Are Write-Offs (Total Loss Vehicles) Appropriated Lawfully

System

Hi

My total loss vehicle is in a breakers yard in Thame, I believe.

I "negotiated" a higher amount than originally offered, but still short of buying a replacement vehicle.

I asked about the value at a franchised dealer for a trade in, and it seems they use the same "Glass's Guide". Therefore I am about the same for a total loss as a trade in.

My insurer did mention I could have the car back, but an 8 year old car, with the back door cut off, seats cut about and roof cut off doesn't seem worth the cost of moving it anywhere.

Upsetting as it all is emotionally, I have a replacement car and memories.

AAnd yes, I would have liked the money to buy a replacement, which was double the original offer, but wouldn't want the higher premiums associated with this (or the GAP offered by the franchised dealer).

8 years higher premiums against the 'depreciation' means I accept the lower premiums and hope to avoid a total loss situation.

paddyjoe26

The insurance industry expresses the view that their moral objective is to return the consumers to their original position experienced pre-accident (or loss). Some participants in this forum have expressed the view that the settlement payment of market value indemnifies the policyholder for the total loss vehicle.

Consequently it is argued that the insurer has the right to take possession of the vehicle, without taking cognizance of the fact that their are other losses facing the total loss claimant. I have queried the validity of this argument in my posting on 27 July '15. In the unlikely event that the insurance industry decides to grant pro-rata refunds and avoids withdrawing courtesy cars from total loss claimants, the claimant would still remain with the risk of being negatively impacted by the valuations. There is no possible way of removing this risk, except by extra insurance cover for the risk, which is not practical.

It is definitely not a certainty that the policy holder will be enriched, therefore a blanket appropriation cannot be justified. The insurers only way to best satisfy the policyholders fair and reasonable expectation to be fully reimbursed, is for the insurers themselves to find a replacement car acceptable to the policy holder. The remaining period of the current policy could then be transferred directly to the replacement, and the courtesy car should remain a provision of the policy for both ordinary and total loss claimants alike.

This would also take the risk of negative valuations away from the policy holder, leaving the responsibility with the insurer to accomplish a fair and acceptable replacement.

Quentin

paddyjoe26 wrote: »

The insurers only way to best satisfy the policyholders fair and reasonable expectation to be fully reimbursed, is for the insurers themselves to find a replacement car acceptable to the policy holder.......

Someone already thought that one up.

See Direct Line (not a recommendation) "used car replacement".

paddyjoe26

Quentin wrote: »

Someone already thought that one up.

See Direct Line (not a recommendation) "used car replacement".

Privilege insurance is one among many who offer a replacement in addition to the cash settlement, but who decides on the final option? Of course, if it is the policyholder's choice this is meaningful, however, it does not appear to be up the policyholder in most cases. direct line is apparently a noticeable and welcome exception.

The privilege contract states: We will decide to replace or pay a cheque.

All contracts I have seen contain a similar proviso, with the exception of direct line.

rs65

Direct Line and Privilege are the same group.

paddyjoe26

Having had their reimbursement argument for appropriating total loss vehicles scuppered, these are two of the questions the FCA and the CMA have refused to answer:

1) What contractual factors provide for a lawful transfer of the total loss vehicle to the insurer?
2) Why is it considered necessary and legitimate for the FCA remit to ignore general laws in the assessment of fairness of words in a contract term?

The FOS and the ABI can be included, for refusing to answer question 1
Why is the plain truth being withheld from policyholders and the wider public? Clearly, a reasonable conclusion is that the appropriations are unlawful. What else?

paddyjoe26

rs65 wrote: »

Why does there have to be a law?

I rediscovered this unusual question a few minutes ago, which reminded me that the FCA apparently shares this view. This is an unbelievable position for a regulator to hold, but this is what it has written in this regard:

"The UCTT (Unfair Contract Terms Team) considered that you were asking them for a detailed legal analysis of the term that you referred to them. This is beyond the FCA's statutory remit under the Regulations, as their role is not to assess the meaning of individual words beyond the assessment of fairness"

The Director of General Insurance and Protection (FCA) weighed in with this explanation (three years later):
"The UTCCR's are directed at the fairness of the terms themselves and not whether those terms are lawful under the general law."

I venture to conclude that the Director is disingenuously attempting to deflect the treachery of the FCA's remit, onto the Unfair Terms in Consumer Contracts Regulations (UTCCR's) themselves. How is it possible to distill out the innate presence of the law from a word or term without perverting the essential meaning of that word or term? For instance:

The man murdered the girl by strangling her. Take the law out of the word 'murdered' and one is left with 'killed'. Take the law out of 'killed' and what is left? The man held her in his arms?

