RE: Independent Insurance in Liquidation
Friday 22nd June 2001
Independent Insurance in Liquidation
Call your broker now
Discussion
I am one of the unfortunate ones and the upshot is that it will cost me another 400 notes for cover until Nov. Apparently the serious fraud squad was called in this morning as a little white collar crime seems to be the reason.
While it is not the fault of manning its the end user that pays through the nose again and while being out of pocket I have no redress or optimism that anything will be done. Corporate rape in my opinion.
The Pitbull
Given that the existing policies must cover you for third party (1975 Insurance act or whatever), surely all you need to do is take out a policy which only covers you, but not a third party, which should be cheaper than the full monty replacement?
Or better still, if they are claiming they will cover 90% of your own claims, then take out insurance for the other 10% uninsured loss only?
Must be a broker somewhere who could negotiate on that - I would have thought Mannings could have done something.
(Gifted amateur talking bollox here...)
Neil
Tried that one Neil and They aren’t able to do such policies and if one were to be tailor made it would be even more expensive.
While considering your first point about being covered, yes you are but only for damage to other peoples cars, What they are not making clear in basic English terms ----- is that damage to your own Vehicle would have to firstly be argued out with the Liquidators and with no provision to get the work carried out rapidly,,, you don’t have clear definitive Comp cover.
Your choice therefore is
Drive on an effective 3rd Party policy with the full cover not at all being water tight both in injury and repair for you.
Take out another policy under the same terms on the proposal but pay a second time for the cover.
The latter is what I have done for clarity in a claim rather than anything else.
On getting the money I paid to Independent via manning will be presented to the Liquidators ( get back the second payment amount ) by Manning shortly on mass,,,, which will be a claim for tens of thousands of pounds.
On earth and Back in the real world I wont hold my breath and if money is available we will get the usual insurance % cut cos there isn’t much to go around and I bet a charge for administration fees and time spent by the Liquidators.
We need a photagraph of the people at fault.
quote:Take a look at your policy document you may find you have a clause that states that if the policy is cancelled then the full/remaining premium is due. What you will also find is that a one month policy will cost more that 1/12 of a years premium due to administrative costs etc.If you cancel a policy half way through and you pay by direct debit you may find you still have more to pay. Paul
I had a policy with Ind. Ins. as well, but I was paying by monthly direct debit. I cancelled that and I'm getting new insurance sorted. However (and not surprisingly) I got a letter from a credit collection agency this morning asking me to cough up the remaining amount due on the policy or else. I will now have to investigate my legal position but is anyone else in a similar fix ?
Noel.....Let me know how you get on because I am also in the same boat.The company the Manning used was called PCL and they were most unhelpful on the phone this morning.They told me that I have to keep paying the instalments to them monthly and that I should cough up for a new policy...how about bollox.As you say if we are not recieving a service that we are paying for then regardless of PCl having paid out monies in full to Independant then that is their risk (hence the percentage premium they charge over the top) that should be borne by them.Or do we have to go round as individulas now not only for the best quote but to look into the credit and liquidity background of each individual insurer.I am not prepared to end up paying out nearly £160 per month for insurance...let me know how you get on as I am going to cancel my DD shortly and then I suppose I will incurr the wrath of PCL.
Just thought I'd update you on where I've got with this
First of all, Manning are now taking calls again (if you can get through)
I spoke to their chap who deals with the TVR policies. He confirmed that if you don't move your insurance to another company, you are still legally insured. And yes, an industry fund (not the liquidators) are obliged to pay you 100% of a compulsory insurance claim and 90% for non-compulsory cover. Trouble is, when this last happened, the average pay-out apparently took 12-18 months - not much help when your car is off the road.
We talked about how much it would cost to move. The deal was £255 to take me up to mid November when the Independent policy would have expired (my original premium was £636). However, what persuaded me was that apparently Cornhill are guaranteeing that the premium on renewal will be the same next year ie £636. Given that premiums are meant to be going up a lot this year, I took it.
One other interesting point, apparently we stand a very good chance of getting some pence in the pound back on cancelled Independent premiums. Only problem is that this can only happen when the liquidators are finished, and as this is looking like another BCCI, the current guess is that this may be 5+ years away.
Hope this helps.
