Car Insurance Pay Out - who decides value?

kaMelo

TELLIT01 said:

In my opinion, insurers should be responsible for sourcing a vehicle matching the original as closely as possible.  After all they are the ones with the buying power.  Unfortunately I don't see that happening as it's too much trouble for them as they continually get away with low-balling.

They would also be inundated with complaints about the cars they sourced because this or that fault developed, possibly years later, it would be a complete nightmare for them. With the exception of "new for old" in relation to new cars written off within the first twelve months it is always the customers who source a replacement car.

The other important take here is always claim via your own insurance company, let them fight your case with the third party rather than you.

Aretnap

TELLIT01 said:

In my opinion, insurers should be responsible for sourcing a vehicle matching the original as closely as possible.  After all they are the ones with the buying power.  Unfortunately I don't see that happening as it's too much trouble for them as they continually get away with low-balling.

That sounds like a recipe for endless threads on here from people complaining that they've been ripped off because their insure has sourced a car which is a slightly different model/trim/has a slightly higher mileage/has a different brand of tyres/is a different colour to their original one.

And it would be completely unworkable for rare/classic cars where an exact or even close replacement might not be for sale at any given time, or might not even exist.

And that's before we get onto what happens when the replacement car incurs a hefty repair bill after a few months, which is obviously the insurer's fault for buying a substandard car. Unlike the customer's old car which was definitely perfect in every way, had no parts which were close to wearing out and would never have broken down or needed any maintenance again at any point in the future, ever.

Plus many if not most people whose cars are written off don't want or need an exact replacement anyway - they will take the opportunity to upgrade to something newer.

Also, insurance company claims departments would have to employ hundreds of people to go scouring through AutoTrader and liasing with dealerships up and down the country trying to source new cars, rather than just a bloke who looks up the value in the trade guides.the cost of all those extra staff would inevitably be passed onto... the consumer. Given most people choose insurance on price alone, few or no insurance companies are going to switch to a model which pushes up their prices for all customers and only provides a (dubious) benefit to the small fraction who have their cars written off each year.

But apart from that, it would work very well.

[Deleted User]

MadEddieffs said:

I realise that now but the settlement figure would mean asking dealers/private sellers knock off about £600 or 20% of the asking price. I very much doubt that will happen. Suppose the settlement paid to me was even less. Then what would I do?

Then you can show them proof that it's not enough. Get the best offer in writing and email it to them.

TELLIT01

Aretnap said:

TELLIT01 said:

In my opinion, insurers should be responsible for sourcing a vehicle matching the original as closely as possible.  After all they are the ones with the buying power.  Unfortunately I don't see that happening as it's too much trouble for them as they continually get away with low-balling.

That sounds like a recipe for endless threads on here from people complaining that they've been ripped off

They are being ripped of with the current system.  I'd love to know how many people actually receive a payment high enough to get a true like for like replacement of a written off car.

400ixl

TELLIT01 said:

They are being ripped of with the current system.  I'd love to know how many people actually receive a payment high enough to get a true like for like replacement of a written off car.

The vast majority do.

Not saying any of the below applies to the OP as it is impossible to know without ever having seen the car in question.

To start with many people believe their car is in much better condition than it is, or that all of those optional extras increase they value more than they do, or it is a unique vehicle and therefore the guides don't cover it.

Usually people who claim the final valuation (noting that low balling first offers does happen) isn't market value are ones who live in regions where prices have always been higher and are not looking further afield. The pricing given is on a national basis, not regional and is based on the guide price for buying from retail outfit with minimum legal warranty (or remainder of manufacturers), at the price they sell at, not go on the forecourt for.

If the rip off was rife and you intimate then there would be a lot more noise about it. Not been directly involved for a while now, but it was certainly a case then that of the complaints in deadlock (which were in the low single digits) only a low percentage of those were not actually unrealistic expectations. It does happen that insurers get it wrong and can be hard (if not impossible) to get them to shift if they do even through appeal to the ombudsman.

If you want to get a guaranteed payment then either a) get an agreed value policy b) take out gap insurance.

