Issue with Direct Line Car Insurance - Paid out to 3rd party without my consent

Tboffin
Tboffin Posts: 3
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edited 11 December 2023 at 10:04AM in Insurance & life assurance
Hi,

I hope someone knowledgable can give me some advice. In April I caused a minor scratch to a bumper when reversing. The 3rd party wasn't too fussed, and said he'd see if they can polish it out, but we swapped numbers and I took pictures. I reported this to Direct Line For Information Only, as is required by law. As my renewal was due 3 weeks later that went up by £200, but they said if no claim is made I'd get a refund.
I never heard from the 3rd party and I now phoned Direct Line to ask about the refund. It turns out that a claim was made and paid out, without them contacting me. I made a complaint, and they acknowledge that they ignored my instructions and actively contacted the third party "to mitigate costs", and did not attempt to contact me. They paid £2k for what was a minor scratch, never asking for my pictures. They concede they made an error and offered first £50, now £100 as compensation. But it's already cost me £200, and I will pay for this at each renewal for the next 5 years. If I had dealt with the 3rd party privately it would have probably been cheaper.

Do I take this further, have Direct Line done something I could take them to FCSA for? Do I hold out for more? Or do I cut my losses and take the offered compensation?

Thanks

Comments

  • BoGoF
    BoGoF Posts: 6,790
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    What makes you think they need your permission to pay a 3rd party? You say a claim was made (assuming by the 3rd party) and you had already admitted liability? What were the specific 'instructions' you gave them? All I'm seeing is you were told you'd get the £200 back if no claim was made but a claim was made?
  • Okell
    Okell Posts: 617
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    I think you'd be better off posting either here Insurance & life assurance — MoneySavingExpert Forum or here Motoring — MoneySavingExpert Forum

    Report your own post and ask a member of the site team to move it to the appropriate board.  (You'll likely get better advice)
  • DullGreyGuy
    DullGreyGuy Posts: 9,182
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    Motor, and employers liability, are the two forms of compulsory insurance and both the law and their policy wordings give them the right to deal with the third party's as they see fit. Were this not the case you could block a legitimate third party's right to compensation by being obnoxious and run up costs for the insurers when the TP finally gets a court order (the RTA requires insurers to settle court orders against their policyholders or vehicles insured by them)

    So strictly DL were perfectly entitled to payout the claim. So your only potential grounds for complaint is if they had said they would inform you before doing so and then failed to do so... you still couldn't have stopped them settling had they actually followed the instructions and so really £100 for not being told something was to happen when it was always going to happen doesn't sound too bad. 

    Not sure what you meant by FCSA but consumer complaints first have to be addressed to the insurance company and once you have their final response you are entitled to go to the Financial Ombudsman Service (FOS)
  • BoGoF said:
    What makes you think they need your permission to pay a 3rd party? You say a claim was made (assuming by the 3rd party) and you had already admitted liability? What were the specific 'instructions' you gave them? All I'm seeing is you were told you'd get the £200 back if no claim was made but a claim was made?
    Hi, thanks for posting. The issue is that the 3rd party did not make a claim, DL actively contacted them thereby encouraging them to claim. 
  • Motor, and employers liability, are the two forms of compulsory insurance and both the law and their policy wordings give them the right to deal with the third party's as they see fit. Were this not the case you could block a legitimate third party's right to compensation by being obnoxious and run up costs for the insurers when the TP finally gets a court order (the RTA requires insurers to settle court orders against their policyholders or vehicles insured by them)

    So strictly DL were perfectly entitled to payout the claim. So your only potential grounds for complaint is if they had said they would inform you before doing so and then failed to do so... you still couldn't have stopped them settling had they actually followed the instructions and so really £100 for not being told something was to happen when it was always going to happen doesn't sound too bad. 

    Not sure what you meant by FCSA but consumer complaints first have to be addressed to the insurance company and once you have their final response you are entitled to go to the Financial Ombudsman Service (FOS)
    Hi, thanks for replying. DL actively sought the 3rd party out, the 3rd party did not make a claim. I had told them I'd deal with it with the 3rd party. That's my complaint, apart from the possibly inflated claim for a small scratch. 
  • BoGoF
    BoGoF Posts: 6,790
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    edited 8 December 2023 at 12:38PM
    Tboffin said:
    BoGoF said:
    What makes you think they need your permission to pay a 3rd party? You say a claim was made (assuming by the 3rd party) and you had already admitted liability? What were the specific 'instructions' you gave them? All I'm seeing is you were told you'd get the £200 back if no claim was made but a claim was made?
    Hi, thanks for posting. The issue is that the 3rd party did not make a claim, DL actively contacted them thereby encouraging them to claim. 
    Ultimately they still claimed - whether prompted or unprompted is pretty irrelevant.

    My advice would be take the money and move on. I'm surprised they initially said the £200 extra premium would be refunded if no claim was made - the fact you had a bump makes you higher risk and the higher premium reflects that risk.
  • BoGoF said:
    Tboffin said:
    BoGoF said:
    What makes you think they need your permission to pay a 3rd party? You say a claim was made (assuming by the 3rd party) and you had already admitted liability? What were the specific 'instructions' you gave them? All I'm seeing is you were told you'd get the £200 back if no claim was made but a claim was made?
    Hi, thanks for posting. The issue is that the 3rd party did not make a claim, DL actively contacted them thereby encouraging them to claim. 
    Ultimately they still claimed - whether prompted or unprompted is pretty irrelevant.

    My advice would be take the money and move on. I'm surprised they initially said the £200 extra premium would be refunded if no claim was made - the fact you had a bump makes you higher risk and the higher premium reflects that risk.
    Could it be down to the NCB? NCB was reduced, but if there isn't a claim then it's restored?

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