Accident on finance car

Lozza1998

Looking for some advice please - apologies this is my first time posting on here to bear with me!! 

One week ago, I was involved in a head-on collision that completely destroyed my car. Thankfully, I wasn’t injured — but financially, it’s a different story. The car was on finance, and at the time, I only had third party, fire, and theft insurance (a mistake I now regret), so the damage to my own vehicle wasn’t covered.

The insurance company has deemed me at fault. I don’t believe I’m fully responsible based on the damage to my car, but I accepted liability to avoid the stress of disputing it. What’s frustrating is that finance companies don’t clearly explain that you should have comprehensive insurance when signing the contract — which would have saved me from this situation.

The finance company has been very unhelpful. I was told that if I want to sell the car for spares or repairs, I’d need to settle the finance in full first. Alternatively, I have to provide evidence of repair costs (even though multiple garages have declared it a total loss) or get scrap quotes. The best scrap quote I’ve had is £150 — for a car that was worth around £7,000 before the crash.

If I go the scrap route, I still have to keep paying monthly on a car I no longer have. If I settle the finance early, I can use the lower settlement figure, so I’ve decided to take out a personal loan to do that and at least end the agreement on my terms. The car is currently listed on eBay and has received a few decent offers.

I’m just wondering if anyone else has been through something similar, and if there are any other options I might have missed? Obviously, this has been a tough (and expensive) lesson in the importance of fully comprehensive insurance — but it’s incredibly disheartening to be stuck paying for a car I no longer own for the next four years!

cw8825

If you don’t believe you’re fully responsible it is worth disputing. 

The other insurance company could be liable for some of your losses which will help 

every finance agreement I have had has stated the car needs to be insured comprehensively so your decision to not do so is strange and I would have thought the saving was not worth the risk 

What were the circumstances of the collision?

I would hold off on scrapping of selling the car yet. 

Paying off the finance is probably the best move then you can move on

Mildly_Miffed

Lozza1998 said:

Looking for some advice please - apologies this is my first time posting on here to bear with me!! 

One week ago, I was involved in a head-on collision that completely destroyed my car. Thankfully, I wasn’t injured — but financially, it’s a different story. The car was on finance, and at the time, I only had third party, fire, and theft insurance (a mistake I now regret), so the damage to my own vehicle wasn’t covered.

The insurance company has deemed me at fault. I don’t believe I’m fully responsible based on the damage to my car, but I accepted liability to avoid the stress of disputing it. What’s frustrating is that finance companies don’t clearly explain that you should have comprehensive insurance when signing the contract — which would have saved me from this situation.

The finance company has been very unhelpful. I was told that if I want to sell the car for spares or repairs, I’d need to settle the finance in full first. Alternatively, I have to provide evidence of repair costs (even though multiple garages have declared it a total loss) or get scrap quotes. The best scrap quote I’ve had is £150 — for a car that was worth around £7,000 before the crash.

If I go the scrap route, I still have to keep paying monthly on a car I no longer have. If I settle the finance early, I can use the lower settlement figure, so I’ve decided to take out a personal loan to do that and at least end the agreement on my terms. The car is currently listed on eBay and has received a few decent offers.

I’m just wondering if anyone else has been through something similar, and if there are any other options I might have missed? Obviously, this has been a tough (and expensive) lesson in the importance of fully comprehensive insurance — but it’s incredibly disheartening to be stuck paying for a car I no longer own for the next four years!

I'm really not quite sure how the "damage arising" helps to demonstrate or disprove liability in a head-on collision. Could you explain?

That aside, it may be too late to object, if you've already accepted liability.

1. You had possession of somebody else's car.
2. That car is now damaged beyond economic repair.
3. No insurer is paying for it.
4. You have agreed to the insurer that you were responsible for the damage.

I'm not quite sure why you think the bill will land on anybody else's plate but yours.

Yes, you owe the car's owner - the financier - the settlement value of the finance. And, yes, you need to keep paying the monthlies until such time as you can settle the finance. Nothing has changed with the finance - except that the financier can no longer repossess their car.

MattMattMattUK

I am not sure why you feel the finance company is unhelpful. You caused an at fault accident, you had failed to properly insure the car and now you seem to expect them to take the financial hit for that?

Also who only takes out 3rd party, fire and theft these days? When it comes up it seems to save a maximum of a few percent, often nothing and in some cases is actually more expensive than fully comprehensive.

DullGreyGuy

Lozza1998 said:

Looking for some advice please - apologies this is my first time posting on here to bear with me!! 

One week ago, I was involved in a head-on collision that completely destroyed my car. Thankfully, I wasn’t injured — but financially, it’s a different story. The car was on finance, and at the time, I only had third party, fire, and theft insurance (a mistake I now regret), so the damage to my own vehicle wasn’t covered.

The insurance company has deemed me at fault. I don’t believe I’m fully responsible based on the damage to my car, but I accepted liability to avoid the stress of disputing it. What’s frustrating is that finance companies don’t clearly explain that you should have comprehensive insurance when signing the contract — which would have saved me from this situation.

