MSE News: Car Insurers to pay £200m in compensation after short-changing 270,000 motorists

MSE_Sal

The FCA’s found some insurers underpaid claims on written-off or stolen cars. Around 270,000 drivers will share £200m – with nearly 150,000 already paid. If you’re due money, your insurer will contact you. You don’t need to do anything – just watch out for scams.

Read the full story:
Car written off or stolen? Insurers to pay £200m in compensation after short-changing 270,000 motorists

If you haven’t already, join the forum to reply.

Este365

Will the insurance company of the third party who was at fault contact me if there is a further payment due, as my car was considered a category N write off. My insurer was not involved.

brizzlegirl

We had a 14 yo car written off as not worth repairing (after minor dent on wing) about a year ago. We didn’t challenge the offer given at the time. Churchill was the insurer. Should I ask for evidence that it was a fair price and how they arrived at it or do you think their processes would have improved by August 2024? Thanks 

XRS200

brizzlegirl said:

We had a 14 yo car written off as not worth repairing (after minor dent on wing) about a year ago. We didn’t challenge the offer given at the time. Churchill was the insurer. Should I ask for evidence that it was a fair price and how they arrived at it or do you think their processes would have improved by August 2024? Thanks 

The article says if you're due compensation the insurer will contact you.

MyRealNameToo

Este365 said:

Will the insurance company of the third party who was at fault contact me if there is a further payment due, as my car was considered a category N write off. My insurer was not involved.

The review stems from Consumer Duty legislation which is between an insurer and its customers, it doesnt impact third parties. As such the scope of their investigations were likely to be limited to insurers total losing their clients vehicles not third parties - though there has been no definitive statement of scope that says if TPs were in or out. 

As a third party you have significantly lower protections, hence why you can use the Financial Ombudsman etc. 

brizzlegirl said:

We had a 14 yo car written off as not worth repairing (after minor dent on wing) about a year ago. We didn’t challenge the offer given at the time. Churchill was the insurer. Should I ask for evidence that it was a fair price and how they arrived at it or do you think their processes would have improved by August 2024? Thanks 

Churchill is a sub brand of Direct Line Group (now Aviva). They've already been through their audit and done corrective actions. 

As the article states, a large number of the cases have already been reviewed. For those that haven't the insurers have to proactively review the cases matching the FCAs instructions and will automatically contact those that have a problems. 

There was a flurry of posts a while back here as people were receiving unsolicited cheques from DL brands and were concerned it was some weird fraud or such. 

bglincs

The FCA statement mentions motorists and vehicles, does this investigation cover all motorists and vehicles (motor cycles, vans, campers, etc) or was it just limited to motor cars. 

medievalbiker

Will this also affect motorcycles as well as I had a motorcycle stolen that was only 3 months old but only recieved 2/3 of it's value

its_adam_not_edam

I'd like to see the insurers for the guilty party offer adequate compensation without quibbles for the extra cost the innocent party endures for 5 years after getting pranged by their client.
Because at the moment, no matter how good a driver you are with infinite no claims years, you still get charged more for insurance after simply because you're now a magnet for other bad drivers.
1 not at fault accident in 40 years, and my renewal shoots up 25%.

MyRealNameToo

its_adam_not_edam said:

I'd like to see the insurers for the guilty party offer adequate compensation without quibbles for the extra cost the innocent party endures for 5 years after getting pranged by their client.
Because at the moment, no matter how good a driver you are with infinite no claims years, you still get charged more for insurance after simply because you're now a magnet for other bad drivers.
1 not at fault accident in 40 years, and my renewal shoots up 25%.

My insurance went down after a non-fault accident, though I knew the rating tables of the insurer at the time and 1 non-fault claim on an otherwise good risk was set to make no difference in premiums. 

The reality is that "fault" is a bad term to use but we are stuck with it. What fault really is is a measure of if your insurer gets reimbursed or not (outside of any "promises" that certain insurers make to vary the normal rules). For example a hit and run is normally a fault accident but sometimes you are lucky and someone captures the vehicle registration and so its settled non fault. 

You park regularly in a badly designed carpark your car is going to get hit at times, you may be lucky the first couple of times that either the person confesses or is spotted but over a long enough timeline your going to be victim of a hit and run where no details are captured. 

Similarly there are plenty of bad drivers out there who brake excessively, cut into lanes and brake etc, unless there is evidence otherwise its likely the car at the rear will be found at fault but again the drivers luck runs out when the car at the rear has a dash cam and exposes that the lead driver cut in and then slammed on the brakes. 

At the end of the day insurance is priced on statistical analysis of millions of data points. The reality is that those that have had a claim are statistically more likely to have another claim than someone thats had none even if their first claim is non-fault. Insurers therefore just price based on the risk they are taking on. 

Youwish

I wonder how compliance with this will be policed by the FCA. Waiting for Hastings to contact me. 6 years ago I had a no-fault car write off. Wasn't happy with Hastings' agent Auxillis offer as I thought it was too low given the condition of the car but had no choice but to accept. A few months later the car was registered as back on the road and it looks like it still is. I can't log onto the policy as I changed insurers in the subsequent years. I've emailed Hastings to an old claims address but had no acknolwedgement. 

Aretnap

Youwish said:

I wonder how compliance with this will be policed by the FCA. Waiting for Hastings to contact me. 6 years ago I had a no-fault car write off. Wasn't happy with Hastings' agent Auxillis offer as I thought it was too low given the condition of the car but had no choice but to accept. A few months later the car was registered as back on the road and it looks like it still is. I can't log onto the policy as I changed insurers in the subsequent years. I've emailed Hastings to an old claims address but had no acknolwedgement. 

Auxillis are an accident management company. If you were dealing with then then they were negotiating with the third party insurer on your behalf and not making a claim on your own policy. So this ruling does not apply to your situation and there will be no money forthcoming I'm afraid.