Help - Looking at taking a loss

[jonamv8]

Hi,

Not specifically business in the trading sense but it concerns money which to me equals business. A lot of good advice provided on this forum so I'd ask the mods to leave where it is if you could.

Own a vehicle which a third party hit at 45-50 while I was stationary last week. Being very busy I agreed to a friend of a friend who is in accident management to handle it all. Car was collected, courtesy car dropped off and third party insurer admitted liability. Pretty obvious really as I was rear ended.

Damage was bad, I thought a write off. Rear 1/4s, rear bumper, external boot, panels inside boot space , alloy, tyre, possibly bent suspension on one side, both exhausts, god knows what else that I couldn't see. Car took a hell of a smack.

'Independent valuation expert' viewed car and stated circa 10k damage to the car. He also stated the vehicle to be valued at £14k! Looking at AutoTrader, eBay Motors and Franchise Approved Cars I searched using the exact same criteria as my car and I produced cars for sale from 16k to 19k. I matched, mileage, age, spec etc. Surely this should be negotiated in a write off scenario, you simply cannot replace that vehicle like for like for 14k, I'm losing 3k at least.

I'm also being told that the car should be repaired as it still has equity in it but I don't want it repaired. Also if it does get repaired do I get compensation for the drop in value as a result of a massive repair job?

I've not been in this situation before, where do I stand, what should I do.

Currently contacted Trading Standards, FCA, F-Ombudsman, ABI and I'm speaking to Citizens Advice tomorrow - all of them useless tbh

[jonnydm]

I would guess that an Accident Management co is using discretion in order to make their business work. If your car is given a lower value, you receive less and if it's getting repaired, they can cream off hire car costs etc.

When my car was stolen last year, I gave them every scrap of info including service history in order to determine the value, which we negotiated in the end. The final settlement took into account of the fact that a comparable car had to have full history and similar mileage.

[Frimley111R]

Is it your choice to have it written off though? (Just asking, don't know). I can see an insurance company looking at it as 'We give you £16k for a new car or pay £10k for it to be repaired.

[jonamv8]

jonnydm said:

I would guess that an Accident Management co is using discretion in order to make their business work. If your car is given a lower value, you receive less and if it's getting repaired, they can cream off hire car costs etc.

When my car was stolen last year, I gave them every scrap of info including service history in order to determine the value, which we negotiated in the end. The final settlement took into account of the fact that a comparable car had to have full history and similar mileage.

I'm starting to agree with those sentiments. Company wants to repair it and make £££ from repair while also making £££ from the hire car during the no doubt prolonged repair process.

In relation to value no one seems to be acknowledging the evidence that I have provided of circa 20 similar vehicles all valued at higher that the £14k

[jonamv8]

Frimley111R said:

Is it your choice to have it written off though? (Just asking, don't know). I can see an insurance company looking at it as 'We give you £16k for a new car or pay £10k for it to be repaired.

No I don't think it is but I am conscious that given the level of damage and how close it probably is to being written off I should be given the option of a second opinion.

Also am I right to state that I want it repaired by an approved/franchise main dealer rather than the accident management companies body shop of choice?

[jonnydm]

jonamv8 said:

Frimley111R said:

Is it your choice to have it written off though? (Just asking, don't know). I can see an insurance company looking at it as 'We give you £16k for a new car or pay £10k for it to be repaired.

No I don't think it is but I am conscious that given the level of damage and how close it probably is to being written off I should be given the option of a second opinion.

Also am I right to state that I want it repaired by an approved/franchise main dealer rather than the accident management companies body shop of choice?

You can try. Would likely depend on the terms of your insurance or any agreement that you may have entered into with said Accident Management Co.

[Dr Interceptor]

Frimley111R said:

I can see an insurance company looking at it as 'We give you £16k for a new car or pay £10k for it to be repaired.

That is exactly how they'll look at it.

It's a problematic situation, and there's rarely a happy outcome. Your car was worth £16-17k, when it comes back following a repair chances are you won't be happy with it. You'll know in your mind it has had a smack, it will feel a bit different, you won't be happy with the panel gaps and paint finish. So you take it down the garage, and you get offered £14k in trade in.

By valuing it at £14k, a £10k repair stands more chance of writing it off, and will save you the nightmare of going through having it fixed. Plus you never settle on their first offer, so you can push them for a bit more, and probably end up with £15k.

You could then file a claim against the 3rd party insurer for the loss you incur, but the time it would take to pursue would probably negate any award.

[Blue Oval84]

Check what you've signed but you can normally take your car to any repairer you like (within reason) when you're claiming off a third party. It may be that you're already in some sort of agreement with the AMC though?

Either way, if the repairs are valued at £10K and you're saying the car is worth more like £17K I doubt they'll write it off.

[Simpo Two]

jonamv8 said:

He also stated the vehicle to be valued at £14k! Looking at AutoTrader, eBay Motors and Franchise Approved Cars I searched using the exact same criteria as my car and I produced cars for sale from 16k to 19k. I matched, mileage, age, spec etc. Surely this should be negotiated in a write off scenario, you simply cannot replace that vehicle like for like for 14k, I'm losing 3k at least.

It may be the trade value.

I had a policy which stated that if my car was wrecked I'd get 'market value' for it. When I pushed them to explain what market value meant, they admitted it was actually the trade price. No-one outside the trade can reasonably expect to buy at such low prices so it's silly.

[jonamv8]

Simpo Two said:

It may be the trade value.

I had a policy which stated that if my car was wrecked I'd get 'market value' for it. When I pushed them to explain what market value meant, they admitted it was actually the trade price. No-one outside the trade can reasonably expect to buy at such low prices so it's silly.