Had a threat letter off PCL this morning saying keep paying or else.
I did not know I was paying them! Brokers not much help as is the rest of the involved. I have been advised to get immediate cover elsewhere and to cancel the direct debit. PCL would then have to take me to court to recover what they have paid to Independance on my behalf that I did not know they had done?
Hi, I am Ann Manning from A Manning UK Limited who, as you know underwrite the TVR CAR CLUB members insurance scheme.
As you know the Independent who were the insurers have gone into provisional liquidation.
I know a number of members are concerned at the situation and I am happy to answer any questions that anyone may have for the next hour if I can be of any help.
I guess PCL have no choice but to chase those people who are paying by direct debit.
They seem to be one of these 'hidden' or 'seamless service' financiers. When you tell Independent you want to pay by installments, they arrange finance with PCL for you. PCL then pay the premium up front for you, and your direct debits go to them.
If the Insurance Company is solvent, there is little risk to PCL. If you wish to cancel the insurance (or if you stop paying installments) the cover is cancelled and Independent refund them a pro rata amount of the premium (if the scheme is set up correctly, this will always be more thn their exposure)
However, as Independent have gone bust, they can't get anything back from them so they have to chase the cusomers to avoid loss. Depending on how many Independent customers they are financing, this is potentially very large.
The only option is to examine the documentation to see if PCL have the right to do this (they are not going to tell you if they are on dodgy ground)
I thought it might just be helpful if I gave you some background informtion as to what happened leading to the provisional liquidation of the Independent.
As insurance brokers we have a duty of care to ensure that any company we placed business with is sound and has sufficient assets to meet all the liabilities. This is carried out on a regular basis with Standard and Poore who rate companies in AAA etc. Independent were checked regularly and whilst downgraded posed not threat and their assets fully met the liabilities.
What we understand has happened, and I should say at this stage I am only receiving unofficial information, is that the reserves of claims was written down to make the balance sheet look good.
For example if an insurer suffers a liability claim these can sometimes take many years to settle especially in the litigaeous world we live in. So a serious injury is assessed and a reserve put on it and this has to be accounted for in the balance sheet. What has happened is in order that the balance sheet looked healthy the reserve were written down to very low estimates and in some cases £1. So if there was a serious injury the correct reserve could be millions of pounds having written it down to £1 the balance sheet then looks much healthier.
What we understand is that the claims manager was asked to take this action on a major claim and refused and left the Independent immediately saying this was unethical etc. Again a replacement was found and she was asked to do the same things and she left. This news got into the market and questions were then asked.
The shares dived and you know the rest. We were informed on 14 June that they would no longer accept new business bt would continue to write the existing business until renewal date when you would be asked to find a new insurer.
We already had a new insurer for the new business so that was not a problem and this continued with the new insurer as the Cornhill.
However during that weekend the serious fraud squad were called in and we were told around 11 am that the company had gone into provisional liquidation.
We took advice from the Association of British Insurers who told us that whilst the Independent had to pay compulsory insurance they would only pay 90% of non compulsory insurance.
We got a letter out that night to all TVR Members saying exactly what the situation was as we knew it and stating that the policy could be transfered to Cornhill subject to the return of a signed declaration that there were no material facts affecting the insurance that had not been reported.
So far we have had about 600 declarations and all cover notes have been issued here and will be dispatched to Members within the next 7 days.
As regards the instalment facility we currently do not know the answer. I have spoken with the Policyholder Protection Board, Citzens Advice Bureau, Independent and Price Waterhouse. The latest situation is that PW have a meeting this afternoon to discuss the situation.
I appreciate that Members are in a difficult situation and I am trying to resolve matters as quickly as I can. Obviously A Manning UK Limited will pursue the recovery for all Members.
I will keep you all posted via this site and the magazine as quickly as I know anything and I would be grateful if you would spread the word.
On a personal note I would like to thank the Members for all the help and support, this situation has been unprecidented in the history of insurance and we are working flat out. I noticed the comments about our telephone line. The TVR team here are taking about 30 calls an hour and we are doing our best to explain in detail to each caller the situation and the options available. We are hear doing our best to get through the situation and I am telephoning Members where questions have been sent by fax as quickly as I can.
Once again thank you for your support.
Ann
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