Smithcom

TELLIT01 said:

In my opinion, insurers should be responsible for sourcing a vehicle matching the original as closely as possible.  After all they are the ones with the buying power.  Unfortunately I don't see that happening as it's too much trouble for them as they continually get away with low-balling.

I think that you may misunderstand the role of a motor insurer.   As soon as they start going down this road, they would need to open all kinds of facilities to deal with repairs/deliveries/problems etc.  One 2nd hand car differs massively from another 2nd hand car, and a customer may have specific requirements.

Also, not sure how an insurer would have have buying power in respect of a 2nd hand car, unless via a garage/trader. 

That said, insurers should definitely be making fair settlement offers, to allow policyholders to facilitate a suitable replacement vehicle.

In this specific case, in trying to resolve the matter, the OP has unfortunately made a poor decision by allowing the 3rd party insurer to deal with the claim, and losing their complaints access to the FOS.

SC

[Deleted User]

400ixl said:

TELLIT01 said:

They are being ripped of with the current system.  I'd love to know how many people actually receive a payment high enough to get a true like for like replacement of a written off car.

The vast majority do.

Not saying any of the below applies to the OP as it is impossible to know without ever having seen the car in question.

To start with many people believe their car is in much better condition than it is, or that all of those optional extras increase they value more than they do, or it is a unique vehicle and therefore the guides don't cover it.

Usually people who claim the final valuation (noting that low balling first offers does happen) isn't market value are ones who live in regions where prices have always been higher and are not looking further afield. The pricing given is on a national basis, not regional and is based on the guide price for buying from retail outfit with minimum legal warranty (or remainder of manufacturers), at the price they sell at, not go on the forecourt for.

If the rip off was rife and you intimate then there would be a lot more noise about it. Not been directly involved for a while now, but it was certainly a case then that of the complaints in deadlock (which were in the low single digits) only a low percentage of those were not actually unrealistic expectations. It does happen that insurers get it wrong and can be hard (if not impossible) to get them to shift if they do even through appeal to the ombudsman.

If you want to get a guaranteed payment then either a) get an agreed value policy b) take out gap insurance.

Hopefully you can see the problem with this. Insurance is supposed to put you back in the position you were before the accident.

What actually happens is you end up with no car, probably needing to get a new one fast so you can go to work. You have to spend your time looking for a replacement, often at an awkward time and under pressure. You go from a vehicle you are confident in to one that is an unknown quantity with the legal minimum warranty.

Even if your car was nearly new and you have gap insurance, the wait for new cars is long and stock goes for over list price.

I don't think the insurance company sourcing the vehicle is the right solution, but just paying out a lump sum that's precisely calculated based on averages and buyers with more time available isn't right either.

DullGreyGuy

[Deleted User] said:

400ixl said:

TELLIT01 said:

They are being ripped of with the current system.  I'd love to know how many people actually receive a payment high enough to get a true like for like replacement of a written off car.

The vast majority do.

Not saying any of the below applies to the OP as it is impossible to know without ever having seen the car in question.

To start with many people believe their car is in much better condition than it is, or that all of those optional extras increase they value more than they do, or it is a unique vehicle and therefore the guides don't cover it.

Usually people who claim the final valuation (noting that low balling first offers does happen) isn't market value are ones who live in regions where prices have always been higher and are not looking further afield. The pricing given is on a national basis, not regional and is based on the guide price for buying from retail outfit with minimum legal warranty (or remainder of manufacturers), at the price they sell at, not go on the forecourt for.

If the rip off was rife and you intimate then there would be a lot more noise about it. Not been directly involved for a while now, but it was certainly a case then that of the complaints in deadlock (which were in the low single digits) only a low percentage of those were not actually unrealistic expectations. It does happen that insurers get it wrong and can be hard (if not impossible) to get them to shift if they do even through appeal to the ombudsman.

If you want to get a guaranteed payment then either a) get an agreed value policy b) take out gap insurance.

Hopefully you can see the problem with this. Insurance is supposed to put you back in the position you were before the accident.

What actually happens is you end up with no car, probably needing to get a new one fast so you can go to work. You have to spend your time looking for a replacement, often at an awkward time and under pressure. You go from a vehicle you are confident in to one that is an unknown quantity with the legal minimum warranty.

