Negotiating total loss payment

redpete

I recently had an accident and my car has been declared a total loss by the insurance company.

They have offered £14000, I've asked £14900. I bought the car new, limited edition Skoda Octavia VRS. Because so few were made to this spec it is impossible to find the 3-5 equivalent cars for sale with comparable mileage to judge if the value is reasonable. I can only find one exact match for sale and it has a very different mileage figure to mine.

I've used all the cars I can see advertised of that spec as a comparison (about 15 examples found online) - all are similar age as this edition was only sold for a few months. Specs are identical apart from est/hatch and manual/auto variations. I've used this to show how price varies with mileage, how it compares manual vs auto and how it compares estate vs hatch. I've also made an allowance for my fitting towbar and bluetooth.

They've just replied saying their valuation stands as they need "exact examples" to support any change.

I've asked them how they come up with their valuation in the absence of exact examples but in the meantime what would be the process if we do not come to an agreement?

It's AXA / Swiftcover if that makes any difference.

Geodark

redpete wrote: »

I recently had an accident and my car has been declared a total loss by the insurance company.

They have offered £14000, I've asked £14900. I bought the car new, limited edition Skoda Octavia VRS. Because so few were made to this spec it is impossible to find the 3-5 equivalent cars for sale with comparable mileage to judge if the value is reasonable. I can only find one exact match for sale and it has a very different mileage figure to mine.

I've used all the cars I can see advertised of that spec as a comparison (about 15 examples found online) - all are similar age as this edition was only sold for a few months. Specs are identical apart from est/hatch and manual/auto variations. I've used this to show how price varies with mileage, how it compares manual vs auto and how it compares estate vs hatch. I've also made an allowance for my fitting towbar and bluetooth.

They've just replied saying their valuation stands as they need "exact examples" to support any change.

I've asked them how they come up with their valuation in the absence of exact examples but in the meantime what would be the process if we do not come to an agreement?

It's AXA / Swiftcover if that makes any difference.

I could never understand this - what happens if it is ultra rare edition of a car, or a kit car, something like a Ferrari or even something that is built and finished to spec??? what on earth would they do then? really doesn't seem right does it!

arcon5

How old is it? How much at new? What mileage?
Any finance involved?

Hintza

Should probably have been insured for an agreed replacement value with a specialist insurer if it is as rare as the op suggests.

redpete

Bought new Oct 12, about £18500 IIRC, 42000 miles, no finance on it.

Gap insurance would have been useful in hindsight, but then I didn't intend writing it off ;-)

It's not Ferrari-value or -rarity by any means, but as an end of model special had really good spec and is a decent car, hence looking for like-for-like replacement.

arcon5

Assuming a 5 year finance agreement, I don't think GAP would be necessary here anyway would it? Being nearly 2 1/2 yrs in to the agreement you can't owe more than the level of payout they're looking at can you?

AdrianC

Geodark wrote: »

I could never understand this - what happens if it is ultra rare edition of a car, or a kit car, something like a Ferrari or even something that is built and finished to spec??? what on earth would they do then? really doesn't seem right does it!

You'd have it on an agreed value policy, so the value of the car would not be in dispute.

But a two year old Skoda? It's in the price guides. That's the figure they'll use.

redpete

arcon5 wrote: »

Assuming a 5 year finance agreement, I don't think GAP would be necessary here anyway would it? Being nearly 2 1/2 yrs in to the agreement you can't owe more than the level of payout they're looking at can you?

I did take a loan for part of the purchase price but mainly to get the extra discount and free 3-yr / 30k mile service plan - paid it off early and now nothing owing. The GAP would have been to cover some / all of the depreciation over the first few years.

redpete

AdrianC wrote: »

But a two year old Skoda? It's in the price guides. That's the figure they'll use.

From my check of Parkers the ins co is offering less than the dealer price and takes no account of the towbar and bluetooth that I had fitted.

AdrianC

redpete wrote: »

From my check of Parkers

They won't use Parkers. They'll use Glass's and other industry guides.

the ins co is offering less than the dealer price

Of course they will. If you buy from a dealer, you get a lot of legal protection, warranty and other benefits that you don't currently have. The private purchase price is a better equivalent.

and takes no account of the towbar and bluetooth that I had fitted.

Did you declare them as modifications on your policy? If not, you can't expect the insurer to take account of them.

bowlhead99

redpete wrote: »

Bought new Oct 12, about £18500 IIRC, 42000 miles, no finance on it.

Gap insurance would have been useful in hindsight, but then I didn't intend writing it off ;-)

It's not Ferrari-value or -rarity by any means, but as an end of model special had really good spec and is a decent car, hence looking for like-for-like replacement.

End of model specials basically get all the extras thrown on without having to pay quite as much in terms of new price, because they are having a last hurrah to get rid of them. If something has reached the end of the line and then they stop making them (and stop making the parts etc etc, and replace with a new better model) then that is not good for residuals unless you're talking a high value nice rarity that gets collectors status.

Though the vrs is a cracking little car, people like it because it's value for money which is part of the appeal. Cars that are famously value for money - rather than famous for being able to command an expensive price for being prestige and sexy - are not going to hold up as a high priced car once you've added 40k of wear to them. People buying sporty Octavias are looking for performance bargains, not to pay a lot of money.

If you bought at 18.5k and you now think it's worth almost 15k, thats depreciation of less than 20% over 40k miles and close to two and a half years ago. It was only a month into the '62 plate so almost a '12 and we have had '13, '63,'14,'64 in the time since then and in a few days will be on '15... Depreciation is not a straight line over five or ten or twenty years it is a steep curve that gets shallower. You bought at the steepest bit and did higher than average miles on it..

You can't say that a like for like replacement is buying freshly serviced and warrantied up at top dealer price, of a car that doesn't even exist in that spec and mileage in a dealer at the moment and assumes a conservative drop of only 20% over all that time and miles.

For a start, if it was listed in the dealer for £14900 you would not pay £14900 you would haggle like hell to get stuff thrown in and extended warranties and whatever they could give you to knock it down. If you sold it privately you would not get £15k for it just like if you were buying privately you wouldn't want to pay more than £14k for it. It's harsh but if you can't prove some direct comparables and didn't go for a guaranteed value policy or GAP, then you are likely stuffed.

The aftermarket towbar and bluetooth are specialist items that you want but another buyer might not want - so you won't recover anything like half the cost for them once they become second hand, and way way less if you paid full dealer prices to buy and fit.

Either they are popular addons and all the rival cars in the market will have them; or they are unpopular and because nobody sees the value in them. When buying second hand cars everyone compromises on their spec so although it might help you sell a car faster it can be shocking how little actual cash you receive for your choice of options. What did you tell the insurance company they were worth when declaring those extras last renewal?