Please help! Insurance nightmare.

ruthiebaby30

Hi,
A couple of years ago my daughter decided it would be a good idea to get insured on her friends car. She used Admiral and told them that it wasn't her car etc. Within a month her friend was involved in a RTA and the police were passing and got involved. Her "friend" when asked for her insurance details quoted my daughters name and address.
The first thing my daughter knew of this is when Admiral called her at work to ask her if she had been injured. Obviously she had no idea what they were talking about so Admiral immediately cancelled the policy. It turns out that the friend had no insurance of her own and I don't even think she had passed her test. But the other party involved in the accident insurance company still pursued a claim. As I said the police were involved and there was a case number. The other party made statement and described the appearance of the girl passing herself off as my daughter. These descriptions did not match, and my daughter was in work at that time in the afternoon and she has her bosses and co workers statements as well as CCTV to prove it.
Admiral sent a form for my daughter to sign accepting legal responsibility so they could represent her (even though they had already cancelled the policy) A solicitor advised her not to sign as he knew that she's would be saddled with the costs. Admiral have sent her about 3 or 4 letters asking for nearly £20,000 for costs! She has rarely got £20. She has always co-operated with them telling then the name and address of the ex friend and the case number etc.
Today, a representative agent came to the door asking for her. She left home about 18 months ago and is in a another friends house share. There's no way on earth she can afford this, and is she really liable?
Please help a very worried mother!

FlameCloud

There are two separate issues you need to consider here- the avoidance of the policy and Admirals legal ability to recover the money.

Taking the recovery aspect firstly. In taking out a motor insurance policy, the insurers of the vehicle become liable for third party costs for innocent third parties under s151 of the RTA. Whilst there are avenues that Admiral could take to avoid a liability under this section, this is invariably long winded (involving getting a court to avoid the policy) and largely pointless because of an ABI agreement which will still force them to settle third party claims.

The policy will almost certainly have a clause that will allow Admiral to pursue their insured (your daughter) should they be forced to make a payment under the RTA / ABI agreement that they ordinarily wouldn't have had to do. So, as such, there is a debt that they have a contract which says they can pursue against your daughter.

However, you need to look at the first issue- why was the policy cancelled in the first place, as this would be the only reason for Admiral to pursue your daughter. Are you certain they were made aware that your daughter was neither the registered owner nor owner of the vehicle? Have they given a specific reason for avoiding the policy in the first place?

If you can come back with why this was the case we could suggest whether this was fair, but if the avoidance was fair and accurate, sadly your daughter will likely be responsible for the costs.

ruthiebaby30

Hello,

Thanks for your reply. Admiral were totally aware that my daughter was not the registered keeper of the car. If my memory serves it was acknowledged in the policy that the car was kept at the other girls address. Admiral immediately cancelled the policy as soon as they realised that my daughter had not been the driver as she had no idea what they were talking about during the phone conversation after the accident.
It seems extraordinary to me that anyone can accident and give anyones name and then just get off scot free to let an innocent person get the fall out?

FlameCloud

You need to get the specific reason from them- if they knew that she wasn't the registered keeper (note- do they know she wasn't the owner, as this can be different) there would be no reason to cancel the policy. Did your daughter contest the decision to cancel the policy at the time?

I suspect there is something your daughter is likely not telling you about the cancellation if she did contest it.

It maybe worth her calling Admiral- given the amount of letters has she simply ignored this issue? If you call, ask to make a formal complaint if they won't put the reasons for the cancellation in writing.

dacouch

Who was covered to drive under the Admiral policy?

Who paid the premium?

What does her friend have to say about the matter?

Have you told the police about the friend's involvement?

ruthiebaby30

Admiral knew that she's wasn't the owner or the keeper but they still insured her and yes the police were aware of the whole story.
Admiral cancelled the policy when she was speaking to them on the phone. She didn't ask why she just assumed that its was because the friend was trying to make a fraudulent claim.
They haven't given (to my knowledge) a reason for the cancellation of the policy. The first thing we heard after the accident was that the guy involved in the crash was pursuing a claim with them and that they wanted my daughter to sign a form so that Admiral would act on her behalf legally. We contacted a solicitor who advised he not to sign as she would be admitting liability.
She has not ignored them, she has co-operated with them, she has told them the case numbers and address of the girl driving.
The friendship with the girl ended then, after many phone calls to her and her mother no one would speak to my daughter. When the girl had her car towed from the scene of the accident she had it destroyed straight away.

FlameCloud

The advice from the solicitor appears erroneous- a letter asking to sign so that Admiral can act on her own behalf is so that they can directly defend the claim - insurers can accept liability in any event.

Without knowing the reasons why the policy was declined, there really isnt a lot that you or us can do to help. She will need to phone them as quickly as she can and get them to detail the specific reasons. Without challenging the cancellation, it will stand and they will keep pursueing her for the money.

dacouch

It would help if you answer my earlier questions along with the following.

Why did your daughter want to be on the Insurance? (What benefit was it to her)

Why did your daughter decide / was persuaded to be the policyholder of her friends car? and what reasons did her friend give as to why the insurance should be in her name?

Who was covered to drive the car?

ruthiebaby30

Dacouch,
My daughter wanted to be insured on her friends car so she could drive it too. My daughter had her own policy on this car, it was not in the friends name. Her friend said that she had her own insurance for her car already (she had been driving around in it for months before my daughter got involved) On the Admiral insurance policy only my daughter was insured and only my daughter paid the premium.
It turns out that my daughter was the ONLY insured driver for the car and that was the reason that the friend lied to the guy she hit.

Quentin

When they cancelled, your daughter should have got some correspondence confirming everything????

Presumably they also stated what was happening to the premium (wanting it paying up in full, or stating their intentions about any refund following their cancellation), whatever your daughter wouldn't have been happy about either the cancellation or the loss of the premium!

Yet she doesn't seem to have challenged all this??

As others say, maybe there is more to this than your daughter has told you (though, of course it is her business (and problem) rather than yours and she may not want to discuss it with you)

dacouch

It would be highly unusual for an Insurer to accept a customer who did not own or was the registered keeper of a vehicle they wanted to insure.

Are you certain that your daughter correctly declared the car did not belong to her or was registered to her?