The finance company has been very unhelpful. I was told that if I want to sell the car for spares or repairs, I’d need to settle the finance in full first. Alternatively, I have to provide evidence of repair costs (even though multiple garages have declared it a total loss) or get scrap quotes. The best scrap quote I’ve had is £150 — for a car that was worth around £7,000 before the crash.

If I go the scrap route, I still have to keep paying monthly on a car I no longer have. If I settle the finance early, I can use the lower settlement figure, so I’ve decided to take out a personal loan to do that and at least end the agreement on my terms. The car is currently listed on eBay and has received a few decent offers.

I’m just wondering if anyone else has been through something similar, and if there are any other options I might have missed? Obviously, this has been a tough (and expensive) lesson in the importance of fully comprehensive insurance — but it’s incredibly disheartening to be stuck paying for a car I no longer own for the next four years!

Remember those terms and conditions you were asked to read and then had to sign your name next to confirming you agree to them all? Thats where it told you you needed Comp insurance. 

Comp is often cheaper than TPFT as well, due to negative selection and the typical person who chooses to buy it rather than Comp.

Not been through it but have known policyholders that have, you ultimately just need to pay off the finance and explore the cheapest ways of doing so

Aretnap

Ultimately car finance is just a form of loan. If you buy a car with a credit card or a bank loan and the car gets accidentally destroyed then the credit card bill or bank loan would still paying off. Indeed it's the same if you buy a TV, or a sofa, or anything else on credit - the bill still needs paying if it suffers an accident. If that's not a risk that you can afford to take, you need to insure the car/TV/sofa against damage.

Being TPFT means that damage to your car is not your insurer's responsibility, regardless of whose fault the accident was. Their only role is to deal with any claims against you that the third party makes (hence "third party").

If you think it was the other driver's fault (in whole or in part) then you could attempt to claim directly from his insurer, and your own insurer's view of who was at fault doesn't necessarily prevent you from doing this, though you shouldn't expect too much help from your own insurer, and if they've already admitted liability to the third party on your behalf it could complicate things.

DullGreyGuy

Aretnap said:

Ultimately car finance is just a form of loan. If you buy a car with a credit card or a bank loan and the car gets accidentally destroyed then the credit card bill or bank loan would still paying off. Indeed it's the same if you buy a TV, or a sofa, or anything else on credit - the bill still needs paying if it suffers an accident. If that's not a risk that you can afford to take, you need to insure the car/TV/sofa against damage.

There are differences because the finance is secured on the vehicle, hence had the OP had Comp insurance the total loss payment would have been made to the finance company not the OP whereas had they used a personal loan instead then the payment goes to the OP and its up to them if they use it to repay the loan or not. 

Aretnap said:
If you think it was the other driver's fault (in whole or in part) then you could attempt to claim directly from his insurer, and your own insurer's view of who was at fault doesn't necessarily prevent you from doing this, though you shouldn't expect too much help from your own insurer, and if they've already admitted liability to the third party on your behalf it could complicate things.

It needs to be more coordinated with their insurer, at present their insurer says they are going to concede liability in which case any TPI is just going to reject any claim made against them on the grounds of the OP has accepted to be liable via their insurer (who has the right to act on behalf of their insured). 

Their insurer won't help them recover their losses and won't get involved with liability unless approached by the third party but once approached they will deal with liability. Were they to get a not 100% fault liability settlement its at that point they then down tools again and the OP would be on their own to recover the proportion that the tP has been found liable. 

sheramber

Lozza1998 said:

Looking for some advice please - apologies this is my first time posting on here to bear with me!! 

One week ago, I was involved in a head-on collision that completely destroyed my car. Thankfully, I wasn’t injured — but financially, it’s a different story. The car was on finance, and at the time, I only had third party, fire, and theft insurance (a mistake I now regret), so the damage to my own vehicle wasn’t covered.

The insurance company has deemed me at fault. I don’t believe I’m fully responsible based on the damage to my car, but I accepted liability to avoid the stress of disputing it. What’s frustrating is that finance companies don’t clearly explain that you should have comprehensive insurance when signing the contract — which would have saved me from this situation.

The finance company has been very unhelpful. I was told that if I want to sell the car for spares or repairs, I’d need to settle the finance in full first. Alternatively, I have to provide evidence of repair costs (even though multiple garages have declared it a total loss) or get scrap quotes. The best scrap quote I’ve had is £150 — for a car that was worth around £7,000 before the crash.

If I go the scrap route, I still have to keep paying monthly on a car I no longer have. If I settle the finance early, I can use the lower settlement figure, so I’ve decided to take out a personal loan to do that and at least end the agreement on my terms. The car is currently listed on eBay and has received a few decent offers.

I’m just wondering if anyone else has been through something similar, and if there are any other options I might have missed? Obviously, this has been a tough (and expensive) lesson in the importance of fully comprehensive insurance — but it’s incredibly disheartening to be stuck paying for a car I no longer own for the next four years!

— but it’s incredibly disheartening to be stuck paying for a car I no longer own for the next four years!

who do you think  should pay fir it?

Grey_Critic

A head on collision - which side of the road were you on?