Insurance write off question

Insurance write off question

Author
Discussion

drjhill

Original Poster:

174 posts

189 months

Friday 11th April 2014
quotequote all
This is a new situation for me so I hope someone on here can help:

My son and heir (not that there is going to be much of an inheritance now) passed his test 3 weeks ago. New insurance for our runabout with me as main and him as named driver. This morning he put it onto it's roof in talent/cornering imbalance (bruised knee and pride only)

So cost of car £2300 minus excess for him £700. Insurance cost £1400 but only first instalment paid so far. But insurance contract is for 12 months isn't it? So if I can find another motor do we carry on, and brace myself for a reaming at renewal time?

Or take the payout and invest it coke and hookers?

His big sister just used to play bumper cars, nothing in this league. And SWMBO blames me, but you already know that

Many thanks

Vaud

50,291 posts

154 months

Friday 11th April 2014
quotequote all
Just to check - who was the primary driver of the "runabout"? Is this a 2nd/3rd family car?

GC8

19,910 posts

189 months

Friday 11th April 2014
quotequote all
They used to carry on and cancellation in the event of a total loss was the sign of an insurer to be avoided.

Its so common now that it is the norm.

TwigtheWonderkid

43,248 posts

149 months

Friday 11th April 2014
quotequote all
Most policies will demand the outstanding premium is paid in full before settling a claim. So from the value of the car they will deduct the £700 xs and the balance owing of the annual premium.

It's normal these days to allow you to do a substitution to a replacement car, and use up the rest of the period.


Aretnap

1,643 posts

150 months

Friday 11th April 2014
quotequote all
It's an annual contract yes, and the remainder of the £1400 will still be payable. If you get a new car the insurer should allow you to transfer the policy to the new one, so the premium doesn't go to waste. If you don't replace the car then once the excess and the remainder of the premium are deducted from the payout you'll be left with something like £300 to invest... does that buy you a lot of coke and hookers these days?

Roo

11,503 posts

206 months

Friday 11th April 2014
quotequote all
Vaud said:
Just to check - who was the primary driver of the "runabout"? Is this a 2nd/3rd family car?
Oh dear. It's not looking good is it?

LoonR1

26,988 posts

176 months

Saturday 12th April 2014
quotequote all
GC8 said:
They used to carry on and cancellation in the event of a total loss was the sign of an insurer to be avoided.

Its so common now that it is the norm.
What's so common?bthat they cancel the policy? Actually the opposite is true.

GC8

19,910 posts

189 months

Saturday 12th April 2014
quotequote all
Im going to presume that things have finally come full circle then, which is good.

In 2012 my car was stolen and the Capita-owned crooks who insured it immediately cancelled my policy, showing that this sort of behaviour is far from extinct.

LoonR1

26,988 posts

176 months

Saturday 12th April 2014
quotequote all
GC8 said:
Im going to presume that things have finally come full circle then, which is good.

In 2012 my car was stolen and the Capita-owned crooks who insured it immediately cancelled my policy, showing that this sort of behaviour is far from extinct.
God knows when this page was written, but I've been using it to deal with PH paranoia for at least 4 years

Point 17

http://www.financial-ombudsman.org.uk/publications...

GC8

19,910 posts

189 months

Saturday 12th April 2014
quotequote all
I will read that tomorrow. I have to concede that my opinion was formed on the back of my own experience and other anecdotal evidence. I am more than happy to be wrong.

LoonR1

26,988 posts

176 months

Saturday 12th April 2014
quotequote all
GC8 said:
I will read that tomorrow. I have to concede that my opinion was formed on the back of my own experience and other anecdotal evidence. I am more than happy to be wrong.
It's here in full for you, second paragraph.

17. outstanding premium instalments or premium refunds

Most motor insurance policies are yearly contracts – so the full premium is payable even if the vehicle is written off during the year. If the consumer paid the yearly premium upfront, they will not receive any refund. Or if the consumer was paying the yearly premium by monthly instalments, they must still pay the outstanding instalments after the vehicle is written off.

When an insurer declares a vehicle a write-off, we expect it to offer a consumer the option of bringing a replacement vehicle onto the insurance policy so that the remainder of the policy term can be used. Depending on the make and model of the replacement vehicle, an additional premium may be required by the insurer. This should be calculated on a pro rata basis for the remainder of the policy term.

GC8

19,910 posts

189 months

Saturday 12th April 2014
quotequote all
Read it now. That only goes to reinforce my opinion of Sureterm, whose T&Cs clearly state that the policy can be cancelled in the event of a total loss.

