Cancelled Car Insurance - Help!

[Poppy57]

The initial message was deleted from this topic on 13 September 2023 at 08:54

[JQ]

Poppy57 said:

Hello,

Really hoping someone can give some advice, my son is currently havent a nightmare with Insurance Company following a non fault claim, all on camera and other driver being prosecuted. My sons car is a write off. Due to a stupid mistake he made when taking out a car policy, he’s now had this ‘ We understand that failing to disclose this may have been unintentional, however, had we been aware of the missing information we wouldn’t have been able to offer you a policy. We are continuing and dealing with the claim due to mitigation you provided but we are unable to continue with the policy further.’ I don’t think there’s any way around the cancellation, misunderstanding on registered keeper, but the claim is still continuing. Insurance company is impossible to communicate with, 2 hour waits, foreign call centre and inexperienced staff. My son still has the V5C document and hasn’t been told if he should tell dvla about write off. He still has the hire car he was given whilst the claim is being settled, not told if he should give this back. He has another car with a different insurance company but worried when he gives them an update about what’s happened, they’ll cancel that policy too. All that on top of the difficulties of finding a new insurer and higher prices. Guessing an insurance broker might be the best way to go and actually speak to a person. This is all getting very stressful, I’ve haven’t had this happen to me before so at a loss of what advice to give. Any help and advice would be much appreciated. Thanks

I'm no insurance expert, but it may be helpful if you fully explain the misunderstanding around the registered keeper.

As for the hire car - I've just been through the same and I had to hand the hire car back within 7 days of being in receipt of the monies for writing off my car. The money landed in my bank account today, so I immediately contacted the insurer and asked them to collect as soon as convenient.

[samoht]

I think the claim and the policy cancellation are two distinct issues.

Assuming the other party's insurer have accepted full responsibility for the accident, then their insurer should reimburse your son for his costs (hire car plus replacement car). This shouldn't cost his own insurer anything, and is independent of his own insurance policy.

[imagine the case you were walking along the pavement and a car mounted the pavement and hit you - you wouldn't have any of your own insurance, but you could still claim against the driver that hit you's insurance].


With the cancellation as stated, you'd need to provide more information about the mistake your son made when taking out the policy originally. If the insurance company can justify their claim that they wouldn't have offered insurance at all if they'd known the correct information up front, then unfortunately I think they are within their rights to cancel the policy.

[mmm-five]

(From personal experience - in my case the car was in bits in the garage getting a refresh) if I was the 3rd party's insurer, I'd be asking why I should be paying for a hire car at all, considering your son owns another car.

But your son's ex-insurer may only cover 'company' cars in that demographic, and as a personal car they can't cover it at all.

[CraigyMc]

Poppy57 said:

Thank you for the reply, he already tried explaining and they accepted it was unintentional but if the policy had been applied for with the registered keeper listed as it is, company name not personal name, then it wouldn’t have been accepted, explaining the cancellation even though they agreed it was unintentional. Claim still not settled so hoping it’s ok to hold on to the hire car for now. Thanks

This is unclear to me and perhaps to others.

Is

1. the insurance policy taken out with his name as registered keeper, when the car is in fact kept by a company, or
2. the insurance policy taken out in the company name when your son is the actual keeper?
3. Neither of these (please explain further)

[Sheepshanks]

Poppy57 said:

Thank you for the reply, he already tried explaining and they accepted it was unintentional but if the policy had been applied for with the registered keeper listed as it is, company name not personal name, then it wouldn’t have been accepted, explaining the cancellation even though they agreed it was unintentional. Claim still not settled so hoping it’s ok to hold on to the hire car for now. Thanks

So he's insured a company owned car on a personal policy?

It's been discussed here before - some insurers seem to fine with it (although it's not 100% clear they realise, especially if the car is leased, as the leasing company is the owner and RK and so 'masks' that the lease is in a company name). but many just say no.

Company cars are normally on "commercial lines" insurance.


Oh, and if he's got another car he can use he might be on dodgy ground taking a hire car.

[Welcome.]

Poppy57 said:

Hello,

Really hoping someone can give some advice.

My son is currently havent a nightmare with Insurance Company following a non fault claim, all on camera and other driver being prosecuted.

My sons car is a write off and due to a stupid mistake he made when taking out a car policy, he’s now had this ‘ We understand that failing to disclose this may have been unintentional, however, had we been aware of the missing information we wouldn’t have been able to offer you a policy. We are continuing and dealing with the claim due to mitigation you provided but we are unable to continue with the policy further.’

I don’t think there’s any way around the cancellation, misunderstanding on registered keeper, but the claim is still continuing. Insurance company is impossible to communicate with, 2 hour waits, foreign call centre and inexperienced staff.

My son still has the V5C document and hasn’t been told if he should tell dvla about write off. He still has the hire car he was given whilst the claim is being settled, not told if he should give this back.

He has another car with a different insurance company but worried when he gives them an update about what’s happened, they’ll cancel that policy too. All that on top of the difficulties of finding a new insurer and higher prices.

Guessing an insurance broker might be the best way to go and actually speak to a person. This is all getting very stressful, I’ve haven’t had this happen to me before so at a loss of what advice to give.

Any help and advice would be much appreciated.

Thanks

[ChocolateFrog]

The hire could the bigger issue. No doubt credit hire like-for-like at exorbitant rates.

