Car insurance claim rejected

Sarah4407

My partner owned a Subaru for 6 years restored it and put it on the road, a month after it was targeted and set on fire (petrol bomb) the car insurance obviously done it's inspection and voided the insurance and claim as my partner had not declared it had previously been white (he painted it black) it was changed with the DVLA and insured as black. They claim this is a modification but in there t&c modifications state something that alters the performance and the paint doesn't so it wasn't declared. We have had the final decision and intende to start complaint with ombudsman but I am wondering if I should hire a lawyer to fight it or accept he made a error and is at fault. The insurance claim the paint(standard black ) made the car a target for theft but there was no evidence of theft just a petrol bomb throwing at the bonet. Any help would be great

tacpot12

If the T&Cs are clear that "a modification" is something that changes the performance of the car, then changing the colour is not a modification. You should check all the standard documents from the insurer to see if "a modification" is defined differently or "modified" is mentioned anywhere without defining what is meant. Repainting the car is a modification in normal parlance, but the insurer is being more reasonable than most if they have defined a modification as (only) being a change that affects the performance.

As the car was insured as a black car, it doesn't seem reasonable that the insurer can argue that it caused them not to be able to assess the risk adequately. However, I think that insurers are allowed to use any information that seems to indicate a difference in risk if they have data to back it up. So for example, they can decide that anyone born on a Monday will pay a higher premium if they have evidence that people born on a Monday have a statistically significant number of accidents more than everyone else. This is why most insurers ask about modifications; because people who modify their cars tend to make more claims and/or the claims are for a higher value.  This is where you might benefit from a legal opinion from a solicitor who knows the industry, to see whether they need to have evidence that repainting a car changes the risk profile, or can they just decide what you need to tell them in order for them to assess the risk.

Sandtree

Who did you buy the policy from and through which channel did you get the quote (ie over the phone, on their website, via confused.com)?

Modifications typically are anything done to the vehicle post manufacture that takes it away from the specification as it rolled off the factory line but exact definitions do vary by insurer (Admiral want any changes from standard spec irrespective if pre or post production).

I suspect from what you are saying the T&Cs are a red herring as these only apply to modifications you make after purchasing the policy (or application to modification declared before buying the policy in a claims situation) and instead what you need to be looking at is the questions (and help notes if online) that were asked at the time of purchase.  Its odd that you say you declared the colour when buying the insurance, its not normally a question, but you state you declared it as black which would suggest the mod was pre-purchase.

The first step in dealing with errors in buying insurance is to determine if the false declaration was either 1) Intentional/ gross negligent or 2) a mistake. Broadly speaking if the insurer can demonstrate you intentionally or through gross negligence  made false declaration they have strong grounds to void the policy and avoid any claims. If it is deemed that the false declaration was accidental or innocent then it opens up a whole decision tree on if the insurer would have insured you had you made the declaration and what impact it would have had on premium if they would have insured you.

Sarah4407

Thank you for your replies the insurance is with kitsune, the car was painted a few years ago and was put back on the road 2020 when taking out the insurance it asks about non standard paintwork and was done online. The insurance company says it wouldn't have offered cover if it was declared but they also says they wouldn't insure it if it was declared a import and we proved that it was declared a import and they did insure it. I can't seem to find what they do and don't actually insure and they don't seem to know themselves either so I don't know how to prove if they would have offered insurance. They collected the car in September took it to London done there inspection looked at values then shipped it bk to Scotland and then had a second inspection which I suspect is because of the value.

dunstonh

We have had the final decision and intende to start complaint with ombudsman but I am wondering if I should hire a lawyer to fight it or accept he made a error and is at fault. 

If you start legal action, which will cost you, then you lose access to the ombudsman.    Use the FOS first.

Sandtree

Sarah4407 said:

Thank you for your replies the insurance is with kitsune,

Kitsune is an MGA and don't do direct sales as far as I know, who is the company you bought from? My guess is Brightside who run the MGA but they may have different distribution deals.  As an MGA they are a middleman in the process, the level of authority delegated to MGAs by the insurer varies significantly and it could be that mods have to be referred to the insurer hence them "not knowing" as you put it.

dunstonh said:

We have had the final decision and intende to start complaint with ombudsman but I am wondering if I should hire a lawyer to fight it or accept he made a error and is at fault. 

