Insurance Voided After Accident

DullGreyGuy

deckz said:

DullGreyGuy said:

There are options... in most cases:

1. The company buys the car
2. The car is registered to the company
3. The company insures the car given it is their asset

Would the term for this be company car insurance, vehicle car insurance, or fleet insurance?

DullGreyGuy said:

You can do:
1. The company buys the car
2. The car is registered to the company or to you
3. You insure the car but make sure you correctly declare the owner and registered keeper

I would most likely go for this option, with car purchased by the company, but registered to my name and personal address on the V5C logbook.

When you mention I need to "correctly declare the owner and registered keeper":
Declare Owner - From what I recall, whilst declaring the owner, I was only able to select "company", I was not able to type further details such as business name and address. Is this enough to declare that the vehicle is owned by a company?
Declare Registered Keeper - Does that mean simply applying for the insurance using my own name and address?



Also, I did start a claim with the insurers who voided me.
However, because the insurance has been voided, nothing was actually claimed.
In this scenario, when applying for insurance for my next vehicle, do I declare a claim was made?
And I'm aware I need to declare that insurance is voided.

You will simply need to answer the questions honestly and accurately... if you declare a company is the owner and they dont ask for details of the company then that's both fine and what I'd expect.

Insurance typically is considered to divide customers into three "lines"... personal, commercial/business and corporate. As it's a company asset it would be normal practice for it to be insured on a commercial motor policy rather than personal lines. You could argue Corporate is just a subset of Commercial but there are a range of options open when you're a £100m company that dont exist for your sole trader trades person etc. 

Insurers as about claims or incidents, claimed for or not. So technically as the policy was void it should be declared as an incident rather than a claim however due to poor systems used by insurers and brokers it'll likely have gone into CUE as a claim (not that the difference between the two is major)

deckz

Hi all,

Apologies for the bump, if I should make a new thread please instruct 

A quick update on my situation: Before selling the car due to financial constraints, I lodged a complaint with my insurers. They've now taken 8 weeks to respond, suggesting that if I'm not satisfied with their decision, I can escalate the matter to the Financial Ombudsman Service.

I completely recognise and admit my oversight in this situation. It was indeed a lapse on my part, but it was an honest error. The prospect of having a voided policy on my record for a lifetime over a genuine mistake seems incredibly severe.

I want to stress that my primary goal here isn't financial, my main objective is to clear my name from the policy voidance if possible.

I am very new to this, so I would like to ask if any of you have experience or insight into whether approaching the Financial Ombudsman Service might be beneficial in this regard? Are there any potential risks or downsides to pursuing this further?

Your thoughts and advice would be greatly appreciated.

Many thanks.

DullGreyGuy

What did their final response to your complaint say?

The legislation in question is known by its acronym of CIDRE it says for an incorrect disclosure:

Intentional or Reckless - void policy, avoid all claims, keep premiums

Careless - cancel policy if you wouldnt have insured had the right information be given, avoid all future claims or if you would have insured had the right information been given, reduce all future claims by the percentage the premium was underpaid -v- what the quote would have been with accurate information. 

Some insurers are more generous and allow the insured to pay the premium shortfall and then cover claims in full.


If their final response says they'd have never insured you then I struggle to see what grounds you have to complain. If they say you were reckless or they believe it was intentional then you have an opening to try and argue why it was just careless rather than reckless. 

At the end of the day the FOS costs you nothing and so there is little harm in attempting to get a change even if it's just a slim chance. 

deckz

DullGreyGuy said:

What did their final response to your complaint say?

The legislation in question is known by its acronym of CIDRE it says for an incorrect disclosure:

Intentional or Reckless - void policy, avoid all claims, keep premiums

Careless - cancel policy if you wouldnt have insured had the right information be given, avoid all future claims or if you would have insured had the right information been given, reduce all future claims by the percentage the premium was underpaid -v- what the quote would have been with accurate information. 

Some insurers are more generous and allow the insured to pay the premium shortfall and then cover claims in full.


If their final response says they'd have never insured you then I struggle to see what grounds you have to complain. If they say you were reckless or they believe it was intentional then you have an opening to try and argue why it was just careless rather than reckless. 

At the end of the day the FOS costs you nothing and so there is little harm in attempting to get a change even if it's just a slim chance. 

Hi DullGreyGuy,

Firstly, I really appreciate your help with my situation on my different threads. You have assisted me a lot throughout this stressful period.

In regard to their Complaint Response, they never addressed anything from my complaint, they simply said sorry for the delay and that they would "get back in touch shortly".

I will provide their Voidance Notice, my Complaint and their Complaint Response (not final, I assume, based on their wording).


