Written off car payout query

Edgecrusher91

Hi

I'm not entirely how to explain the situation I'm in at the moment as I'm still trying to fully understand it myself, so that being the case please forgive the lack of correct terminology and somehat scattered wording of this thread. Hopefully this won't be too hard to follow. I could really do with some advice!


I was involved in a car crash on the 3rd of August. I have been found to be not at fault by my insurance company but as the other driver refused to give her insurance details to the police that attended the scene I was advised to start a claim on my insurance as I was told it would be a day or two until their insurance could be tracked down so I agreed.

I had already decided at the scene that my car was going to be a write off. The police, fire crew and my mechanic who recovered the car agreed with me so I had accepted that fixing it was not going to be an option. After the weekend it was confirmed by my insurance co that it was to be a write off ( category a ) and that I would receive a payout for it shortly. Fast forward to today having heard nothing regarding payout or progress.

I receive a call telling me that although they have contacted the other persons insurance and told them what happened the day after the crash they will not accept liability until they have spoken to their customer who is ignoring all phone calls and hadn't bothered reporting the accident to them so because of this it would have to be a claim on my insurance which would then be recouped later after liability had been accepted.

They then went on to tell me that a payout for my written off car was not viable as after deducting my excess which was £500 and the outstanding insurance payments for the rest of the year (I paid monthly and was just over 2 months into the policy so still owe £742) I would get £3.72!!! This renders it impossible for me to buy a like for like car which I thought was the whole point.

Although I was assured several times whilst on the phone that I would be able to claim all this back and more once liability has been accepted this doesnt help me one bit in the short term. Why should I be left in this situation when it wasn't my fault.

So my question is this...

Is this standard practice or am I being lied too?

If it is standard practice then is this something that happens all the time and is merely a formality of having to claim off my own insurance rather than the 3rd parties. I've searched high and low online and can find no other disgruntled people talking about this so it could be that I'm overreacting and just have to have a wait and see attitude and smile sweetly when the cheque for £3.72 turns up in the post.

Would just like to add I've not accepted anything as was completely disgusted with what I was being told and just wanted to get off the phone. They will supposedly be calling me tomorrow to try and finalise the claim in regards to the payout.

Any advice would be greatly appreciated as I'm at a total loss at what I'm supposed to do. Also if anymore info is needed please let me know and I will happily update.

One things for sure. I won't be sleeping tonight 😔

Thanks

forgotmyname

Thats the issue of having a high excess on a cheap car. Daughters excess is £5 more than the cars worth. But she wont be claiming from her own policy. Cheaper to fix it ourselves or replace it.

If not too late claim directly from the 3rd party, but that will take time.

Is the policy still active? If so it will cover your new car so your not losing that.

tripled

Essentially you have two options - claim off the 3rd party insurance or claim off your own comprehensive insurance. You don't need to use your insurer to claim off a 3rd party, indeed many insurers outsource it or refer you on to a claims management firm anyway.

A claims handler agrees liability for costs on your behalf. They may also negotiate payouts, refer you to car hire companies or personal injury lawyers and so on. If the other party accepts liability they may also front some costs. However, they don't actually pay out for the damage.

In your case you have nominated your insurer as the claims handler. Liability has not yet been accepted by the 3rd party. Your insurer or their agent will continue to persue this until they come to an agreement on liability between them and the 3rd party's insurance unless you tell them otherwise. However, in the mean time there is no payout forthcoming, leaving you the choice of waiting or claiming against your own comprehensive insurance.

Generally speaking, if you write a car off and claim against your comprehensive insurance, they will pay out of the vehicle value (less the excess), and terminate the policy. This usually involves returning any courtesy cars and a loss of your NCD, which will not be reinstated until the claim is settled.

My understanding is that most if not all of them do not refund any remaining term on the policy. Paying monthly does not affect this, i.e. you still owe any remaining premium (which they are deducting from the payout).

The good news is that all these costs are reclaimable from the 3rd party if they are found at fault. The bad news is that your insurer would then be acting for themselves and may only reclaim their direct losses, leaving you to reclaim any out of pocket expenses (loss of excess and policy term) from the 3rd party yourself.

Personally if liability is clear cut and there is no prospect of a meaningful payout from your comprehensive cover, in your shoes I wouldn't bother claiming aginst it. That leaves your choices being to leave them to thrash it out, engage your own claims handler or handle the claim against the 3rd party yourself. Either way, it could be a long drawn out process with you left out of pocket in the mean time. Sorry for the bad news

Just to add - you can claim reasonable expenses off the 3rd party. So if you really needed a car for the day (or week or month) you should be able to hire one and claim the cost back once they have agreed liability. However if liability is not agreed or your costs are excessive (e.g. hiring a limo to cart you around) you won't get those costs back.