It's 15 years ago now but when I had a bike through credit hire the fee was £126 per day and I had it well over 100 days.

Wasn't until the end of that hire period I was informed I could be liable if the other insurance company refuse to pay up. Apparently the onus is on you to keep costs reasonable.

[CraigyMc]

Poppy57 said:

Thank you for replying, the other car is his but used by his partner, so the hire car is needed. He’s self employed, it’s his company, he’s the sole employee, only director and the company name matches his but has Ltd on the end of it, cause of confusion over registered keeper. His own company owns the car but shouldn’t be registered keeper because the insurance company wouldn’t have provided a policy on that basis. All very confusing and can see that he should have taken advice on the whole situation before taking out a policy.

It sounds like doesn't own the car, his company does; likewise the registered keeper of the car should be the company joe bloggs ltd rather than the person joe bloggs.

Many insurance policies/underwriters require that the owner+registered keeper is the person who is taking out the policy.

Apart from anything else, if the car is wrecked, the ownership of it doesn't pass to Joe Bloggs from Joe Bloggs Ltd. He shouldn't personally benefit from a payout on this car, the company should recieve that.

I think the insurance company is correct to cancel this policy. The company Joe Bloggs Ltd should have a business insurance agreement covering the car.

[Sheepshanks]

Poppy57 said:

His own company owns the car but shouldn’t be registered keeper because the insurance company wouldn’t have provided a policy on that basis.

You get asked who owns the car and who is registered keeper - sometimes it's just a tick box to confirm it's the policyholder. If the insurer doesn't want to insure company cars then they wouldn't have covered it if they knew his company was the owner even if he was registered keeper.

It's all got very uncertain now, but it used to be a thing that you couldn't insure (as policyholder) a car that you didn't have an insurable interest in. In other words, if anything happened to the car it's your son's company's problem, not his personal problem. Obviously you might think him and his company are the same thing, but legally they're not.

[Speed 3]

Don’t see what the problem is. The insurance company are saying they’ll honour the claim even though they shouldn’t have taken the policy on. New vehicle needs to be procured by the Ltd Co to replace the write off (with it as the Registered Keeper) and a new policy taken out to cover it with an insurance company that accepts Ltd Companies as policy holders. If the write-off payout is made to him personally, he needs to transfer it to the company bank account.

[Speed 3]

Another piece of advice - when the claim is settled (and not before) get him to change the name of the Ltd Co to something not containing his actual name. That was an unwise original decision for many reasons.

[Ninja59]

Speed 3 said:

Don’t see what the problem is. The insurance company are saying they’ll honour the claim even though they shouldn’t have taken the policy on. New vehicle needs to be procured by the Ltd Co to replace the write off (with it as the Registered Keeper) and a new policy taken out to cover it with an insurance company that accepts Ltd Companies as policy holders. If the write-off payout is made to him personally, he needs to transfer it to the company bank account.

The issue will be how many insurers fundamentally want to take on someone with a cancelled policy

[Speed 3]

Ninja59 said:

The issue will be how many insurers fundamentally want to take on someone with a cancelled policy

But it was only cancelled due to an acknowledged minor error which clashed with that companies corporate policy. Probably depends on if there's an insurance database marker, a broker should be able to help there.

[oakdale]

When the insurance was taken out, did he say it was for private/domestic use only or was business use included?

Was the vehicle used for business purposes?

[Ninja59]

Speed 3 said:

But it was only cancelled due to an acknowledged minor error which clashed with that companies corporate policy. Probably depends on if there's an insurance database marker, a broker should be able to help there.

It might be minor and against a policy, but either way cancelled is cancelled (in terms of not complying with honesty).

Some insurers will probably be fine with it but give an awfully inflated premium as a result. Others will simply go no.

Just to add my nephew recently got caught up in a similar cancellation. Admiral quoted £14k....

[TwigtheWonderkid]

oakdale said:

When the insurance was taken out, did he say it was for private/domestic use only or was business use included?

Was the vehicle used for business purposes?

What difference does any of that make? Bottom line, he said it was his car, but in fact it was his company's car. Had the insurers known the truth, they would not have covered him.

That's all we need to know. He's had his policy cancelled because he obtained it by deception, all be it unintentional. It's going to be a problem going forward, almost certainly.

[Trax]

If they haven't cancelled the policy yet, it may be worthwhile cancelling it himself first. That's if he can with the claim still open. This means the question have you ever had a policy cancelled before can be answered, no.

[TwigtheWonderkid]

Trax said:

If they haven't cancelled the policy yet, it may be worthwhile cancelling it himself first. That's if he can with the claim still open. This means the question have you ever had a policy cancelled before can be answered, no.

That works if they tell you they are going to cancel in 7 days or whatever. Phone them up immediately and cancel before they do. In this instance, where the car isn't drivable and they've said they can't continue with the policy, suggests they have cancelled with immediate effect. Might be worth checking though.

[Speed 3]

There's two different insured parties options here for the future cover - the Ltd Co (primarily business use) or the the individual (with business use added to the private policy), whichever wasn't named as the original policy holder, just swap it to the other as the answer to the question "have you ever had insurance cover cancelled" can't be yes for both parties as only one was the policy holder. Just ensure the new V5 reflects the same Keeper.