1. VOIDANCE NOTICE

We’re voiding your policy from the start date; XX XXXXXX 2023 This means that you haven’t been insured by us and you’ll need to find cover with another insurer.

It also means that no payments will be made regarding the incident dated XX XXXXX 2023.

This is because, during our routine checks, we found that you are not the registered keeper of vehicle registration XXXXXXX (Car Model). This was different from the information you gave us when you bought your policy.

Had we been aware you were not the registered keeper of the vehicle we wouldn’t have been able to offer you a quotation, nor issue you a policy.

For your information: 

• Now your policy is voided, there will be no cover for you or anybody else under this policy even if you still have the Certificate of Motor Insurance.
• Your car will no longer show as being insured by First Alternative. Once your policy is voided, you’ll need to get cover for your car elsewhere as it’s an offence to use your car or let it stand on a public highway without insurance.
• No other reminders will be sent to you regarding the voidance.
• You’ll need to declare this voidance to future insurers.
• We’ll refund the premium you’ve paid from the date your policy has been made void.

esure Insurance Limited underwrites policies under the name of esure, Sheilas’ Wheels and First Alternative. Unfortunately, we won’t be able to offer you insurance from any of these brands in the future.

2. MY COMPLAINT

Dear Xx Xxxx,

I hope this message finds you well. I am writing to appeal the recent decision to void my policy from the start date, XX XXXXXX 2023, as per your letter dated XX XXXXX 2023. I firmly believe that this decision was made in error, and I would appreciate your consideration in revisiting this case.

As the director of XXXXXXXXX Ltd, the vehicle in question was purchased under the company name, and the V5C was issued in the company's name during the registration process at the dealership. The intention was always for the vehicle to be under my personal use, with me as the registered keeper. This is reflected in the insurance policy, which I took out under my personal name and address, believing it to be accurate and aligned with the intended use of the vehicle.

Upon receiving your voidance notice, I realised the discrepancy between the V5C Registered Keeper and the policyholder details. To rectify this, I immediately amended the V5C details, transferring the Registered Keeper to my personal name and address, dated back to the date of purchase, reflecting the genuine and accurate situation.

The insurer's voidance notice states that, "Had we been aware you were not the registered keeper of the vehicle we wouldn’t have been able to offer you a quotation, nor issue you a policy." However, given that the V5C is now correctly registered under my name and address, and has been dated back to the date of purchase, the grounds for voiding the policy appear to be resolved.

I must stress that any discrepancy was an honest mistake, not a deliberate attempt to misrepresent my circumstances. I have been driving for 15 years with no prior incidents, and I have always maintained appropriate and accurate insurance coverage for my vehicles.

Given these circumstances, I kindly ask that you review the decision to void my policy and consider the possibility of reinstating it, as the discrepancy that led to the voidance has been rectified and was due to an honest misunderstanding, not wilful misrepresentation.

Thank you for your understanding and attention to this matter. I am hopeful that we can reach a fair resolution.

Yours sincerely,

XXXXX

3. THEIR COMPLAINT RESPONSE

Following on from my previous correspondence, I’m not yet in a position to respond to the concerns you have raised.

I’m sorry for the delay, I hope to respond in full shortly. However, if there is any further delay you will be kept informed.

As it’s now been 8 weeks since you first complained, I need to let you know that you have the right to refer your complaint to the Financial Ombudsman Service, free of charge – but you must do so within six months of the date of this email.

If you do not refer your complaint in time, the Ombudsman will not have our permission to consider your complaint and so will only be able to do so in very limited circumstances. For example, if the Ombudsman believes that the delay was as a result of exceptional circumstances. I’ve included a link their leaflet for your information.

DullGreyGuy

The more bites at the cherry you get the more chance of getting a favourable outcome. 

If it were me, I'd be giving them more time to produce their final response and just be mindful of the 6 month deadline (it really shouldn't take close to half of that for them to come to a decision) as you'll want to refer it prior to being time barred

As mentioned previously, single director companies have to have a rigid and thorough understanding that they and the company are separate entities and you cannot casually mix the two up. Your not the only one to do it but have seen the consequences for others when giant tax bills come in which they cannot afford

dunstonh

As it’s now been 8 weeks since you first complained, I need to let you know that you have the right to refer your complaint to the Financial Ombudsman Service, free of charge – but you must do so within six months of the date of this email.

They appear to have made a mistake.  The 6 month count starts from the date of the final response. 

At 8 weeks, they should either issue a final response (with the 6 month warning) or a response explaining that they not able to make a final response yet, give reasons for the delay and when they expect to be able to provide that final response.

So, they should not be issuing a 6 month deadline warning yet.     They have written this as if is a final response letter.   However, the fact they have means you should not ignore it as you dont want a problem later.   