Even if your car was nearly new and you have gap insurance, the wait for new cars is long and stock goes for over list price.

I don't think the insurance company sourcing the vehicle is the right solution, but just paying out a lump sum that's precisely calculated based on averages and buyers with more time available isn't right either.

Its supposed to put you back in the same financial position you were before, not the same physical position. 

If you had a £10,000 car giving you a cheque for £10,000 achieves that. Same as those houses built near cliff edges that go over due to errosion... no one is ever going to suggest that the insurer should rebuild the cliff to be able to put a new house on the top of it again!

This is also part of my problem... why is every secondhand car ever involved in an accident mechanically perfect? "A car you had confidence in" is a very big assumption. I accept it was more of a known quantity but that knowledge may include that the clutch was on its last legs etc. 

Ultimately first party insurance doesnt have to be limited to indemnification... just look at home insurance and that most are "new for old" or RTI/RV GAP insurance. An insurance policy could exist which paid an extra £500 or 10% or whatever on total loss valuations if companies believed there was a market for it and that customers would pay the extra £25 per year premium to have it. Unfortunately personal lines insurance is a heavily commoditised distress purchase and the general experience is that customers will switch from a well known brand that they've had good experiences with to a total unknown to save less than £5 per year so the chances of them pay the extra £30 from that unknown brand is fairly slim.

[Deleted User]

DullGreyGuy said:

[Deleted User] said:

400ixl said:

TELLIT01 said:

They are being ripped of with the current system.  I'd love to know how many people actually receive a payment high enough to get a true like for like replacement of a written off car.

The vast majority do.

Not saying any of the below applies to the OP as it is impossible to know without ever having seen the car in question.

To start with many people believe their car is in much better condition than it is, or that all of those optional extras increase they value more than they do, or it is a unique vehicle and therefore the guides don't cover it.

Usually people who claim the final valuation (noting that low balling first offers does happen) isn't market value are ones who live in regions where prices have always been higher and are not looking further afield. The pricing given is on a national basis, not regional and is based on the guide price for buying from retail outfit with minimum legal warranty (or remainder of manufacturers), at the price they sell at, not go on the forecourt for.

If the rip off was rife and you intimate then there would be a lot more noise about it. Not been directly involved for a while now, but it was certainly a case then that of the complaints in deadlock (which were in the low single digits) only a low percentage of those were not actually unrealistic expectations. It does happen that insurers get it wrong and can be hard (if not impossible) to get them to shift if they do even through appeal to the ombudsman.

If you want to get a guaranteed payment then either a) get an agreed value policy b) take out gap insurance.

Hopefully you can see the problem with this. Insurance is supposed to put you back in the position you were before the accident.

What actually happens is you end up with no car, probably needing to get a new one fast so you can go to work. You have to spend your time looking for a replacement, often at an awkward time and under pressure. You go from a vehicle you are confident in to one that is an unknown quantity with the legal minimum warranty.

Even if your car was nearly new and you have gap insurance, the wait for new cars is long and stock goes for over list price.

I don't think the insurance company sourcing the vehicle is the right solution, but just paying out a lump sum that's precisely calculated based on averages and buyers with more time available isn't right either.

Its supposed to put you back in the same financial position you were before, not the same physical position. 

If you had a £10,000 car giving you a cheque for £10,000 achieves that. Same as those houses built near cliff edges that go over due to errosion... no one is ever going to suggest that the insurer should rebuild the cliff to be able to put a new house on the top of it again!

This is also part of my problem... why is every secondhand car ever involved in an accident mechanically perfect? "A car you had confidence in" is a very big assumption. I accept it was more of a known quantity but that knowledge may include that the clutch was on its last legs etc. 

Ultimately first party insurance doesnt have to be limited to indemnification... just look at home insurance and that most are "new for old" or RTI/RV GAP insurance. An insurance policy could exist which paid an extra £500 or 10% or whatever on total loss valuations if companies believed there was a market for it and that customers would pay the extra £25 per year premium to have it. Unfortunately personal lines insurance is a heavily commoditised distress purchase and the general experience is that customers will switch from a well known brand that they've had good experiences with to a total unknown to save less than £5 per year so the chances of them pay the extra £30 from that unknown brand is fairly slim.

