Car dealer indemnity insurance - why do I pay?

splinternet

I'm in the process of buying a 2 y.o. car from a car supermarket. On top of the price of the car, they are charging me £150 for "indemnity insurance". As far as I can tell, this is to protect the dealer (presumably for professional negligence?) rather than me; why am I having to pay for this? Does this insurance protect the dealer if I sue him (e.g. for false representation of the car, etc...?). Are there any circumstances where this insurance is of benefit to me? Could I claim against it, and if so, for what?

motorguy

splinternet wrote: »

I'm in the process of buying a 2 y.o. car from a car supermarket. On top of the price of the car, they are charging me £150 for "indemnity insurance". As far as I can tell, this is to protect the dealer (presumably for professional negligence?) rather than me; why am I having to pay for this? Does this insurance protect the dealer if I sue him (e.g. for false representation of the car, etc...?). Are there any circumstances where this insurance is of benefit to me? Could I claim against it, and if so, for what?

Its a con - tell them to !!!! off frankly its just to get extra profit out of you.

Ultimately they might "insist" then you're in to the realms of walking and going elsewhere or paying it, but personally i wouldnt pay it out of principle.

martinthebandit

motorguy wrote: »

Its a con - tell them to !!!! off frankly its just to get extra profit out of you.

Ultimately they might "insist" then you're in to the realms of walking and going elsewhere or paying it, but personally i wouldnt pay it out of principle.

......is the right answer.

It’s one of the reasons places like that can put a lower screen price on the cars they sell.

splinternet

Thanks for quick reply. I agreed to buy the car just over a week ago and paid £500 deposit. The car is having some minor repairs and then I'm due to pay the balance and pick it up sometime this week. If I "walk" now will I lose the deposit?

IamNotAllowedToUseMyName

splinternet wrote: »

Thanks for quick reply. I agreed to buy the car just over a week ago and paid £500 deposit. The car is having some minor repairs and then I'm due to pay the balance and pick it up sometime this week. If I "walk" now will I lose the deposit?

Your deposit is for buying the car, not so that you are obliged to pay spurious extras.

It sounds to me like a trading standards issue - if this is truly a compulsory extra then it should have been included in the screen price. What I would do is say that you are happy to conclude the deal excluding the extra charge which is an unreasonable term of contract. If it came to court, they would not be able to defend it.

What I would do is, assuming you are otherwise happy with the car, is say that you are not prepared to pay the extra charge, that it was not brought to your attention when the car was advertised. They have a choice, to conclude the deal at the proper agreed price excluding the extra charge, or they are in breach of contract and must refund you in full.

In the meantime, gather any screen prints and photographs that show that the extra charge is deceptively advertised, allowing them to show a lower screen price. It is easy (though tedious and slow) to make a complaint to ASA and Trading Standards but they will lose in a case like this.

What they are doing is PPI - remind them how well that ended for the banks.

splinternet

Response from dealer: "The indemnity insurance is to protect you to make sure that the history of the vehicle is guaranteed for as long you keep the car." I thought the dealer had to guarantee the history of the vehicle, and any discrepancy I uncover would protect him if I sue. Isn't guaranteeing the history all part & parcel of the "attraction" of buying from a dealer?

George_Michael

Reply to dealer.

"Thank you for the e-mail.(or letter)
When buying from a reputable dealership, indemnity insurance should not be required to protect me as the vehicle details and any history for that vehicle that is provided by the dealership is legally required to be both truthful and correct.

So by saying that I need to purchase indemnity insurance, you are in effect admitting that you cannot be classed as a reputable trader who abides by their legal obligations.
If you are admitting this, I do not feel it safe to complete the purchase and would be grateful if you could arrange for my deposit to be returned"

stator

Have you already signed a piece of paper agreeing to pay this fee?

If not then just refuse to pay it.

m0bov

If they feel the need to make punters pay for indemnity in case the car is a cut and shut, then obviously they have been caught out in the past. Get your deposit back and run for the hills!

System

I had this with Quicks. My response to the manager who was eventually brought out to deal with me when the salesman gave up was this:

"It is your responsibility as a car dealer to ensure that the car is actually the one it is supposed to be, you actually own the car that you're selling and that it isn't stolen. If it turns out it is then I'll be getting my money back because I bought it from a car dealer."

He then grunted something in response about not doing a PDI check if I wasn't going to pay their £99 buyer fee and I replied and said that was fine because if there were any faults they'd missed then I'd be bringing it back for them to fix so it was up to him whether he wanted to risk that or not.

Indemnity insurance is something you pay for when you buy from a car auction, not a dealership.

m0bov

Looks like they are trying to trade you the car!