Normally, I would agree with giving them a bit longer but the fact they have written the response using final response text means I believe you should go to the FOS now.   It gets you registered with the FOS within the deadline whatever happens next.

deckz

Thank you both for your replies.

With the information you both pointed out in mind, I will go ahead and initiate contact with the FOS

Just a few questions before I proceed.

1. I have made a slight mistake in my complaint.
I mentioned I am "the director" of the company. However, I should have written I am "a director" of the company (there are 3 directors including myself). Would this discrepancy be an issue down the line?

2. Whilst I was writing the Complaint, the car was still in the repair shop garage - ready to be repaired. But because I was incurring daily storage fees, I had to sell the car as it was - I could not simply wait for them to reply and open a case only to hope I could win the case. Would this change in circumstances affect my case with the FOS?
Right now, I simply want to clear my name with the voidance record that would stick with me for life. Anything financial would be a bonus (if FOS does side with me).

3. If I do happen to win the case - since the car is sold, how would remuneration be calculated?

4. I want to have some insight into what the actual process with the FOS is for a case like mine. Would there be a lot of back and forth with the FOS with myself and/or my company?

5. Are there any risks from my side? Any chance this could go to court?

Much appreciated.

DullGreyGuy

1) No, its irrelevant

2) Be clear what outcome you want

3) Assuming it was a total loss then the difference between pre accident value and what you got for it plus storage. If it was economical to repair it then its more complex but probably the lesser of repair estimate and the gap in sale price and pre-accident value  and then storage on top

4) No, you present your complaint. FOS may have a conversation with you. File goes to the counterparty and they respond. The Adjudicator writes their draft response and gives both you and the insurer the option to respond to the draft. The Adjudicator then writes their final response and asks both of you if you accept it or not.

If either party doesn't accept it then the matter is escalated to an Ombudsman who basically repeats the process however the final response only goes to you to ask if you agree... their decision is binding on an insurer and so the insurer cannot object to it. If you dont accept it your next step is court.

5) No risk from your side in this scenario. In principle, say you were arguing over the value of a vehicle instead, the Ombudsman could rule the original offer from the insurer was actually too generous and that they could settle it for less than what they have offered but in practice that doesn't happen. 

The only way it can end in court is either if 1) you lose the case after the ombudsman but you want to keep chasing it or 2) the insurer fails to enact the decision of the ombudsman. Both are purely your choice if to go that route and for option 2 its a simple process where the court simply orders the insurer to follow the decision, its not a case of having to argue the whole thing from the start gain... the law makes the ombudsman's decision binding on the insurer hence the court doesn't have to opine on it.

deckz

Thanks DGG,

Your replies have been fantastic. I hope people in a similar circumstance will find this thread - yours, as well as others, replies would help them a lot.

In response to point 3, I will disclose some information about the vehicle.
The vehicle was purchased for £92k in December 2022. The garage sent me a repair bill of at least £48k - it would require stripping for the full price of repairs. Stripping would mean the car requires a full repair before it can be reassembled, something I was not prepared to go ahead with. However, I do believe that the garage was overcharging by a mile (they were a high-end specialist repairer).

In the end, I sold the car in the crashed state, for £26k.

In regards to the value of the car before the crash, I believe it would have been approximately £80k, however, it could be argued that this is a high-demand vehicle and is also in a discontinued colour - would these facts come into play for me?

Given the circumstances presented above and from your experience, if I were to win the case, how would you believe this would play out for me?

Many thanks.

Wonka_2

deckz said:

In response to point 3, I will disclose some information about the vehicle.
The vehicle was purchased for £92k in December 2022. The garage sent me a repair bill of at least £48k - it would require stripping for the full price of repairs. Stripping would mean the car requires a full repair before it can be reassembled, something I was not prepared to go ahead with. However, I do believe that the garage was overcharging by a mile (they were a high-end specialist repairer).

In the end, I sold the car in the crashed state, for £26k.

In regards to the value of the car before the crash, I believe it would have been approximately £80k, however, it could be argued that this is a high-demand vehicle and is also in a discontinued colour - would these facts come into play for me?

Whhooaaa there - although it shouldn't have a bearing on the process from a claims point of view we're 2 months/4 pages in and we're talking about a claim on a nigh on £100k vehicle - there's no wonder an insurer might want to play hardball on something like this.

I've re-read the thread and can't see any reference (probably for good reason to protect identity) on what the vehicle was, the nature of the 'business' and your relationship as 'a' rather than 'the' director. - all of which are likely to be relevant.

Before going to court are you absolutely clean on all other elements and they've not found something re the business ownership/operation/use of vehicles that leads them to think they've a good case