Help with reply to claim

Coatze_2

Hi

I have claimed on my insurance. My car caught on fire whilst driving two months ago. They have now sent me the letter below? They did send me a settlement figure , I have now received the letter.

Is there any relevance that I forgot to decalare this as i have had the car two and a half years, I had the car lowered and forgot to declare this.

Can any one help??

Here is the letter---

You may recall when you rang us for a quotation; we put all the information you gave us on to the Motor Proposal Confirmation form, a copy of which we sent to you. On this form is a declaration you signed confirming all statements made were truthful and correct.
However, on reviewing your file, it appears you have not disclosed the following modification to us:
Lowered Suspension
As your insurer, we rely on your answers to assess the risk. Any non-disclosure of material information means we have the choice to declare the policy to have been of no effect or void since its start date.

Obviously, this is an extreme course of action. We would prefer to see if there are any other options available to resolve this. To enable us to do so, please write and explain why you did not disclose the modification and send us the following information:
When the change was made
Why it was made
Who made it
The cost of making it
The amount the suspension is lowered by
Why this modification was not notified to us when the policy was incepted
Any other modifications, alterations or non-standard parts.
Please note we reserve our rights under this claim until we have considered this non-disclosure. Attached is a pre-paid envelope. Please reply without delay.


I would be greatful for any advice.

Cheers

Lee

jeanette251978

It is very relevant because an insurance premium is calculated on the information that is given, not disclosing the modification means that the risk was not calculated correctly, thus meaning that the premium you paid was not relevant to the risk itself.

If i was you then i would write them a letter being 100% honest and cross your fingers, they may decide to throw this claim out of the window.

FlameCloud

Ok, you need to seperate the issue down into the claim and the policy.

At the moment, they are investigating whether they would have offered you a policy to start with. From the information you provide it will decide whether they would have offered you a policy to start with. If they say no, then they will void the policy back to its inception date, which basically means that the insurance never existed. The most the FOS can do is tell the insurer to underwrite the policy taking into account the modifications, however some insurers will not have offered any cover in the first place.

The claim itself will be on hold until the policy issue is sorted, but could be irrelevent if they void the policy.

I'd come up with a better excuse as well, you wont believe the amount of people that use this to try and get out of things.

raskazz

I have to agree that your only course of action is to be honest and apologetic - you are almost up to your neck in it anyway, the last thing you want now is to compound that with any dishonesty. I must say that your position is massively weakened because you did the modification yourself, so you cannot simply plead ignorance.

After considering the response the insurer will do one of several things, depending on the nature of your explanation (I'm assuming the car is a write off due to the fire):

1) Pay the claim with no additional premium (the chances of this happening in this case are basically 0). This option is normally only used where the policyholder did inform the insurer of a fact but the insurer either did not record it or recorded it incorrectly.

2) Deal with the claim proportionately - i.e. if the premium that was paid was, say, 60% of the premium which should have been paid then they will pay 60% of the vehicles value, minus the excess and any outstanding instalments (this option is rarely used).

3) Deal with the claim subject to an additional premium, i.e. the difference between the premium that was paid and that which should have been paid had the modification been correctly disclosed.

4) Deal with the claim on the basis of 'cover exhausted' - i.e. they will pay the claim in full but then cancel your policy with no refund.

5) Declare the policy void, the claim will not be paid at all and they will refund you your premium. This will be the option used if your explanation even hints at deliberate deception or wanting obtain a lower premium.

In your case the likely outcomes are 3) or 5). If you have been a good and loyal customer - say, over 4 or 5 years of continuous claim free business - they are far more likely to deal with the claim.

Coatze_2

many thanks for all your advice, honesty is the best policy.