If you start legal action, which will cost you, then you lose access to the ombudsman.    Use the FOS first.

I must admit I assumed it was a question of hiring a lawyer to deal with the Ombudsman, its not common but certainly seen it before when high values are involved.

Sarah4407

Thank you I will use fos, honestly don't think we have a chance at a win. They claim it was attempted theft but there is no evidence of theft and the colour attracted thieves but it was standard black. Would trying to prove there was no attempt of theft help, while the car was on fire my partner had to unlock the drivers door so he could push the car bk away from other cars and the house the windows where all intact too so I don't know where theft has come from as I didn't think thieves carried petrol bombs.

Sarah4407

We got a quote from mustard then it was directed to autonet which then ended with kitsune. I honestly don't know the workings of insurance. It has went from being voided due to it being an import to now colour, they had about 6 reasons they can't payout but they all got cleared and now only paint work stands. The car has a £9000 value from there inspection. 

Sandtree

As you havent answered the question I will assume that you bought it from Brightside. Today if you go to their site:

1) It doesnt ask the colour of the vehicle, nor does it present the colour of the vehicle as they are told from the DVLA but they will have that info 

2) It asks:

Has your car been modified in any other way?

If you or any of the previous owners have changed or added anything to the car since it was made, please answer yes to this question.

If you're unsure if your car's been modified, check its previous history to find out.

Why do we need to know about this?

Modifications can increase the amount an insurer has to pay out in the event of a claim, so it's important that they understand if your car has been modified since it was made.

The answer to this question was clearly yes as there is no reference to them only being interested in performance enhancing changes (assuming it hasnt changed recently but the ahove is the industry norm for many years). 

So, why did your partner declare no? Your argument is going to have to focus on why you stated no when clearly you knew you had modified the colour of the vehicle which therefore moves into the territory of intentional or negligent non-disclosure.

You may want to read the ombudsman guide on non-disclosure Misrepresentation and non-disclosure (financial-ombudsman.org.uk)

Sarah4407

Sandtree thank you for your replies, the insurance come from mustard then autonet and ended with kitsune. It was changed with DVLA to black. This has been a honest mistake he has the thinking due to it being a standard black and declared with DVLA it would be a black car. Can it be proved they would have insured the car if it was declared 

Ditzy_Mitzy

I'm sorry to hear about what's happened to the Subaru, must have been tough on your OH having his hard work destroyed.  Some people.  
As has been said, the FOS is the logical first port of call as the complaint hasn't got you anywhere.  There's nothing to stop you referring to a solicitor afterwards, if you don't like the ombudsman decision.  
The case itself is an odd one.  The insurer knew the car was black at the point the policy was written, so the fact of the car being black does not appear to adversely affect the policy.  Much is made, by the insurer, about the car previously being white.  The factory painted it that colour, so white is 'manufacturer trim' in strict terms.  The black respray, therefore, constitutes a deviation from the manufacturer trim of that car.  Cars come in different colours.  Was that Subaru, model and trim, available from the factory in black? 
If so, and if the car in question was repainted in OEM specification black paint, I'd examine the 'modifications' clauses carefully.  If it talks of deviation from manufacturer specification; does it mean 'any manufacturer spec for Subaru X'?  It would probably have to, as it's fairly easy to argue that it's impossible to maintain a car exactly as it left the factory.  There is no such thing as universal factory specification: cars of the same model, trim and year aren't necessarily identical.  Lots of manufacturers use third parts components; sometimes it's a lottery as to which of these are fitted.  Occasionally cars will end up with weird extra options and non-standard bits fitted.  
For the sake of simplicity, the modification clause is more likely to state 'deviation from manufacturer spec of Subaru X', in generic terms.  If it does, and manufacturer specification for Subaru X could include black paint, I feel the insurance company's argument is weak.  
Finally: did OH insure the car prior to the restoration?  If so, was it the same company?  If it was, the insurer would have known about the colour change in advance.