Help! Car insurance wants money back for total loss made

Greg89

I received a total loss payment in march and then another one in mid may 

The one in may resulted in a £1.8k payment

They said it's my final payment with the claim, ref number 

I received a email today saying the may payment was made incorrectly and they are looking for their money back by the end of August otherwise they will instruct a solicitor

I'm not sure who's fault is this, if they want a repayment, surely they can consider a monthly repayment plan? So I can provide the money back 

I'll contact them and I can pay this off via a monthly repayment plan, what if they don't consider that?

DullGreyGuy

So you made two claims and received two payments or you made one claim and received the expected payment and then a second obvious duplicate? Presumably you put the money aside if you knew it was an obvious error?

As its their error they may consider a reasonable repayment plan but if it obviously wasnt intended for you they may be less amenable to offers than if there is a justified reason you legitimately thought it was for you and hence why you spent it.  

Greg89

A higher second payment which they clarified its final payment, email and on phone they said final payment 

turnitround

So was the first payment less than you expected? What did that one say?

Edit, I thought I remembered a previous post so just looked back. They offered, and you accepted, the payment in March as final so why would you get another payment in May. Did you query it at the time?

Greg89

I thought it an additional payment, they did not query it, on email and on the phone they just said I'm entitled to that amount

Surely they have to consider a payment plan

Brie

I received a email today saying the may payment was made incorrectly and they are looking for their money back by the end of August otherwise they will instruct a solicitor

Is the email actually from the correct company and not a scammer?  I'd check that first contacting them via some other source, email found on internet etc rather than responding directly to their email.

And you're saying that the overpayment was £1,800 total?  Given that instructing a solicitor is costly (£200+ an hour) what they actually mean is "we're going to pass this to Bob in our legal team who has no training in law per se but has a process to follow to threaten and intimidate you."   

Yes they will certainly accept a monthly repayment plan.  First step is for you to contact them (by post or by a legitimate email, NOT by phone) and state you can't pay it all immediately but are willing to come to an agreement.  Then work out your budget and see what you think is possible without causing you too much financial stress.  The next step would be to go back to them and say "because this is your error I believe you should take some responsibility for your actions and reduce the amount owed by XX%.  If you are willing to do this I am willing to pay £XXX a month over the next X years."

And then see what they have to say.  You may need to repeat the process a couple of times.  

Greg89

They stated they may need a solicitor to recover the costs and the payment may go up 

DullGreyGuy

Brie said:

Given that instructing a solicitor is costly (£200+ an hour) what they actually mean is "we're going to pass this to Bob in our legal team who has no training in law per se but has a process to follow to threaten and intimidate you."   

Insurers hire many lawyers internally (last client had over 200) plus spend many millions on external counsel and so get rates reflective of the volume of business they buy; they wouldnt be paying £200+hr for a lawyer to write debt recovery letters even from fully qualified solicitors

sourcrates

Greg89 said:

They stated they may need a solicitor to recover the costs and the payment may go up 

You only need pay solicitors costs if it goes to court, otherwise tell them you refuse to pay any costs for their mistake.

Collection letters always threaten worst case scenario, they are likely computer generated, much like debt collection letters we see on here all the time, nothing special.

Brie (above) gives you quite comprehensive instructions in what you should do.

Tell them, the error was theirs, not yours, and you will repay what you owe at an affordable rate, and at your own convenience, do not be intimidated by them, if anything I would be annoyed at the threatening tone of the letter, and I would say so as well.

You do not offer them a payment plan, you inform them that is what they will be accepting.

They are not alone in being able to write snotty letters.

DullGreyGuy

sourcrates said:

Greg89 said:

They stated they may need a solicitor to recover the costs and the payment may go up 

You only need pay solicitors costs if it goes to court, otherwise tell them you refuse to pay any costs for their mistake.

Remember this is being conducted under a contract of insurance and as such it may include clauses about covering costs in certain circumstances. 

Even if it doesnt allow them to recover costs it almost certainly will allow them to cancel the policy if the insured isnt compliant which will be a life long declaration on all future insurance. 

I agree a reasonable insurer will allow repayment terms but they have more tools to deal with an unreasonable customer than some other companies. Once had a policyholder offer to repay the £30,000 they owed us at £1 per week, didnt accept. 

sourcrates

The OP doesn't state whether the policy is still live or not, if the car was a total loss, it`s possible the policy has ended now, maybe the OP could clarify that point.

There may be a clause in the policy which states we can recover reasonable costs, if we mess up, it would depend what they call reasonable if it was their error.

If the policy is still live, then I would maybe turn down the rhetoric a little, I just despise the fact if the OP is a current customer, they go straight to a collection letter with a vague threat of legal action, as a first response rather than as a last resort.