I think it is. I also have a sneaky suspicion that the AMC are actively valuing the vehicle at less so that I don't want it written off enabling them to cream off the repairs and also the prolonged hire car.

[jonamv8]

Blue Oval84 said:

Check what you've signed but you can normally take your car to any repairer you like (within reason) when you're claiming off a third party. It may be that you're already in some sort of agreement with the AMC though?

Either way, if the repairs are valued at £10K and you're saying the car is worth more like £17K I doubt they'll write it off.

Need to check the t&cs, possibly some sort of cooling off period. As I see it, if it needs to be repaired then the AMC are already profiting on a daily basis from the hire car costs so it should be my preference as to where my 16k asset is repaired

[Steve H]

One point to remember is that when checking the "value" of your car against others on Autotrader etc you must only look at the private sale examples. Insurers will not pay out based on dealer prices because if you still had yours "pre accident" and put it up for sale you could not ask for "dealer" price.
Hope that makes sense!

[droopsnoot]

And they may be applying a fiddle factor detailed statistically-derived calculation to adjust the asking prices on Autotrader to what they feel the cars would actually sell for.

[dacouch]

Steve H said:

One point to remember is that when checking the "value" of your car against others on Autotrader etc you must only look at the private sale examples. Insurers will not pay out based on dealer prices because if you still had yours "pre accident" and put it up for sale you could not ask for "dealer" price.
Hope that makes sense!

Not strictly true, the Ombudsman expects Insurers to settle claims at the dealers value as per the valuation guides eg Glasses and Cap etc. The Ombudsman does not take much notice of adverts in Autotrader and the like as they're regarded as being the price the seller is willing to start negotiations from.

Although saying that the OP has no redress with the Ombudsman since their using an accident management company whose main source of income is from the expensive hire car although they will also normally expect circa 5% of the repair costs from the repairing garage...

[Steve H]

dacouch said:

Steve H said:

One point to remember is that when checking the "value" of your car against others on Autotrader etc you must only look at the private sale examples. Insurers will not pay out based on dealer prices because if you still had yours "pre accident" and put it up for sale you could not ask for "dealer" price.
Hope that makes sense!

Not strictly true, the Ombudsman expects Insurers to settle claims at the dealers value as per the valuation guides eg Glasses and Cap etc. The Ombudsman does not take much notice of adverts in Autotrader and the like as they're regarded as being the price the seller is willing to start negotiations from.

Although saying that the OP has no redress with the Ombudsman since their using an accident management company whose main source of income is from the expensive hire car although they will also normally expect circa 5% of the repair costs from the repairing garage...

But surely the whole ethos of an insurance contract is to put you back into the position you were in prior the claim and not in a better position. Therefore, i.e. you have a car which as a private sale is worth say £10k but the same car, at a dealer is £13k and this is because they offer warranties and have overheads etc etc. You cannot expect to get £13k from the insurer as this would put you in a better position post claim. Insurance does not allow for betterment

[3200gt]

Unless I'm mis-understanding the position, why are you even arguing the values involved? Your insurance are not paying for the repair, theirs is. You pay an insurance company not only to insure you but to represent you also. Your company should be relating their offer, which you either accept or reject. If you reject it's your insurance that should be arguing. Give them the details you have on equivalent prices and tell them that you'll accept nothing less. before accident value versus post accident value must equal zero difference. How they resolve that is irrelevant to you. Get your insurance company to do what you pay them for.
Stand firm and they will fold. Mine did or should I say the third parties did.

[dacouch]

Steve H said:

But surely the whole ethos of an insurance contract is to put you back into the position you were in prior the claim and not in a better position. Therefore, i.e. you have a car which as a private sale is worth say £10k but the same car, at a dealer is £13k and this is because they offer warranties and have overheads etc etc. You cannot expect to get £13k from the insurer as this would put you in a better position post claim. Insurance does not allow for betterment

When claiming from your own Insurer you have the protection of the Ombudsman who states that in normal circumstances they expect your Insurer to settle the claim at the book value eg Glasses, Parkers and CAP based on the dealer value.

The Ombudsman regards adverts in Autotrader either private or trade or cars on dealers forecourts to be priced with a margin for negotiation built in hence using the guides for a normal vehicle.

This link will explain how the Ombudsman expects an Insurer to value a vehicle

www.financial-ombudsman.org.uk/publications/techni...

If you deal with the third party directly they are under no obligation to follow the Ombudsman's guidance although many will as good practice, if you deal with an accident management company who make no money from a write off but make more money by prolonging your stay in an expensive car hire they will generally take a lot longer to deal with a written off car and again are under no obligation to follow Ombudsman's guidance. Many will hang the valuing out and then push you to settle for a lowish amount as they are really only interested in their hire car money

[russ_a]

I worked for a Lloyd’s syndicate for a few years and can honestly say we always settled using the figures from Glasses Guide. You can't just make a figure up and then put forward an offer.

Also, by law you are required to mitigate your loss, hiring a luxury car if not needed *may* not be reimbursed. We saw a few people fall foul of the contracts with Accident Management firms when the insurer refused to pay excessive hire charges.

Why not give the insurer a call and ask what their thresholds are for total loss claims.

[Efbe]

I was in a similar situation, one statement got me out of this mess though... "Find me a car equal in spec, mileage and condition for that amount of money".

It was actually a motorbike, and they couldn't. The offer was increased.

[jonamv8]

Hi all, thanks for comments, experiences and advice.

By way of update, the damage is not reaching the threshold for write off so the value has become irrelevant at this stage. It is going to be repaired and we have proposed that a manufacturer approved/franchise body shop completes the work on my behalf to ensure the repair is completed to the highest standards.