Still: if only that was the largest complaint that I had with them.

Aretnap

1,643 posts

150 months

Saturday 12th April 2014
quotequote all
GC8 said:
Read it now. That only goes to reinforce my opinion of Sureterm, whose T&Cs clearly state that the policy can be cancelled in the event of a total loss.
They should still give you the option of transferring the balance of the policy to the new car* . If they didn't, a complaint to the ombudsman would be in order.

  • Assuming your new car is one they'd cover of course - if your Fiesta is written off and you take the opportunity to upgrade to a Ferrari you might find that they won't transfer the cover to the Ferrari. But if you're buying a Ferrari you can probably afford not to worry about a few month's insurance on the Fiesta.

dacouch

1,172 posts

128 months

Saturday 12th April 2014
quotequote all
LoonR1 said:
It's here in full for you, second paragraph.

17. outstanding premium instalments or premium refunds

Most motor insurance policies are yearly contracts – so the full premium is payable even if the vehicle is written off during the year. If the consumer paid the yearly premium upfront, they will not receive any refund. Or if the consumer was paying the yearly premium by monthly instalments, they must still pay the outstanding instalments after the vehicle is written off.

When an insurer declares a vehicle a write-off, we expect it to offer a consumer the option of bringing a replacement vehicle onto the insurance policy so that the remainder of the policy term can be used. Depending on the make and model of the replacement vehicle, an additional premium may be required by the insurer. This should be calculated on a pro rata basis for the remainder of the policy term.
It was added / amended about September last year

Devil2575

13,400 posts

187 months

Saturday 12th April 2014
quotequote all
When I wrote my car off the Policy was cancelled but I was able to transfer the remainder of the term to my replacement vehicle.

LoonR1

26,988 posts

176 months

Saturday 12th April 2014
quotequote all
Devil2575 said:
When I wrote my car off the Policy was cancelled but I was able to transfer the remainder of the term to my replacement vehicle.
Me too in 2007 when I wrote my bike off. It's not a new thing, just the FOS driven expectation appears to be recent.

GC8

19,910 posts

189 months

Saturday 12th April 2014
quotequote all
Aretnap said:
GC8 said:
Read it now. That only goes to reinforce my opinion of Sureterm, whose T&Cs clearly state that the policy can be cancelled in the event of a total loss.
They should still give you the option of transferring the balance of the policy to the new car* . If they didn't, a complaint to the ombudsman would be in order.

  • Assuming your new car is one they'd cover of course - if your Fiesta is written off and you take the opportunity to upgrade to a Ferrari you might find that they won't transfer the cover to the Ferrari. But if you're buying a Ferrari you can probably afford not to worry about a few month's insurance on the Fiesta.
Thanks. I haven't received any thing from them yet, two years on. They tried to pay a pittance and have lied and cheated with regards to the modest agreed value. I will add this to the end of ombudsman complaint.

davepoth

29,395 posts

198 months

Saturday 12th April 2014
quotequote all
Roo said:
Vaud said:
Just to check - who was the primary driver of the "runabout"? Is this a 2nd/3rd family car?
Oh dear. It's not looking good is it?
I doubt fronting will be an issue here - I'd suggest that three weeks isn't really long enough to establish a pattern of use. Top work to the OP's son for getting the car upside down with no serious injuries though. I assume he'll be taking the bus for a while... wink

littleredrooster

5,523 posts

195 months

Saturday 12th April 2014
quotequote all
T'was different back in the day...in 1988(?) when my motorcycle was stolen, the letter from my insurers explained that the policy had become 'paid-up' and had now ceased.

I was unfortunate enough to have suffered the loss in the first few weeks after renewal, so not only lost the bike but also most of the annual premium when I came to insure its replacement...and most of my precious NCB. Bugger. Triple whammy!

bigmadjohn

210 posts

206 months

Saturday 12th April 2014
quotequote all
Was anyone else involved in his accident, ie-will your insurance company be liable for any 3rd party claim? Were police/other emergency services involved? Have you informed the insurance company? If all 3 are a no, I would be tempted to weigh the car in for scrap, and not claim. At the moment your £2300-£700excess-£1400insurance costs= will leave you £300 up by claiming, if you take into account the extra cost of renewing, loss of NCB, plus the £150-200 for scrap you would get, you might even be able to transfer the remainder of the policy to another car if you dont claim. I would definately look into the potential costs before putting a claim in, however, if any of the above 3 things have happened you might not be able to take this route.