you factor in the solicitors fees so two relatively minor whiplash injuries could easily cost £3k each so the eventual bill for everything could be well over £10k. Occassionally they will force the sale of a house but this tends to be when there is no one else (Other than BIL) living in the house.

The other party were perfectly within their rights to claim through their Insurers rather than deal privately with your BIL.

This will ultimately end up costing him a large amount of money

learningaboutinsurance

lisyloo wrote: »

No his current insurer will not pay for an accident he had previously.

Usually judges will not evict people from their homes for relatively small debts (relative to the house).
An attachment of earnings could be made where his employer is forced by the courts to deduct a certain amount from his wages.
An alternative is that a charge for a lump sum is attached to his home, so it's a debt but secured on the house.

We don't know the circs but 99% of the time if you hit someone in the rear you are liable and you said yourself that he had assumed she was gone.
Whether the £25K is fair compensation is another argument but by being uninsured he has left himself without an free legal advice or defence for the civil matter.

There is of course the chance that he may face a criminal prosecution for being uninsured.

My guess is that as soon as the 3rd party realises they can't get money from him easily they will claim off the MIB (motorists insurers bureaux) which is set up for this eventuality. The "victims" will get their money a bit quicker and the MIB may well in years to come try to get the money back off your BIL.

Ultimately it is impossible to get blood from a stone, so if he doesn't have the money then of course he can't pay, but they can get money from his earnings and they can look to attach a charge to the house to get the money back in future.

Thanks for your reply,

I believe the house is worth about 120k (he bought it for 60k). yes that is what i had thought the house will be secured to the 25k and he will need to make payments towards this

I think the 3rd party has been paid by the TPI insurers and its her insurers who are chasing him for the payment of 25k.

i think this is what we are all afraid off and praying they will not go for a criminal charge.

I think regarding your point on MIB, i think they did not go for this and i think the 3rd party got her insurers to pay and as 3rd party knew my b-in law she gave her insurers his details and i think they are chasing for the money

I guess we are hoping is first part where his wages are deducted each month towards this

lisyloo

I believe the house is worth about 120k (he bought it for 60k)

Ah right.
If he has equity he might (mathematically) be better off remortgaging and paying up. My thinking is that his mortgage interest may be less than whatever is applied if he doesn't pay up. I'm not sure what they are allowed to charge TBH but mortgage rates are currently quite low.

I guess we are hoping is first part where his wages are deducted each month towards this

If he has equity i.e. owns half his house, then why doesn't he get a loan against this i.e. re-mortgage?

lisyloo

He should also be aware that having his employer fored to pay through a court judgment is pretty bad news from the point of view of his relationship with his employer.
They will not be happy about receiving orders from a court neither will they be happy about having to do the extra work for free required to pay this.

I would have thought it would be sensible to avoid involving his employer if at all possible.

learningaboutinsurance

[QUOTE=dacouch;57514885]Has he declared the accident to his new/current Insurers, if not it could cause major problems if they discover it at a later date. If he has not his best bet would be to just ring them now and declare a fault accident happened on whatever date it was. Him not being insured will probably not come up.[/QUOTE]

Thanks Dacouch, thats a very good point, i didn't actually ask him about this, will ask him today.

I totally agree with your point the TP has total right to do this and agree its my idiot BIL fault for not insuring the car and himself

learningaboutinsurance

lisyloo wrote: »

If he has equity i.e. owns half his house, then why doesn't he get a loan against this i.e. re-mortgage?

I do not think this is possible, as again his is a no1 muppet and has already re-mortgaged his house a few years go for (you won't believe it 25k :eek:) and spent all off it

and i do not think the bank will ever give him money

learningaboutinsurance

lisyloo wrote: »

He should also be aware that having his employer fored to pay through a court judgment is pretty bad news from the point of view of his relationship with his employer.
They will not be happy about receiving orders from a court neither will they be happy about having to do the extra work for free required to pay this.

I would have thought it would be sensible to avoid involving his employer if at all possible.

not sure how this will plan out but would they allow him to go on a payment plan? this way he employer doesn't need to know and it will be like setting up a DD in which his wages will just be deducted

lisyloo

The insurer may be willing to accept a payment lan if there is no other realistic avenue of getting the money.
He should expect to provide all his financial details e.g. P60 to justify whatever he wants to negotiate.

The other question is whether he should just accept the bill without question.
Normally an insurer would dispute any amounts they thought were too high. Unfortunately he has left himself without an insurer on his side, but he could try to get some advice on whether he should fight the bill.
Just because someone has demanded £5K compensation doesn't mean that's what they should get and it's unlikely they'd get the asking amount if there was a solicitor acting for your brother. Of course proper paid advice is expensive.

That doesn't mean he shouldn't take to the CAB or try to negotiate down the bill himself.
Insurers would have teams of people whose job it is to go through these bills with a fine tooth comb and dispute them to get the amount as low as possible rather than just paying out. The insurer is in a weak negotiating position as he doesn't have the means to pay so yes normally they would be keen to get his agreement to something as getting something from him is better than getting nothing.

Would he have any equity left over if he sold his house?

One option is to make them a low ball offer e.g. £10K and sell the house to pay it.
He's got a good deal and is free of the debt.
They've got something now which they might prefere to waiting 20 years or until he sells the house.

vaio

learningaboutinsurance wrote: »

.........I think the 3rd party has been paid by the TPI insurers and its her insurers who are chasing him for the payment of 25k. ......

Nah, the other drivers insurer would pay for the car repairs (if she was fully comp) but not for the injuries

lisyloo wrote: »

.........The other question is whether he should just accept the bill without question.
Normally an insurer would dispute any amounts they thought were too high. Unfortunately he has left himself without an insurer on his side, but he could try to get some advice on whether he should fight the bill.
Just because someone has demanded £5K compensation doesn't mean that's what they should get and it's unlikely they'd get the asking amount if there was a solicitor acting for your brother. Of course proper paid advice is expensive.

That doesn't mean he shouldn't take to the CAB or try to negotiate down the bill himself.
Insurers would have teams of people whose job it is to go through these bills with a fine tooth comb and dispute them to get the amount as low as possible rather than just paying out. The insurer is in a weak negotiating position as he doesn't have the means to pay so yes normally they would be keen to get his agreement to something as getting something from him is better than getting nothing........

As this is likely to go to the MIB once the other side realise there was no insurance I'd have thought they would do any scrutiny required