Item Recovered After Insurance Claim

[Deleted User]

Hi all,

It's not what you think, I'm not asking for justification to keep the insured item after it's been returned! Quite the opposite actually, I've been shafted after doing the decent thing!

Anyway, I lost an expensive phone last year and purchased a replacement at my own cost a few days later. Realised a couple of weeks later that I was covered under my insurance and made a claim which was approved.

The amount paid out was about £100 less than the cost of replacement but at the time I figured it was much better than nothing. So all was now well with the world...

A couple of weeks after the insurance paid out, TfL emailed me to say that my lost phone had been handed in and that I could go collect it. I did what I thought was the right thing and called the insurance company to tell them, expecting that I'd just send them the old phone and that would be that.

Unfortunately they're now saying that I have to repay them the money and the chap on the phone mentioned this was in the T&Cs. I've looked through them and don't see this written anywhere so I've asked for something in writing which I'm now waiting for.

So, I guess my question is... can they do this? My understanding of insurance was that once a claim is settled, ownership of the lost/stolen item passes to the insurance company. If I pay them back the money then I'm effectively worse off than I was if I never got the phone back as there's no way I can sell it for as much as it cost me to replace.

Seems a little unfair but I guess maybe that's the way it's supposed to work. Anyone happen to have been in a similar situation?

forgotmyname

Your new phone may not be worth what you paid, But you got your old phone back which is worth more than they paid you?

I would have assumed, probably the same as your the phone is now theirs and not yours.

[Deleted User]

Yes, to clarify:

'Old' phone was £720

Replacement was £620 (bought a cheaper one as I wasn't aware of insurance cover at this point)

Payout was £500 (maximum for a single item on the policy)

So, as things stand, the loss only left me £120 out of pocket. If I repay the £500, I'll be £620 out of pocket less whatever I can sell the old one for - £300 perhaps.

I'm not trying to pull a fast one and keep both phones, I'm perfectly willing to send them the old one as I believed it is now their property. They've said I have to repay the money though. Surely there must be precedent for this - I imagine a certain amount of lost/stolen property is recovered/handed in after an insurance settlement.

rs65

Lazyloki wrote: »

Unfortunately they're now saying that I have to repay them the money and the chap on the phone mentioned this was in the T&Cs. I've looked through them and don't see this written anywhere so I've asked for something in writing which I'm now waiting for.

In my experience they are wrong. The recovered phone now belongs to them (they may agree to sell it to you for salvage costs though). I would love to see the T&C that mentions this.

Aretnap

Who is the insurer?

[Deleted User]

The claim actually fell under travel insurance packaged with a credit card. It's underwritten by AXA.

TSx

Make a formal complaint - they are treating you unfairly. I'd be interested to see the terms they are relying on...

The returned phone now belongs to them and is theirs to do what they want with.

If you still have no joy, take it to the financial ombudsman who will rule in your favour (I'm 99% certain but they do make some odd decisions sometimes!).

[Deleted User]

Thanks for the advice. I'll wait and see what they come up with in writing as I only had the phone conversation with them today.

As to the T&Cs, I've looked through them and can find no mention of property that is returned after a claim is settled - just all the usual exclusions that would prevent a claim in the first place.

I'd understand if they'd caught me out trying to keep both phones (or to sell the one that was lost which I'm sure must happen a lot) but I'm a little miffed that I've done the right thing and seem to be penalised for it. I'd have been better off telling TfL to keep the bloody thing!

Enterprise_1701C

Putting it simply, the insurance company bought the interest in the phone when they paid out the money, therefore the phone is now theirs.

I am wondering if they think you have done something wrong, did they give any hint of this?

Have you only spoken to one person at the Insurance company? Could have been that this person did not know what they were talking about!

InsideInsurance

As others have said, they own the old phone now. Unless there are explicit terms in the policy to say the claim has to be cancelled then the phone gets sent to them and job done.

Sometimes insurers will give you the option of keeping the old item and returning the settlement as (a) there may be sentimental connection to the original and (b) the insurer really doesnt want the secondhand phone

Do you have a link to an online version of the terms?

[Deleted User]

Enterprise_1701C wrote: »

I am wondering if they think you have done something wrong, did they give any hint of this?

Have you only spoken to one person at the Insurance company? Could have been that this person did not know what they were talking about!

Not at all, they emailed me today to thank me for my honesty...and then went on to provide their bank details and address for a money transfer/cheque!

The email made no reference to any terms (which I had asked for) and was from a different person than who I spoke to yesterday.