Claims management firms may refer you to a "credit hire" company. They rent you a car much like any hire firm, except their rates are far more expensive and you don't have to pay up-front. Personally due to the risk of being landed with a massive bill if the 3rd party doesn't pay out, I would steer clear and just get a regular rental on my credit card. However, they are available as a last resort.

sheramber

We had a similar problem when the the other party ( a national chain) would not report the accident- their driver's fault- to their insurance company.

Fortunately, we had legal cover so it was dealt with by them and they ended up going to court to recover the costs. A warrant was issued against the company so i assume the costs were recovered.

Our excess was covered by an insurance policy that paid out when the case had not been settled after 12 months.

exiled_red

Insurance is a frustrating thing to deal with, it is standard practice that you pursue a claim through your insurance company and then two insurance companies determine who was at fault, and the insurance company of the driver who was at fault settles with your insurance company (assuming that they can make an agreement).

Regarding your payout, how much do you think it would cost to replace the car? It seems effectively that the insurance company value your car at £1245.72, and as you initially have to claim from your own insurance under the terms of your excess you are liable for the first £500, reducing their liability to £745.72. Presumably if you had paid your insurance premium for the year upfront your payout would have been £745.72 from your insurance company, as you pay monthly they are ensuring that they get what they would have been due and hence deducting this from your payment. If the other party's insurance admits liability then you should get the full valuation of your car from that insurance company and presumably your insurance company will be happy as you will continue to pay the premiums for the remainder of the year.

It make take a bit of time for all this to get sorted out as insurance companies look after their own interests before those of their customers.

Edgecrusher91

Thanks for the replies. Greatly appreciated.

I will try and address some info I left out earlier and answer the questions below.

First and foremost I have been given a hire car through my insurance which I now realise wasn't all that it was made out to be as I now run the risk of being stuck with the bill for if the 3rd parties insurer won't payout for whatever reason, which is why I'm keen to get rid of it as soon as possible to hopefully minimise the risk of that. Sadly this was the only option available to me as it being the middle of summer all the rental car places close by were fully booked and were unable to help so I didn't have much choice but to take it regardless of the risk. But with the pittance I'm going to receive for my car it leaves me for a week or two without the funds to find another car.

I do have legal cover so I have instructed them to begin the claim for my injuries and expenses! as much as I realise I should just let them deal with this, I can't help but get involved as all this liability business is really getting on my nerves seeing as I'm the only one who's going to be losing out for the time being. Almost feels like the guilty party are getting off Scot free and I'm left with the aggro.

As for their valuation for my written off car, that is where I get completely lost because I just can't figure out where they got that figure from. It's almost double what I'm seeing the same type of car going for on auto trader etc which is odd because after all I've read the last day or two has been how insurance companies screw you over on valuations. This one however is well above what I was expecting.

Which makes it even more annoying that I won't see much of it until this is settled. I won't be able to find a direct replacement as the car I had was slightly modified and if I'm correct one of the few left on the road in a good condition (I'm probably wrong on this but that's my reasoning for the high valuation) so will just have to settle for something else for now.

The 3rd parties insurance have contacted me, but because they took so long to do so the valuation had already been sorted by my insurance and they are unwilling to take over the claim as its gone too far now.

So am I right in saying I can just walk away from claiming off my insurance and leave the legal team to fight it or do I have to accept their offer and claim off my insurance. sorry about the stupid questions but As you can tell I'm like a deer caught in the headlights with all this and have no idea what I should be asking or where I stand sadly.

The reason for the high excess was because I'm young, haven't been driving long and my monthly premium on the car I had was pretty high and having a high excess was the only way to make it somewhat manageable. After this I've learnt my lesson and won't take that route in future.

With regards to whether the insurance policy is still active, I'm unsure as I'm being given conflicting information I think . I was told from the outset of this that when I get a new car from the payout (ha) I could add it to the old policy as it was still active but I received a letter telling me that because the car was written off the policy had been cancelled. It was one of the questions I was meant to ask but after the shock of the offer I was in rather a bad mood and forgot about it. I will definitely ask when I'm called next.

Hope this clears some things up.
Thanks again

System

When my car was written off "luckily" by a driver with the same insurance company so it was a painless process all in all my policy just continued. I was paid for the car but as it had no scrap value i was left with it to either fix or scrap.
I fixed it using a portion of the payout and everything has been fine .

sheramber

We were able to to continue to cover our new car on the same policy if we replaced it within one month from settling the write off pay out.

maddogb

The reason for your "high valuation" seems obvious, it would not be deemed good practice for them to value it lower and have to pursue you for the difference given your predicament
but I have to ask, why is it you agreed to a £500 excess and are paying £800pa to insure a car you only deemed to be worth £600 and even thought it a good idea to claim off your insurance.