No doubt, this remit was not a mistake.

paddyjoe26

The statutory powers granted to the FCA as a qualifying body to regulate and enforce the Unfair Terms in Consumer Contracts Regulations 1999, are circumscribed by a statutory remit which precludes the recognition of any general laws. (Refer to my post on 18th August 2015).

In practice, then, what are the consequences of this devious remit?

One: According to the FCA, the transfer of ownership of the total loss vehicle under the UTCCR's is solely predicated on the cash settlement fully reimbursing the total loss claimant. This premise is purported to be protected by the remit, but it has been compellingly demonstrated that the reimbursement narrative is too unreliable to justify a blanket appropriation of total loss vehicles.

Two: The Sale of Goods Act 1979 requires the payment of an agreed consideration, usually money, to satisfy a lawful transfer of property. The remit trumps this general law on property transfers by simply ignoring it.

Three: The Theft Act 1978 provides that anyone presuming ownership on a property (total loss vehicle) with the intention of permanently withholding the property from the owner will be guilty of an unlawful appropriation.
The FCA remit does not take any notice of this law.

Four: Human Rights Act 1998: article one of the First Protocol states that 'every natural or legal person is entitled to the peaceful enjoyment of this possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.'
The FCA remit also ignores this act.

In my view, the FCA remit is providing the insurers carte blanche to unlawfully appropriate over 500 000 total loss vehicles each year.

One of the main factors sustaining this devious and unfair practice, is the unfortunate fact demonstrated in numerous experiments by neuro-scientists in recent years, that our brains vigorously resist accepting information which conflicts with our existing beliefs and preconceptions. (New Scientist). Clearly this phenomenon affects the Establishment and insurance industry, as much as it does civil society.

paddyjoe26

Unless the FCA is remit is re-drafted regarding the exclusion from the assessment of fairness, the total loss vehicles will continue to be appropriated in violation of these existing laws, with the tacit encouragement of the FCA remit.

Total loss claimants who want to retain a repairable category C total loss must really insist on it. Direct a stubborn insurer rejecting your request to: https://assets.digital.cabinet-office.gov.uk/media/5329dec5ed915d0e5d00029f/provisional_findings_report.pdf for an analysis of vehicle write offs. paragraph 3.92 (b) on page 72/73 states: "if the policy holder chooses to retain the vehicle, they will receive a payment of the agreed pre-accident value of the vehicle less the estimated salvage value"

It is clearly the policyholders option to retain the vehicle. It is noteworthy that categories A and B have not been excluded for those with the knowledge and capacity to retain the salvage. It will be extremely difficult to retain categories A and B as the vast majority of insurers have signed up to the ABI's Code of Practice for the Disposal of Motor Vehicle Salvage, which requires these categories to be crushed once suitable spares have been salvaged. However, this agreement is between the insurer and the ABI. It does not bind the policyholder through the contract and neither is it a statutory requirement by the DVLA.

paddyjoe26

"You state that your view is that there is a difference between a cash settlement for damage to the car and a cash settlement for the car itself. In our view, this distinction should not affect the consumer who will receive an overall sum in settlement of their claim." (Unfair Contract Terms Team: UCTT/FCA)

This is absurd. Of course there is a significant difference in outcome depending on whether the damage or the vehicle, is the subject of the insurance. The FCA has the luxury to hold this view, because it is the only option the remit allows it to entertain. As discussed in an earlier posting, the remit totally disregards general laws, leaving Regulation 5(1) as the arbiter of the fairness of contract term.

A term will be considered unfair if: "Contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations under the contract, to the detriment of the consumer."

Clearly it is contrary to the requirement of good faith for the contract to promise to indemnify the cost of damage, regardless of whether or not it is repairable, and then to follow this accepted liability with the following, or similar, term:

"Once we settle your claim the car belongs to us"

This is nonsense. When the damage is repaired, the car is returned without the insurer claiming any stake in the vehicle. If the damage is not repaired the insurer claims a 100% stake. Why? On what grounds of logic, good faith, law or consistent process is this demand based? The FCA, the insurers and their lackeys, base this demand on a blatant lie that 'market value is paid for the vehicle' and in addition, based on another distortion of the truth, that the policyholder will be better off post accident if the vehicle is retained. The policyholder is, therefore, a clear victim of an imbalance in the rights and obligations under the contract. The term claiming ownership should be declared void, making the appropriation unlawful.