Renew Credit Hire Agreement pending no fault claim settlement?

larachantie

After an insured driver drove into our parked car, we naively let our insurance company use their own claims management arm to handle the claim and provide a car whilst being repaired.  They are technically separate companies but share much the same name.  We stupidly signed the hire and storage agreement in a rush and only then realised that their business model is to make money out of the hire and storage rather than settling the repair claim quickly.  The agreement is for three months but as long as we co-operated and stayed with them they would waive our liability for hire and storage claims if their claim (in my name) failed.

The car itself only had a dented and bent rear bumper but was declared a non structural write off and unroadworthy as one of the five attachments to the body had broken so could in theory fall off in motion.  We are happy with the repair settlement offered by the at fault insurer and have elected to take the car back (and repair it ourselves if necessary).  At this point things have dragged.  Despite accepting the at fault insurer valuation (only £500 less than our company) three weeks ago, the payment has not been made and our company is saying that these things take time.

Pending payment, we have asked them to return our car (by transporter) and collect the hire car at the same time.  They refuse, saying that the car can only be returned once the car valuation is paid, as otherwise we would be accepting that that we could afford to repair the car ourselves, thus negating the claim.  This is frustrating, as we suspect the car is really roadworthy and can be fixed quickly if necessary. 

Anyway, the hire and storage agreement we signed was only for there months.  I’ve read the contract closely (this time!) and I can’t see anything that ties us to renewing it.  So my question is – obviously without seeing the contract – does anyone have any advice on renewing it?  Can we wait for the payment but meanwhile state that we insist on collecting our car and returning the hire car before expiry of the original contract but we will of course co-operate with their claim for the three month period?  The main issue is that I do not want to give them any scope to make us liable for the hire and storage rates in the contract, which are now approaching five figures.

I suppose the obvious flaw is that our claims company will say that as the agreement has ended, the settlement for the car negotiated but not yet paid has lapsed as well?  I would then have to go back to my insurer and claim via them.  Which I should have done in the first place...

DullGreyGuy

To be honest, would need to read the wording around the 3 months and what happens after that period. Despite dealing with thousands of credit hire cases (defending our insureds who've had an accident that was potentially their fault) I dont ever recall anything coming up about the credit agreement having a fixed duration. 

As you say, as long as you support their recovery efforts then you have no liability but the longer the hire goes on the more chance they'll need your support to recover their full outlay. 

larachantie

DullGreyGuy said:

To be honest, would need to read the wording around the 3 months and what happens after that period. Despite dealing with thousands of credit hire cases (defending our insureds who've had an accident that was potentially their fault) I dont ever recall anything coming up about the credit agreement having a fixed duration. 

As you say, as long as you support their recovery efforts then you have no liability but the longer the hire goes on the more chance they'll need your support to recover their full outlay. 

Thanks, good advice. 

At the risk of going off-thread a bit, I'm curious as to why the "at fault insurer" has not paid yet when - according to my claims management company / credit hire company - we accepted their car valuation three weeks ago.  They know that a big hire car and storage bill is looming so why not pay the settlement cost quickly to cut down the size of the hire car and storage claim?  Even if they end up paying only a fraction of the (inflated) claim, surely acting quickly reduces their exposure?  Or is my company telling porkies by saying the delay is at the "at fault" insurer end?

DullGreyGuy

larachantie said:

DullGreyGuy said:

To be honest, would need to read the wording around the 3 months and what happens after that period. Despite dealing with thousands of credit hire cases (defending our insureds who've had an accident that was potentially their fault) I dont ever recall anything coming up about the credit agreement having a fixed duration. 

As you say, as long as you support their recovery efforts then you have no liability but the longer the hire goes on the more chance they'll need your support to recover their full outlay. 

Thanks, good advice. 

At the risk of going off-thread a bit, I'm curious as to why the "at fault insurer" has not paid yet when - according to my claims management company / credit hire company - we accepted their car valuation three weeks ago.  They know that a big hire car and storage bill is looming so why not pay the settlement cost quickly to cut down the size of the hire car and storage claim?  Even if they end up paying only a fraction of the (inflated) claim, surely acting quickly reduces their exposure?  Or is my company telling porkies by saying the delay is at the "at fault" insurer end?

The one thing you can say for sure, the credit hire company wont be chasing hard to get the monies paid to you. As you say, the longer the hire goes the more money they get. 

Its hard to guess, in defence work for an insurer you need to check three things 

• Indemnity - is the policy in good order, does it cover this claim
• Liability - is our insured responsible for the losses
• Quantum - do we agree how much the third party is claiming

These things are independent and so we could for example look at liability and quantum whilst we are still trying to establish if the person who was driving our vehicle but not named on the policy was insured elsewhere or not. Whilst we progress with all three, potentially at different paces, it's only when all three are ticked that we settle. 


You also have just delays due to operational constraints... its easy for things to fall between the cracks where the case handler raises a payment request as the last job before going on holiday, their manager reviews it and spots an error so declines it, the handler comes back from holiday with 200 overdue diary events to clear, payment request responses etc plus taking incoming calls so takes time to clear the backlog and/or possible to miss something in the rush to clear. Its then basically waiting for the next diary event to trigger to remind them to go in and check progress at which point they spot the declined payment (or it comes up on a list of open claims with no future diary dates which some poor person has to work through to decide if they should be setting a diary date or if the file should be closed etc)