This is only true if your time is worthless.

DullGreyGuy

[Deleted User] said:

DullGreyGuy said:

[Deleted User] said:

400ixl said:

TELLIT01 said:

They are being ripped of with the current system.  I'd love to know how many people actually receive a payment high enough to get a true like for like replacement of a written off car.

The vast majority do.

Not saying any of the below applies to the OP as it is impossible to know without ever having seen the car in question.

To start with many people believe their car is in much better condition than it is, or that all of those optional extras increase they value more than they do, or it is a unique vehicle and therefore the guides don't cover it.

Usually people who claim the final valuation (noting that low balling first offers does happen) isn't market value are ones who live in regions where prices have always been higher and are not looking further afield. The pricing given is on a national basis, not regional and is based on the guide price for buying from retail outfit with minimum legal warranty (or remainder of manufacturers), at the price they sell at, not go on the forecourt for.

If the rip off was rife and you intimate then there would be a lot more noise about it. Not been directly involved for a while now, but it was certainly a case then that of the complaints in deadlock (which were in the low single digits) only a low percentage of those were not actually unrealistic expectations. It does happen that insurers get it wrong and can be hard (if not impossible) to get them to shift if they do even through appeal to the ombudsman.

If you want to get a guaranteed payment then either a) get an agreed value policy b) take out gap insurance.

Hopefully you can see the problem with this. Insurance is supposed to put you back in the position you were before the accident.

What actually happens is you end up with no car, probably needing to get a new one fast so you can go to work. You have to spend your time looking for a replacement, often at an awkward time and under pressure. You go from a vehicle you are confident in to one that is an unknown quantity with the legal minimum warranty.

Even if your car was nearly new and you have gap insurance, the wait for new cars is long and stock goes for over list price.

I don't think the insurance company sourcing the vehicle is the right solution, but just paying out a lump sum that's precisely calculated based on averages and buyers with more time available isn't right either.

Its supposed to put you back in the same financial position you were before, not the same physical position. 

If you had a £10,000 car giving you a cheque for £10,000 achieves that. Same as those houses built near cliff edges that go over due to errosion... no one is ever going to suggest that the insurer should rebuild the cliff to be able to put a new house on the top of it again!

This is also part of my problem... why is every secondhand car ever involved in an accident mechanically perfect? "A car you had confidence in" is a very big assumption. I accept it was more of a known quantity but that knowledge may include that the clutch was on its last legs etc. 

Ultimately first party insurance doesnt have to be limited to indemnification... just look at home insurance and that most are "new for old" or RTI/RV GAP insurance. An insurance policy could exist which paid an extra £500 or 10% or whatever on total loss valuations if companies believed there was a market for it and that customers would pay the extra £25 per year premium to have it. Unfortunately personal lines insurance is a heavily commoditised distress purchase and the general experience is that customers will switch from a well known brand that they've had good experiences with to a total unknown to save less than £5 per year so the chances of them pay the extra £30 from that unknown brand is fairly slim.

This is only true if your time is worthless.

Not at all... you agree to uninsured losses when you take a policy out. Even if a car is repairable it will cost you time to take it to the garage or wait in for them to collect it. Your excess is an uninsured loss. Buy from Admiral Group and all optional extras are not insured (factory fit or post prod) and so are an uninsured loss if they are damaged in a claim or if a total loss. Your phone being used as a satnav is limited to £100 cover whereas most new phones are way above this. 

There is nothing that legally stops these things being insured just customers would rather save £10 a year on insurance and carry these risks (or more accurately they are probably ignorant of what risks they are taking when saving the £10 other than the excess). Ultimately there is a reason why people increasingly buy insurance that doesnt include Driving Other Cars and yet HNW Motor insurance not only provides DOC but gives fully comp cover on DOC rather than TPO, they provide a like for like replacement vehicle during repairs or total loss no matter how long etc... again a feature a basic policy could offer but one that most consider the market wont pay for.

HMW dont include a cover for your time, at least the few I've looked at, but again no reason they couldnt if they thought they'd get more sales despite the higher price